Deciding where to locate your growing business is one of the biggest decisions you and your company will ever make. Do you stay in your current facility by adding more shifts? Add another building on the current site? Or move to another city or state altogether?
All are important questions, and all must be considered. Among the many issues to be addressed during the expansion or relocation process is transportation. Is yours a business that could benefit greatly from immediate or instant access to air travel?
Airports have become one of the most popular business expansion locations. Of course, not every business can benefit from locating at or near an airport, but many can and do.
Situated about 75 miles northeast of Los Angeles sits Victorville, Calif., home to the former George Air Force Base. The base was shuttered in 1992 as part of a round of military base closures. Now the Southern California Logistics Airport (SCLA), the 5,000-acre site has space for air cargo and rail lines, as well as warehouse and distribution and manufacturing facilities.
The Victorville site offers numerous advantages for companies looking to move goods throughout the United States or the world.
The Pasha Group, a distribution and logistics services company, has been developing a 700-acre facility at SCLA since 2003.
“We believe that population pressures in the Los Angeles Basin will continue to draw industry to cities like Victorville,” said Don McKnight, president of Automotive Services for The Pasha Group. “We fully expect the SCLA distribution complex to take on far greater economic significance and viability, not only for the Los Angeles Basin’s distribution requirements, but also for a much wider geographical area.”
The Pasha Group opened the facility because of the need to relieve space pressures at the busy ports of Long Beach and Los Angeles, according to the company. It is estimated that container and automotive storage occupy 40 percent of the land at each port.
The Pasha Group’s growth plans at SCLA would open up space at those ports by moving container and automotive processing and storage to SCLA. The company operates an auto accessorizing facility in San Diego, where it employs 600 workers.
“Everything we were looking for is [at SCLA],” McKnight told the High Desert Daily Press. “In fact, there’s actually more than we were looking for. The fact that the airport is right here has opened us up to the huge auto parts aftermarket, which relies heavily on air freight.”
SCLA, while a distinct facility all its own, shares many characteristics with other former military facilities across the country. The most obvious, of course, is that these former military bases have buildings and land, along with runways and airport facilities.
For these reasons and others, Leading Edge Aviation announced last year that it would open an airplane painting facility at SCLA. The company could eventually employ as many as 200 workers.
“Our current focus is about 60 percent military, 40 percent commercial,” Mike Manclark, president of Leading Edge, told the High Desert Daily Press. “But we’re growing so fast as a company. We doubled our size in the past four months, so that could change.”
Leading Edge paints both military and commercial aircraft at the facility, which covers nearly 55,000 square feet. United Airlines is using Leading Edge to repaint its entire fleet. All together, Leading Edge paints more than 1,500 planes a year, including stealth coatings on military planes.
KellyUSA Makes the Transformation
One of the most successful examples of a former military facility being converted into an opportunity for business is the former Kelly Air Force Base near San Antonio, Texas. Since the base began to close until its official closure in July 2001, nearly 12 million square feet of property was turned over to the Greater Kelly Development Authority (GKDA).
Of that total, slightly more than 8.2 million square feet is considered usable or leasable at what is now KellyUSA. As of late 2004, 96 percent of that space had been leased to 63 companies. Those firms employ more than 5,000 workers across a variety of industries.
GKDA, the city of San Antonio and the state of Texas are taking steps to ensure that KellyUSA’s growth will continue into the future. Numerous infrastructure improvements to the complex are taking place during the next several years.
In addition, numerous incentive packages are available to expanding and relocating companies. The Freeport Tax Exemption offered by the city of San Antonio and Bexar County give a personal property tax exemption to businesses that deal with goods in-transit or in-process.
KellyUSA is also part of an empowerment zone, which means that companies can receive various wage credits, federal tax credits, tax incentives and bonds for business and economic development.
Other incentives at the base include:
Defense Economic Readjustment Zone: If a company qualifies as an enterprise zone project, it will be eligible for sales tax refunds and discounts on the state franchise tax.
Industrial Revenue Bonds: Companies can finance their projects at or below market rates if the project promotes and encourages employment and the public welfare.
Means the article is accessible only to our magazine subscribers.
