3 Ways Buffalo, NY Impresses Brazil-based Start-up

Joox

As one of the most rewarding parts of my job, I play host to companies when they visit Buffalo Niagara undertaking due diligence in their site selection process.

Recently, four representatives from Joox, a Brazil-based technology startup, spent six days in the region as they prepare to establish their first US location. The group shared with me their thoughts on the Buffalo Niagara region:

Impressive start-up community – on the day the team arrived, the University at Buffalo (UB) hosted its Commercialization Lecture Series, featuring a panel of seven companies that have found success through New York State’s Start-Up NY tax incentive program. The program offers companies significant tax benefits, but also the opportunity to partner with academic institutions. Joox is approved for Start-Up and this panel provided ideas and insight for their collaboration with UB. Over their weekend stay, the group attended – and presented at – Buffalo Unconference, a gathering for people to share and learn in an open environment. Unconference gave the Joox team another look into the flourishing start-up community that calls Buffalo home. They expressed how excited they are to become members of this burgeoning community.

Welcoming business community – as a primary part of their visit, the Joox team met with nearly a dozen companies in the Buffalo area to explore potential partnerships and collaborations. The team was thrilled by the high caliber of private sector companies, and also with how excited each company was to represent not only themselves, but the talent, expertise and creativity of the region. The Joox team commented on the discernible pride that each of these individuals showed in their community.

Great place to live – Whether showing the livable, walk-able community that is the Elmwood Village, bustling with great restaurants and retail, or experiencing the power of Niagara Falls for the first time, there is nothing more rewarding than hosting people in our region, especially when they come from different parts of the world. Two of the company employees are moving from Brazil to Buffalo and bringing their families. They had a chance to tour neighborhoods, enjoy local fare, and experience the spectacular sites and attractions they can enjoy when they move here.

Buffalo was one of four stops on the Joox’s team’s trip across the US. Here is what one of the team members emailed after their visit:

We are in San Francisco right now, we´ll be heading back to Brazil Tuesday afternoon. We had some really good meetings here and in other cities, but nothing compared to what we´ve achieved in Buffalo. I am happy to see that Buffalo offers the best options for the partnerships that we need for this beginning. Buffalo, in many ways, is the best city I have visited in the US so far (and I have been to at least 10 great ones).

All indications are that they will be setting up their office here in the Buffalo Niagara region sometime this year. Their time spent here was productive and welcoming thanks to our supportive start-up and business community.

by Alan Rosenhoch, Business Development Manager

New York State Tax Reform Benefits Manufacturers

International companies that expand into the U.S. often apply for and receive major tax incentives.  But what if the tax law were amended to create a significant incentive across the board, without companies even having to apply?  Well, that is exactly what New York State has done.

On March 31, 2014 New York State enacted significant changes to reform its corporation tax laws, most of which took effect January 1, 2015.   Many of the changes are aimed at simplifying an overly complex system of taxation and include the elimination of some taxes and revisions to the tax bases.    Included in the corporate tax reform are changes that will greatly benefit qualifying New York State manufacturers by reducing the income tax rate to 0% and creating a 20% real property tax credit.

To qualify, a manufacturer must have property in New York that is principally used by the taxpayer in the production of goods by manufacturing, processing, assembling, refining, mining, extracting, farming, agriculture, horticulture, floriculture, viticulture or commercial fishing and during the tax year more than 50% of its gross receipts are derived from the sales of goods produced by these activities.

To be eligible for the zero percent tax rate the manufacturer must have either:

1) property located in New York with an adjusted basis for federal income tax purposes at the close of the taxable year of at least $1 million; or

2) all of its real and personal property is located in New York.

The zero percent tax rate applies to the business income tax base and is only available for qualified manufacturing corporations taxed under Article 9-A, franchise tax on business corporations.

The real property tax credit for qualified manufacturers is a credit equal to 20% of real property taxes paid during a tax year for real property located in New York and principally used in manufacturing.  The property can be owned or leased by the taxpayer.  Leased property must be leased from an unrelated third party.  The lease must be in writing and require the lessee to pay the real property taxes. The lessee must make the real property tax payment directly to the taxing authority.

For those that are not qualified manufacturers, the tax rate on business income will be reduced from 7.1% to 6.5% beginning January 1, 2016.

The legislation is a huge step forward for encouraging businesses to expand and grow in New York and it doesn’t stop there.  New York offers a number of attractive incentive programs available at the state and local levels to help businesses locate and grow here.  Additionally, there is no sales tax on machinery, equipment, tools or supplies used in manufacturing and New York State does not have a personal property tax on inventories, machinery and equipment either.  

 

Guest blog: Andrew J. Toth, CPA, Partner at Tronconi Segarra & Associates, LLP, atoth@tsacpa.com ,(716) 633-1373

Spreading #Buffalove

BNE-PostcardCampaign-recap

Over the past few months BNE helped send a little bit of #Buffalove across the world.

Starting in November 2014, Buffalo Niagara locals could tell friends and family that “Someone in Buffalo Niagara Misses You” in postcard form for free by visiting www.wherelifeworks.com and submitting names and mailing addresses of family and friends living outside the region.  BNE hand-addressed, stamped, and mailed the postcards.

The idea behind the “Someone in Buffalo Niagara Misses You” campaign was to connect with expats and others residing outside the area and entice them to learn more about living here. The postcards spurred positive conversations about the transformation of our region.

BNE designed three unique postcards, representative of the different months they were sent. Each card featured a Buffalo composed of different elements: fall leaves for November, ginger snap cookies for December and confetti for January.  The back of the postcard featured facts about the region.

During the campaign, www.wherelifeworks.com received 2,300 visitors and we sent nearly 1,000 postcards to 49 U.S. states and nine international countries including; Australia, Canada, England, France, Ireland, and Kyrgyzstan.

This simple idea went a long way, literally traveling thousands of miles.  We hoped those who received the postcards enjoyed them as much as we did sending them out.  Now it is time to think of the next innovative way to spread the #Buffalove! Share your thoughts with us.

BNE-PostcardCampaign-recap2 (3)

By Megan Savage, Marketing and Communications Specialist

Powerful Utility Savings a Plus for Canadian Companies

Many Canadian companies considering US expansion are heavy power users and electricity costs can easily eat away at profits.  As Canadian companies seek US expansion for many reasons (made in USA requirements, supply chain, bridge issues/delays, etc.), being able to manage operating costs is yet another major consideration.

When BNE is working through the due diligence process with a prospective company, energy needs and consumption are discussed.  With a large power user, we typically run a comparison between Canadian costs for monthly usage and what the same usage would cost in Buffalo Niagara.  The company shares its current electric bill and our local utility runs the numbers.  Most times there are significant savings.

Many of the larger power users are companies in plastic injection molding or extruding, food processing, or steel processing and fabrication.  A recent example is a plastics company that currently pays $0.13 per kWh for power in Canada. By comparison, they would pay an estimated cost of $0.082 per kWh for that same operation in Buffalo Niagara and realize a savings of over $18,000 each month. A different plastics company could save more than $20,000 per month by reducing their electric costs from $0.14 per kWh to $0.098 per kWh. We were able to identify over $50,000 in monthly savings for a food processing company currently paying $0.19 per kWh for electric.  Their pricing in Buffalo Niagara is estimated at $0.083 per kWh.

Steel processing in Buffalo Niagara.

Steel processing in Buffalo Niagara.

In addition to standard utility savings, companies may also qualify for special incentive programs that further reduce power costs. New York State offers some programs and others are administered by the local utility.  Many are contingent upon the number of new jobs that the company will be creating and the total investment into the new facility.  Prospective companies should consider these programs once they have identified a potential building or land site.   Thanks to our ability to offer low-cost power, selecting Buffalo Niagara for US expansion can make great economic sense for our Canadian neighbors.

by Carolyn Powell, Business Development Manager

It’s Happening Now! Check out the New Buffalo

This short video (Paget Films) shows some of Buffalo Niagara’s newest developments and captures the region’s momentum and energy. Nice job Western New York Regional Council and ESDC. Check it out!

New Buffalo,NY Development Maps

New Downtown Buffalo, NY Developments Maps Now Available

New Downtown Buffalo, NY Developments Maps                Now Available

As 2015 settles in, what better time than to revisit and update our downtown Buffalo, NY development maps. The past few years have been a watershed for the economic momentum of the region and downtown Buffalo is receiving the brunt of the benefits. As usual, we updated two maps. The first shows the projects classified by status (Under construction, Proposed, & Completed), the second captures that information as well, but organized by project type, (Buffalo Billion, Office, Mixed use, Hospitality/Tourism, Medical, Residential, Other).


Buffalo, NY Downtown Development Maps:


As always, this information is gathered from a variety of public sources, focusing on projects with a minimum of $1,000,000 in investment. Any omissions are oversights, and feedback is always welcome!

by Christopher Finn, Research Manager

10 Years of BNMC Development

There’s been no shortage of development happening on the Buffalo Niagara Medical Campus (BNMC) the last 10 years with plenty more to come. According to the BNMC, two million square feet of development has recently been completed and almost two million square feet more is under construction. Significant streetscape enhancements are nearly finished including 44 signature signs throughout the Campus and informational kiosks with maps located at major pedestrian areas.

Click on the ’10 year graphic’ below to view pdf of past development.  Also coming soon:

Development is funded by an investment of nearly $750 million in private, public, and philanthropic dollars. 5,000 more employees to the Medical Campus is estimated by 2017.

10 year BNMC Development

Cars on Main are Driving Development

Decades ago there was a vision for downtown that included a bustling multimodal transit system. While the NFTA’s Metro Rail System remains one of the country’s most heavily used per-mile light rail systems, there were unforeseen consequences. Many blame Main Street’s decline on the lack of vehicular access and believe economic development in the city’s core has been stifled since cars were removed in 1982.

Main-BeforeAfter-10_22_14-2

Click image to see photos on Facebook

Fast forward 20 years and that thinking has shifted. In 2010, the Cars Sharing Main St. project team was assembled and a new directive was issued:  allow cars to share the track bed with the light rail cars and bring people back to Main St.  Construction is advancing with the 700 block was completed in 2012, the 600 block is near completion, and the 500 block is in the midst of reconfiguration.

The $30,000,000+ million project is intended to be a catalyst for change on a once bustling stretch of commercial activity that has lagged behind the momentum of downtown development.  Even before the project is complete, developers are seeing its potential. Mixed-use development projects are popping up among adaptive reuse projects, bringing high-end offices to once darkened storefronts. Groups like Carmina Woods Morris and Ricotta & Visco led the charge as more continue to secure space, capitalizing on increased access. Huge projects like the $42,000,000 Tishman Building transformation to a Hilton Garden Inn and office space is nearing completion and IBM’s recent announcement to bring 500 people to the south Key Tower will boost Main St.’s profile even further.   New restaurants and cafes are meeting the increased demand resulting from the development happening along downtown’s once-primary thoroughfare and the surrounding Central Business District.

Expectations are high for the reconfiguration and with the projects already underway it is clear that once completed, cars sharing Main St. may be one of the most significant downtown development projects in decades.

By Chris Finn, BNE Research Manager

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.