Industrial DevelopmentVarious projects are underway in the Fox Valley to further develop industrial parks from Fond du Lac to KaukaunaStory by Sean FitzgeraldThere’s no doubting the value of manufacturing production in the Fox Valley. With the area’s economic history being built almost exclusively on the production of goods, the Fox Valley still boasts one of the highest manufacturing employment concentrations of any region in the country, with nearly a quarter to a third of the local work force making a living from some kind of production industry. That depth of manufacturing employment places a heavy responsibility on local economic development officials, whose efforts during the past four decades have created thousands of new jobs, improved the per capita income of area residents six-fold, and generated hundreds of millions of dollars of improved property valuation. To keep existing manufacturers competitive and attract new companies to the area, municipalities have migrated into the business of developing real estate for business and commercial purposes. Municipalities have taken on the task of surveying former agricultural and other land, plotting out streets, installing sewer, water, electrical and telecommunications infrastructure, and even brokering land deals. Such a role is viewed by many as a necessary means of fostering the kind of industrial development that grows jobs and tax base in larger communities, where a project of such magnitude would amount to too much cost and risk for a private developer. Many communities have experienced tremendous success in industrial land development through wise foresight, careful planning and execution, and little bit of luck while catching the waves of national economic trends. Though there’s no flashy entrance, a plat of new roads, sewer and water have been put in by the city at the NEW Prosperity Center during the past 12 months. At the same time, paper industry manufacturer Albany International built an $11.3 million, 191,000-sq. ft. facility and Liebovich Steel constructed a $5 million, 130,000-sq. ft. regional distribution center. Kaukauna – which has its own municipally owned and operated electrical utility – boasts the lowest electrical rates in Wisconsin. Mayor Eugene Rosin said the city’s low electric rates have been a key factor in site selection for companies like Albany and Liebovich. “They’re both high electric energy users,” Rosin said, reporting a study conducted by Albany International management indicated the firm would save more than $100,000 in electric bills annually through the Electric City’s utility compared with the amount it would pay to one of the major investor-owned utilities serving most of northeast Wisconsin. City officials in Kaukauna made the move a little over a year ago to purchase the property for the NEW Prosperity Center, recognizing space was dwindling in its North Industrial Park, where currently just one parcel remains. The city coordinated with East Central Regional Planning Commission to study the availability of large industrial parcels in northeast Wisconsin, and found there were few parks boasting parcels of 15 acres or larger with convenient access to U.S. Highway 41. Rosin said city leaders believed Kaukauna could find a niche for itself. The Albany and Liebovich facilities sit on 24 and 20 acres, respectively. The remaining 11 parcels in the NEW Prosperity Center are as large as 15 acres, leaving plenty of room for growth and expansion. Rosin said Albany officials have told him the manufacturer hopes to expand its Kaukauna operations even further in the next few years. It’s been a streak of good fortune for city planners and developers in Kaukauna, where four commercial parcels have recently been sold at the city’s highly visible Commerce Crossing, an emerging development on the site of the former Fox Valley Greyhound Racing Park at the State Road 55 interchange with highway 41. Appleton has seen a tremendous amount of growth in its Northeast Business Park, although only two of the more than 15 developments constructed there in the past 24 months have been light to heavy industrial. The other developments – all located to the north of where Highway 41 passes the Northeast Business Park – have been professional office, hospitality or medical/dental facilities. Perhaps surprisingly, much of the new construction of light to heavy industrial facilities has occurred west of Appleton, said Jim Schlies, vice president of economic development for the Fox Cities Chamber of Commerce & Industry. “Most of the development in new manufacturing construction has been out in the townships,” said Schlies, who noted that industrial development occurring in the towns of Greenville and Grand Chute – perhaps some of the most prolific recent new manufacturing construction – has occurred in industrial parks owned by private developers rather than the municipality. As Appleton is running out of space in its Northeast Business Park, Little Chute is arguably best positioned to benefit from new manufacturing growth, Schlies said. This past fall, Little Chute officials established a tax incremental finance district to fund improvements and create a new industrial park on 234 acres of land along Evergreen Drive on the village’s north side. The property is well situated along Highway 41 and is roughly halfway between Green Bay and Oshkosh. Off the State Road 441 beltline around the south and east sides of the Fox Cities, Menasha’s industrial park on Midway Road across the road from the University of Wisconsin-Fox Valley is nearly filled after being established in 2000. Just five lots totaling nearly nine acres are available in the park, according to Greg Keil, community development director for the City of Menasha. Advanced Tooling Systems had relocated into a newly constructed 30,000-sq. ft. plant in the Menasha industrial complex in mid-2006, and Oshkosh Truck Corp. built a 10,000-sq. ft. data center in early 2007 to support its growing operation. Neenah’s Southpark Industrial Center has become home to more than 75 businesses since it was developed in 1983. It’s expanded three times in 25 years for a total of almost 300 acres, but nearly all of that prime industrial land has been developed with the exception of about 10 acres, said Robert Buckingham, community development director for the City of Neenah. In response, the city is undergoing a fourth expansion phase in the industrial park, purchasing 60 acres to the south of County Road G. Buckingham said development of roads, sewer and water, and electrical and communications infrastructure is currently underway, with the first of the new industrial lots available this coming spring. Vacant manufacturing space isn’t too widely available in the Fox Cities, Schlies noted. According to Grubb & Ellis/Pfefferle’s Industrial Market Trends Report for the second quarter 2007 – the most recent report available – vacancy rates for industrial and warehouse properties across the Fox Cities are hovering right around 11.5 percent. While no property owner wants empty space to go unused, the lack of vacant manufacturing space can be a disadvantage when a company wants to move into the area or expand immediately and can’t identify a suitable space. Sometimes the delay associated with new construction can break what might otherwise materialize into a deal. Thill Logistics of Neenah, for example, moved into Kimberly-Clark Corp.’s former South Plant on Byrd Avenue in Neenah. The move began last October, and Thill is gradually taking over the 384,000-sq. ft. facility as Kimberly-Clark moves its equipment and materials out of the plant. Kimberly-Clark’s 800,000-sq. ft. Lakeview diaper plant, which ceased production in early December, will face vacancy as the company begins to move out in early 2008, though the property has been listed for sale or lease for the past few months. The effort attempted to emulate a long tradition of industrial spec building success in Oshkosh through its industrial development agency, Chamco Inc. Spec building programs for an economic development agency can offer an opportunity for revenue, but also come with an offsetting risk. In North Fond du Lac’s Northgate Business Park, the spec building was developed because the area had no empty manufacturing facilities in the range of 40,000 to 60,000 square feet, said Brenda Hicks-Sorensen, president of FCEDC. The 60,000-sq. ft. flexible use manufacturing and warehouse facility was completed in December. Even though it hadn’t been leased or sold as of late December, the facility has already helped the FCEDC achieve some of its goals, Hicks-Sorensen said. Site selectors from outside the area calling on Fond du Lac and looking for a medium-sized industrial space now have reason to investigate Fond du Lac further. Even if the spec building doesn’t end up fitting their needs, the site selectors may stick around to investigate other opportunities in the community. “It’s doing what we want it to do as a business attraction tool,” Hicks-Sorensen said. The City of Fond du Lac itself is embarking on its newest and largest industrial park to date, the 276-acre Fox Ridge Business Park, located on the city’s far south side at the newly constructed interchange of U.S. Highways 41 and 151. The city bought the land back in 1996, recognizing that it would likely be 10 years later before the community needed additional industrial park space, said Wayne Rollin, community development director for Fond du Lac. During the past two years, sewer and water had been extended out to the property. During 2008, the city will develop the northern 110 acres of the site, Rollin said, spending about $2.5 million to install streets, lighting, water and sewer, and natural gas and electrical infrastructure. The development of Fox Ridge comes as Fond du Lac’s existing industrial parks are nearing capacity – only three small lots remain in its West Industrial Park, and seven lots remain in its Southwest Industrial Park, which was developed in 1991. Once completed, the Fox Ridge Business Park should prove an ideal setting for companies who need Highway 41 access and visibility. “You couldn’t ask for a better situation in terms of transportation and you couldn’t ask for a better situation in terms of marketing,” Rollin said about the opportunities businesses have at Fox Ridge. City officials have been negotiating with Chicago Tube & Iron to construct a 120,000-sq. ft. steel warehouse and distribution facility, which could prove the first resident of Fox Ridge. In the western Fond du Lac community of Ripon, city officials acquired an additional 56 acres of property in early 2007 to expand its growing industrial park. The city created a new TIF district to fund the infrastructure improvements planned for the property this coming year. Three years ago, the city expanded its Southwest Industrial Park by an additional 300 acres, making it an attractive destination for companies like Mercury Marine and Viking Electric, who both built new facilities during 2006. Much of Oshkosh’s new manufacturing construction has occurred most recently in its North Industrial Park, where producers like Shallbatter Inc. and Roll Expert built facilities during 2007. A warehouse and distribution center for Culligan water systems is currently under construction in the park. |