August 03, 2015

Business Developers Sense Memphis’ New Image, Like It

By:  Tom Bailey, Jr.
Commercial Appeal
The red line around Memphis — which actually warned site-selection consultants to steer corporate and industrial clients away from the city — is fading.
That was the word this week at a meeting of business, civic and political leaders who gathered to learn more about EDGE, the new superboard for economic development in Memphis and Shelby County.
Memphis Mayor A C Wharton recounted for about 50 people, gathered in the sleek, East Memphis conference room of the Glankler Brown law firm, how developer Ron Belz visited him in 2002 after Wharton had just been elected Shelby County mayor.
Belz brought along a map from a presentation given at a conference for site-selection professionals in Atlanta.
“Memphis and Shelby County had been red-lined out, saying, ‘Don’t go there. Don’t waste your time,”’ Wharton recalled.
“The word was we had turned out all the lights and rolled up our welcome mat.”
Even a successful corporate-location consultant who is based in and lives in Memphis virtually ignored the city professionally.
“The EDGE program is overdue by 20 years,” said J.M. “Mike” Mullis, who annually completes about 50 projects totaling $2 billion in investments.
“I don’t care about politics. I care about the business,” he said.
Corporations want “business conditions wrapped with good political sense. When they don’t see that, we tend to shy away.”
People often asked Mullis how he could live in Memphis but not do business here.
“It’s because we didn’t have the formula to make it work. … It’s pretty interesting the politics here. (But) now we see the opportunity to put business first,” he said.
One reflection of the lack of a good business climate in Memphis had been the 3,000-acre Frank C. Pidgeon Industrial Park, which sat underdeveloped “all those years,” Mullis said.
During the upbeat event at Glankler Brown, the half-dozen speakers never referred to Willie Herenton, the former city mayor who grew more controversial as his long tenure drew to an end in 2009.
Mullis explained later that the formerly challenging political climate was not personal, but involved too many entities controlled by different people.
“What I’m seeing in the two mayors we have now, I’ve never seen in the history of Memphis,” he said in a phone interview Friday. “They are in lockstep to get Shelby County back into the major game of economic development.”
Since Wharton and new Shelby County Mayor Mark Luttrell formed a virtual two-man team last year in pursuit of economic development, Electrolux announced it will use 800 acres at Pidgeon to build a $230 million plant employing 1,240 people, and Mitsubishi Electric announced it will build a $207 million plant and employ 281 workers in nearby Rivergate Industrial Park.
Wharton and Luttrell also are changing local government’s structure for economic development.
They’re consolidating all the boards and local government functions that deal with economic development into EDGE (Economic Development Growth Engine).
Its 11 board members will take over the missions of seven different agencies, so prospective companies with questions and seeking incentives need go to only one place.
“I have promised to the city mayor we will bring prospects here if you make the structure work,” Mullis said.
Now that EDGE is being put into place, Mullis said local government must improve two other areas: Education and “skill set transferability.”
“You could create the most effective EDGE possible and if you don’t do everything else that has to be done, it’ll still fail,” he said.
Corporate prospects always ask questions about schools, he said, adding it’s important to fund quality public education.
As for skills, the workforce must be trained for changing demands. Manufacturing was bigger 25 years ago. Now logistics is substantial.
For the city to develop as a technology center, the workforce will need the skills, Mullis said.
With a modest cost of living, “phenomenal utilities” and so many logistics resources, Mullis said of Memphis, “I tell you what, it’s a pretty good place to live.
“There are just a few more things we need to do.”