South Carolina: A Sweet Spot in the Southeast
Several new developments in South Carolina are helping to advance the state’s economy.
The recent announcements of several new business parks and a major automotive plant expansion in South Carolina send a clear message: The state is a prime location in the Southeast for business. One of the parks helping to contribute to South Carolina’s attractive business climate is a 750-acre industrial project in Berkeley County, SC. Dubbed the Charleston Trade Center, the park is being developed by Hillwood Investment Properties, one of the top residential real estate developers in the country. The site is planned for approximately 13 buildings, with eight to nine million square feet of industrial space and approximately one million square feet of office/retail space. The project will create about 3,000 new jobs, and Hillwood will invest approximately $9 million on traffic improvements in and around the Jedburg Interchange.
Another park development is being undertaken by Jafza International in Orangeburg County, SC. The company has acquired 1,300 acres of land, which it will use to create a logistics and business park. Jafza’s investment of about $600 million will help to transform the county into a major logistics hub, and create 8,000 to 10,000 jobs over the next decade, and attract around $1.2 billion in private investment. The Orangeburg project is the Dubai-based company’s first in the United States. Construction is slated for early 2009.
Both of these parks boast easy access to the state’s ports, highways, and railways. Charleston Trade Center is less than 30 highway miles from each of the Port of Charleston’s four terminals, while the Jafza site is located in Orangeburg’s Global Logistics Triangle, formed by highways I-26, I-95, and 301.
The Port of Charleston is expanding to meet the short- and long-term needs of its clients. Port expansion is happening in three ways: efficiency improvements, expanding existing facilities, and constructing new facilities. While demand for distribution center (DC) space near ports is growing fast, the good news is that there is still time to get into these developments as their buildings initially hit the market.
“Hillwood and Jafza could have chosen to locate anywhere,” says Rusty Reed, vice president for business development of the South Carolina Power Team, which provides affordable, reliable power as well as professional, personalized, and confidential site selection counseling for the state. “That they chose to locate along South Carolina’s I-26 and I-95 corridors speaks volumes about the area’s business-friendly climate and global reach.”
BMW Expands in Upstate South Carolina
On top of these recent park announcements, the state also scored a major automotive plant expansion project from BMW. The company announced in March its plans to add 1.5 million square feet and 500 new jobs to its Upstate South Carolina factory. The $750 million investment is the largest ever announced for the Spartanburg County plant, increasing investments by BMW in the state to $4.2 billion.
The three-year construction project includes a new 1.2-million-square-foot assembly facility north of the existing factory to accommodate the next generation BMW X3 Sports Activity Vehicle. In addition, the paint shop will expand by about 300,000 square feet. The existing body shops will be renovated as well.
After the expansion, the Spartanburg plant will manufacture the BMW X3, X5 Sports Activity Vehicle, and X6 Sports Activity Coupe, and their respective variants for world markets. The company plans to increase overall production capacity at the plant from 160,000 units to 240,000 units by 2012.
“The boost in the production capacity at BMW Manufacturing will positively impact the logistics, supplier, and distribution networks that support the manufacturing processes,” says Josef Kerscher, president of BMW Manufacturing.
While the supplier network may grow, existing suppliers will ramp up operations to provide automotive parts for the higher production levels, doubling parts container traffic and significantly increasing exports through the Port of Charleston.
When BMW Group announced in 1992 that it would build its first full manufacturing facility outside of Germany in South Carolina, the company pledged to invest $600 million, to employ 2,000 associates by the year 2000, and attract at least nine suppliers to the state.
By the year 2000, BMW had grown to more than 3,000 employees, and by 2004 that number grew to more than 4,600. Within that same time frame, in order to provide greater flexibility, BMW began to employ contract workers for specialty and administrative services. As BMW entered 2008, the number of on-site workers, including BMW associates and contract workers, grew to more than 5,400, with a total payroll of more than $450 million annually. In addition, BMW has a contingency workforce of about 900 workers, with an average annual payroll of more than $50 million.
Today, BMW has invested approximately $3.5 billion in its South Carolina operations. In addition, 52 automotive suppliers are located in the state, and 40 of those 52 suppliers have chosen to place new North American operations in South Carolina to partner with BMW. BMW’s North American supplier network has grown from 22 companies in 1992 to 194 companies today.