Marketing Tool Provides In-depth Intelligence on Potential Investors

Buffalo Niagara Enterprise recently secured access to fDi Markets, which is a service of the Financial Times. It is a comprehensive online database of cross-border greenfield investments, covering the last decade in all countries and sectors worldwide. This service provides access to real-time monitoring of investment projects, capital investment and job creation. It also tracks and profiles companies investing overseas, and conducts in-depth analysis to uncover trends.

fDi Markets will enable us to:

  • Improve lead generation/identify target companies by allowing BNE to develop a robust pipeline of potential investors within our target sectors and receive instant alerts on companies that are planning to invest abroad.
  • Profile active investors through its profiles of over 60,000 active investors. This will allow BNE to better understand a company’s cross-border investment strategy: where they have invested to date; the types of projects they have invested in; key contact people within the organization and future expansion plans.
  • Develop our investment promotion strategy using trends analysis to understand the size, potential and composition of source markets and sectors.  This will enable BNE to develop strategies on the actual size and growth of the greenfield market.
  • Produce in-depth analysis of key markets and sectors through fDi’s comprehensive trend analysis of each location and sector that BNE targets – including who the key investors are, motives driving investment, key competitors, and more.
  • Evaluate our performance against competitors and “best in class” locations using the number and size of projects secured. We will use this information to benchmark our performance against both competing and “best in class” locations within key sectors and source markets.
  • Enhance our marketing and public relations efforts by using fDi Markets’ data in our press releases and marketing materials.
  • Prepare for overseas investment missions by generating a list of target companies to meet with while on overseas investment missions via fDi’s extensive database.

We believe that the intelligence and research provided by fDi will be a great enhancement to our marketing efforts.  For more information on their comprehensive services, visit www.fdimarkets.com.

By Graham Smith, BNE Research Director

Bright Buffalo Niagara Shines Light on Entrepreneurship

On October 29, 2014, during 43North Week, a spotlight event promoting investment, partnership and entrepreneurship was held at the University at Buffalo Clinical and Translational Research Center on the Buffalo Niagara Medical Campus. In collaboration with 43North, Bright Buffalo Niagara invited 43North semifinalists from across the globe to exhibit at the Bright Buffalo Semifinalist Meet-Up and mix and mingle with venture capitalist and angel investors.

The results equal success:

Bright Stats

 

Since 2009, Bright Buffalo Niagara has partnered with local investors and entrepreneurs to nurture economic growth in Western New York. Bright works to serve software/IT, medical devices, biotech, drug development and manufacturing industry sectors. To date, Bright participants have raised more than $23M in funding. Learn more at BrightBuffaloNiagara.com

Global NY Helps Advance Western New York’s Economy

In his 2014 State of the State address, Governor Cuomo introduced Global NY to Round IV of the Regional Economic Development Council (REDC) initiative. Global NY has two complementary economic growth objectives: to attract international investment and jobs and to provide New York businesses with the tools and assistance they need to export their products to the international marketplace.

The REDCs were asked to develop and implement Global Marketing and Export Strategies, incorporating foreign trade and investment approaches into regional planning efforts. BNE President and CEO, Thomas Kucharski is chair of the Western New York Global NY initiative. Chris Scalisi of World Trade Center Buffalo Niagara and BNE’s Graham Smith assisted Empire State Development’s WNY regional office with drafting the following regional strategies for increasing exports and foreign direct investments (FDI) in WNY:

• Retain international university graduates and leverage their personal networks to attract trade and investment.

• Leverage the growing foreign-born population to attract FDI and develop new business relationships in overseas countries.

• Identify the business intelligence and international export needs of regional companies to discover trade and reverse missions.

• Create an international marketing brand that focuses on available assets, excess capacity, and international brokerage support services already available across Upstate NY.

• Unite the region around a competitive identity and communicate a consistent message to the world.

• Generate high quality business attraction leads that would not have considered the region otherwise.

• Make the location decision process for foreign companies easy and risk-free.

• Brand and market Upstate NY as a trade gateway to attract overseas trade and investment.

The initial phase in executing this plan will engage regional stakeholders to provide input and expertise. The second phase will include analyzing our brand and how it plays in the global marketplace. We will use that knowledge to target European and Asian markets where we have had success in the past. The final phase will fully implement the strategies and identify growth markets and industries. Western New York is well positioned to be a competitive global force, a center for exports and foreign direct investment.

By Graham Smith, BNE Research Director

Next Generation Manufacturing & Workforce Development

Several innovative programs have been or will be launched in Western New York designed to enhance and improve the talent pool for regional employers, especially manufacturers, for years to come. These new workforce development programs bolster training efforts available at community colleges as well as the vocational programs offered through Buffalo Public Schools and Erie 1 BOCES.

Here are the workforce development programs that will be game-changers for manufacturers relocating to Buffalo Niagara.

Dream It, Do It WNY’s (http://www.didiwny.com/) mission is to introduce middle and high school students to careers in manufacturing and they’ve been successfully doing so for several years. Its goal is for more young students to choose education paths that will guide them into skilled trades and other critical support roles necessary for advanced manufacturers. Ideally, it will result in a deeper talent pool as these students graduate through the system. Dream it, Do it WNY encompasses school districts, colleges and manufacturers in Erie, Niagara, Allegany, Chautauqua and Cattaraugus counties.

Already underway, and projected to increase in size and scope over the next five years, is the Buffalo Manufacturing Works. The facility will “provide technology solutions to companies across the manufacturing industry through world-class engineering support, research and design, training and strategic services” (http://buffalomanufacturingworks.com/). The Manufacturing Works is partially funded by a $45 million investment by New York State as part of the “Buffalo Billion” pledge from Governor Andrew Cuomo and will help manufacturers to research and innovate new products, improve productivity through “process excellence,” develop new export markets for their products and cultivate a highly skilled workforce.

Currently in the planning phase, the Regional Workforce Advancement Center (http://www.bizjournals.com/buffalo/news/2013/05/02/manufacturing-training-center.html) will open in Buffalo thanks to additional investment from New York State. This facility will be exclusively focused on workforce development, especially the replacement of thousands of baby boomer employees who will retire over the next several years.

These are exciting times for the next generation of skilled workers as well as adults looking for new opportunities in tomorrow’s manufacturing jobs.

 

15 Winning Years for Western New York

To view BNE's most recent results, check out our 2013/14 Annual Report

To view BNE’s most recent results, check out our 2013/14 Annual Report

Since our inception in 1999, BNE has worked to attract more than $3.5 billion in new business investment to the region.  That figure accounts for 319 projects, with an impact of nearly 41,000 jobs either pledged or retained.

Here are some highlights:

Alpina was started in 1945 in Sopo, Colombia and produces more than 500 consumer products including baby foods, juices, cheeses, smoothies, and yogurts.  In March 2011, Alpina announced its first U.S. manufacturing facility focusing on Greek yogurt products.  Alpina USA now has 83 full-time employees making a variety of products in their brand new $16M facility located in the Agribusiness Park in Batavia, NY.

Fichman Furniture, founded in Scarborough, Ontario, manufactures custom wooden radiator covers.  In June 2012 they purchased their first U.S. industrial building in Holland, NY and pledged to create 15 new jobs over five years while investing $3M into the new facility.  After only two years, the company employs five full-time workers and has seen sales exceed expectations thanks to its U.S. location.

GEICO opened a WNY office on March 8, 2004 with just 75 employees and a long-term goal of having as many as 2,500 associates within 15-20 years. GEICO eclipsed 2,500 associates in June 2013 and, a decade after opening, the office is now home to more than 2,700 associates with plans to add another 700 employees this year.

Greenpac Mill is a partnership between Cascades Inc. and three other partners.  In June 2011, the company pledged to create 108 jobs and invest $400M in a new facility.  They built a state-of-the-art containerboard mill in Niagara Falls, manufacturing lightweight linerboard from 100% recycled fibers.  Today, the company employs 130 full-time employees with two shifts on a four-shift rotation.

Nutrablend Foods is a Canadian based company and the leading manufacturer in the sports nutrition and nutraceutical industries.  Headquartered in Cambridge, ON, in October 2009 they located to their first U.S. manufacturing facility in Lancaster, NY.  Pledging to create 40 new jobs in the first five years and invest $1M into building and equipment, they now have 134 employees running two shifts daily.

Muller Quaker Dairy, formed in 2012, is a joint venture between PepsiCo and the Theo Muller Group.  The company opened a state-of-the-art yogurt manufacturing facility on 82 acres in Batavia.  Pledging to create 186 new jobs and invest $206M into the facility and operations, they currently employee 172 full-time employees and make three yogurt varieties.  Muller Quaker Dairy was recently named Northeastern Economic Developers Association’s (NEDA) project of the year.

US Off-Track is a licensed account wagering service provider and management company serving the thoroughbred, harness and greyhound racing industries.  With a corporate office in Florida and call centers in Portland, OR, and Amherst, NY, the company announced a new Amherst location in October 2011. Pledging to create 80 jobs and invest $750,000 into the new facility, just three years later they employ 63 people and operate six days a week.

Welded Tube, headquartered in Concord, ON, announced their newest U.S. location to be built in Lackawanna, NY in October 2012.  Welded Tube USA is a leading manufacturer of cold-formed tubing products that are distributed throughout North America.  The company pledged to create 121 new jobs and invest $48,250,000 in their new facility.  After only two years, they employ 60 full-time workers at the former brownfield site.

Yahoo! announced plans for their Lockport, NY data and internal operations center in 2009.  Phase 1 was completed in March 2011 with the opening of a 190,000 sq. ft. facility employing 90 technicians and engineers.  Announced in 2013, Yahoo’s Phase 2 expansion is underway and includes an additional 236,000 square feet of data center and 35,000 square feet of administrative space that will house 115 employees for Yahoo’s Customer Experience Center.

43North Semifinalists Are All Winners At Bright Buffalo Meetup

43N14019_43NWeekLogo_D6

by Jenna Kavanaugh, BNE Marketing & Communications Director

In May 2013, the New York Power Authority (NYPA) trustees approved $5.4 million in funding for the 43North global business idea competition. The award came from a recommendation by the WNY Power Proceeds Allocation Board (WNYPPAB) to attract entrepreneurs to compete for an unprecedented $5 million in prizes.

I’ve been pleased to be part of the 43North team throughout the process. It’s crunch time as we head into the finals having scoured thousands of ideas submitted from February through May. Judges have narrowed it down to 113 semi-finalists, and at the end of September eleven finalists will be announced to advance to the final round of the competition.

As part of the excitement and anticipation such a competition presents, Buffalo will host “43North Week” from October 24th through October 30th, with a series of events and educational opportunities.  This includes everything from a startup pitch competition, to a coding workshop, to an evening of networking in the eclectic cafes, clubs, galleries and music venues of Allentown.

One of the week’s most anticipated events is the Bright Buffalo Niagara Semifinalists Meet up, on October 29th.  All 113 semifinalist companies are given the opportunity to meet and mingle with venture capitalists and angel investors and learn more about local resources that promote investment, business partnering and other startup services.  It will be held at the University at Buffalo Clinical Translational Research Center spotlighting life sciences innovation and technology based economic development in the heart of the Buffalo Niagara Medical Campus.

The big finale takes place on Thursday, October 30th, when the eleven finalists will pitch their ideas to a panel of judges in front of a live audience at Shea’s Performing Arts Center.  One business will be awarded $1 million, six will receive $500,000 and four will receive $250,000.  The public is invited to attend the awards celebration that evening to experience first-hand the excitement generated by the competition.  It will be an unforgettable evening, I’m sure. For more information about 43North or registering for the reception, please visit www.43North.org.

Workforce Development Programs Key to Region’s Continued Progress

by Tom Kucharski, President & CEO

On August 5th, I had the pleasure of representing BNE at the 2014 White House Forum on Economic Development, hosted by the International Economic Development Council (IEDC) and SelectUSA. This provided an opportunity to directly engage with White House and high-level administration officials, as well as colleagues and IEDC leaders. Despite some well-documented congressional “gridlock,” SelectUSA is one program that everyone can agree on and is providing much-needed centralized services to potential foreign investors.

I was struck by the progressive and open-minded nature of this group and how receptive they are to helping organizations across the country create solutions to a variety of challenges. Discussions and forums focused on economic strategies and common concerns – specifically, the critical need for better workforce development training programs and initiatives.

In Buffalo Niagara, we’re faced with two considerable hurdles: an aging workforce and a deficit in employees prepared for the high tech and advanced manufacturing industries we strive to attract. One key takeaway from the conference is the critical need for institutions of higher learning to collaborate with the business community to create job-training programs for the 21st Century because this industry cluster is where the jobs are now and will be in the future.

The good news is thanks to an open dialogue with the educational institutions in our region as well as the pool of talent they attract, we have a golden opportunity to create the kind of meaningful job training programs that are in sync with today’s businesses’ workforce needs and tomorrow’s jobs. And that’s good news for BNE’s investors and all of Western New York.

Canadian Businesses Consider Real Estate in Buffalo Niagara

By Steve Blake, Partner at CBRE Buffalo

Real estate availability and cost is an important topic for Canadians considering a business expansion.  The real estate markets in Toronto and Buffalo Niagara differ greatly and as the US economy continues to change, it leaves business owners uncertain.  Companies are unsure of the availability of commercial properties, average lease rates, and the current trends specific to the Buffalo Niagara region.  And how does Buffalo Niagara compare to the US real estate market?  Have the prices plummeted?  Is there a glut of properties just waiting for tenants and buyers?

CBRE|Buffalo publishes a MarketView report every year summarizing the real estate market in Buffalo Niagara.  Here are some excerpts from the Annual 2013 report:

Industrial Market

As forecasted in 2012 by CBRE|Buffalo, the 2013 Buffalo Industrial Market did experience a sizeable decrease in the overall vacancy rate, decreasing from 9.2% to 5.7%.  This equates to 2,482,446 sq. ft. being absorbed in the greater Buffalo MSA.  Nationally, demand for industrial space continued to improve with the national overall vacancy rate decreasing 13.1% to 11.7% in the third quarter 2013. (CBRE, INC U.S. Industrial Market View Q3 2013).  The 2013 results mark the 8th consecutive year the Buffalo Industrial Market vacancy rate has remained below the national average.

Industrial RE Chart
* The arrows are trend indicators over the specified time period and do not represent a positive or negative value.

(e.g., absorption could be negative, but still represent a positive trend over a specified period.)

Office Market

The overall Buffalo office market vacancy increased to 13.71%, up from the previous year’s 10.37%. The expected increase comes after HSBC’s downsizing, which resulted in its departure from One Seneca Tower (formerly One HSBC Center) leaving more than 700,000 Sq. ft. vacant in Buffalo’s Central Business District (CBD). Despite the increase in vacancy, the submarkets displayed positive net absorption of 163,137 sq. ft. of office space, offsetting the spike. As in previous years, the Buffalo market continues to fall below the national office vacancy of 15.1% reflecting a relatively stable market. (CBRE, Inc. U.S. Office MarketView Q3 2013)

Regardless of the cautious sentiment surrounded by the increase in CBD vacancy, construction is thriving with many new office projects downtown and throughout the suburban markets. The Buffalo office market added over 873,000 sq. ft. of office inventory.

Office RE Chart

* The arrows are trend indicators over the specified time period and do not represent a positive or negative value.

(e.g., absorption could be negative, but still represent a positive trend over a specified period.)

 

Additional questions that Canadian companies commonly ask:

Q: Can we reduce our ‘real estate costs’ by expanding into a less costly market, without jeopardizing our profits or business model? 

A: For many companies it is a resounding YES.

Some simple observations:

Average cost to purchase industrial real estate:

  • Toronto GTA (Greater Toronto Area) :   $81.92 psf. *
  • Buffalo/ Erie County:   $26.61 psf. ** = savings of approx.   68% per square foot.

Average additional rent charges for real estate taxes, common area maintenance and insurance, industrial leases:

  • Toronto GTA:                     $3.10 psf *
  • Buffalo/Erie County:       $1.76 psf ** = savings of approx. 43% per square foot.

Cost to purchase fully serviced industrial land:

  • Toronto GTA: approximately $275,000 per acre to $400,000 per acre
  • Buffalo/Erie County: approximately 45,000 per acre to $60,000 per acre = savings of approx. 84% per acre.

NOTE: Similar percentage savings also apply to the office market.

Q: Can we potentially reduce not just our real estate costs but our ‘overall occupancy costs’ including but not limited to utility costs, real estate taxes, sales taxes, employee wages and costs, through available economic incentive programs?

A:  Ontario/Toronto – no.

New York/Buffalo – yes.

In United States and specifically in the Buffalo Niagara Region companies of all different sizes can apply and potential qualify for incentives programs to assist with utility costs, real estate taxes, sales taxes, employee wages and costs.  Most of these programs’ main criteria are based on the number of new jobs being created, the projects’ costs and plans, and the specific industry the company operates in.  Companies need to complete an application process and potentially compete for some of these programs.

There are significant differences between the real estate markets in Buffalo Niagara and the Toronto GTA.  Furthermore, the Buffalo Niagara real estate market has fared relatively well over the past year, even in tumultuous times across the country.  While these statistics and figures provide some great information, they are no substitute for feet-on-the-ground.  So why not head south to see what opportunities the Buffalo Niagara real estate market may hold for your company?

 

CBRE|Buffalo, an affiliate office of CBRE, Inc., staffs 16 professionals and offers a full range of commercial real estate services to Erie, Niagara, Chautauqua, Cattaraugus, Wyoming and Allegany counties, and portions of Orleans and Genesee counties. Our industry-leading platform provides unparalleled service to meet any client requirements including: landlord/owner representation, tenant/buyer representation, property and project management, investment sales, consulting, and marketing and research services

For additional information contact Steve Blake, CCIM, Partner at 716-362-8707 or steve.blake@cbre.com

*     Source: DTZ Barnicke Q1 2012 Industrial Market Report

 **   Source:  CBRE Buffalo