If We Develop It

The latest report from the CBRE Buffalo office sets industrial vacancy rates at a record-low, 4.5%. On the plus side, we can celebrate the fact that there is growing interest in relocating or expanding a business in Buffalo Niagara.  On the minus side, our inventory of existing commercial real estate, especially in the industrial market, is shrinking.  Large, modern, open facilities with high ceilings and other industrial amenities are difficult to identify in any western New York market. Now is the time for local developers to turn their attention to this pressing lack of industrial inventory.

Spec space can be challenging and partially leased space has been difficult to impossible to finance since the recession. While spec space can be a risky and costly endeavor, properly done, it could benefit both the developer and the Buffalo-Niagara region.

Preparing an industrial site for development can take months, maybe years. This means looking both within, and beyond, the city limits, identifying potential parcels that will suit a manufacturing business’s substantial needs — like access to transportation, low cost power, water, parking and more.

The recent spotlight on Buffalo Niagara has led to even more attention from site selectors. Thanks to our industrial past, there is an available and affordable workforce, attractive to out-of-market manufacturers. But without the real estate, our region is going to miss out on golden opportunities that translate to jobs lost for both younger and older workers.

by Steve Blake, CCIM  Partner, CBRE|Buffalo

 

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!

BAK to the Future

Bak USA is a company with a conscience.  A manufacturer of low-cost PC tablet devices and mobile smartphones, its philanthropically minded Danish founders, Ulla and J.P. Folsgaard Bak, formed the company to manufacture affordable devices for underserved countries and also to create jobs and a better life for their employees.  Admirable goals on both sides of the equation.

photo credit: KC Kratt Photography

Ulla and J.P. Folsgaard Bak at Bak USA headquarters in Buffalo, NY.

Based on their track record of success at their first factory in Haiti, the Bak’s sought to set-up a U.S. facility in order to expand and extend their reach.  The operation required a clean room environment where operators could assemble devices in a non-assembly line process from components sourced from China.  Integral to the project’s success was keeping overhead costs to a minimum, ensuring that the end products would be affordable and of very high quality. Access to financial incentives was critical in this aspect.  The Baks came to Buffalo in March 2014, meeting with BNE and the University at Buffalo. In typical BNE style, we rolled out the red carpet, grabbed them by the hand and launched the project into hyper speed. We toured potential sites, familiarizing them with service providers and community leaders as well as the region’s diverse workforce.

Along with our proximity to Canada, New York State Governor Andrew M. Cuomo’s START UP NY program, which offers a ten-year period free of state taxes, as well as personal income tax exemptions for employees, was a major factor in Bak USA’s decision to establish its business in Buffalo.  After touring multiple sites, they selected the Compass East building, located on Michigan Avenue in the former Sheehan Memorial Hospital.  This will become Bak USA’s global headquarters as well as the first PC tablet and smartphone manufacturing facility in the country.  Bak USA will invest $840,000 in this location and expects to create 267 new jobs in total.

New York State Governor Andrew M. Cuomo's START UP NY program, which offers personal income tax exemptions for employees, was a major factor in Bak USA’s decision to establish its business in Buffalo.

New York State Governor Andrew M. Cuomo’s START UP NY program was a major factor in Bak USA’s decision to establish its business in Buffalo.

Currently there are employees from 13 different countries working at the plant, which plays into the company’s dedication to nurturing refugees from other nations, paying workers a living wage, and embracing racial and gender equality.  Students using Bak’s affordable PC tablets across the world benefit from the company’s social responsibility.  And its Buffalo employees are assembling more than affordable high-tech devices – they are building a better future for themselves and their families.

Yancey’s Fancy is ‘Hot Stuff’ in Western New York

Guest blog by Rachael Tabelski, Genesee County Economic Development Center

CSA-7775-DC-012-3

August 2014, Yancey Fancy 112,000 sq. ft. facility expansion in progress.

Yancey’s Fancy, an artisan cheese manufacturer, continues to be one of Western New York’s most prominent food manufacturing companies.  Yancey’s, formerly Kutters Cheese, has been operating as a premier cheese maker in Western New York since the post-World War I era.  Limburger was the first cheese offered from the company and today their award winning products spans over 50 varieties of flavored and natural cheeses.

In 2014 Yancey’s announced an expansion of their existing facility.  The company is building a new 112,000 sq. ft. building at the Buffalo East Technology Park in Pembroke, NY.  Currently the company employees over 100 workers and with this expansion they project 50 new jobs will be added.

To learn more about Buffalo East Technology Park visit the real estate listing on BuffaloNiagaraCLS.com. To learn more about the dairy industry in Buffalo Niagara visit BuffaloNiagara.org and view maps, brochures and more.

 

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

Six Life Sciences Companies will call Buffalo Home

By Alan Rosenhoch, Buffalo Niagara Enterprise

November 12, 2014

43 north winners

The inaugural edition of the world’s largest business idea competition, 43North, has come to a resounding close and 11 winners will now call Buffalo their home. It should come as no surprise that the life sciences industry is very well represented among the winning companies, with more than half operating in this burgeoning sector. With our wealth of industry assets and the growth of the Buffalo Niagara Medical Campus, it’s clear why so many biotech and medical device companies are looking to Buffalo Niagara as a great region in which to grow their business. The region’s rich history of innovation was also showcased during 43North, with the premier of this fantastic new video: Next Things Now.

To earn their capital, each of these companies must establish a major operation in the Buffalo area for at least 12 months. They will all receive free incubator space, guidance from mentors related to their field and access to other exciting incentive programs (such as START-UP NY).

Let’s take a look at how the newest members of Buffalo’s life sciences community fared.

Three of the six life sciences companies impressed the panel of esteemed judges enough to earn them $500,000 each! They are: Eulysis UK, Medical Conservation Devices and Raland Therapeutics. Three more finalists took home a cool $250,000: Asana Medical, Genetisis and HemoGenyx. Additionally, Genetisis was selected as the People’s Choice Award winner, earning an additional $10,000, selected via interaction on Twitter.

Additional information on each of the winners:

eulysis

Eulysis UK
Prize: $500,000
Hometown:
Edinburgh, Scotland

Eulysis UK is a groundbreaking development company focused and committed to optimizing pharmaceutical access globally. In collaboration with the World Health Organization, Gates Foundation and other major institutions, Eulysis UK intends to commercialize the SVS technology on a global scale to provide expanded access to life-saving medicines.

medical conservation

Medical Conservation Devices
Prize: $500,000
Hometown:
Batavia, NY

Based on an exclusively licensed patent portfolio from the University of Buffalo, Medical Conservation Deviceshas developed a low-cost anesthesia machine to expand the use of anesthesia globally, including in later approvals to sedate critically ill patients and provide anesthesia to up to 8 patients at one time.

Rand pic

Raland Therapeutics
Prize: $500,000
Hometown:
Fairport, NY

Raland Therapeutics is a development-stage bio-device company focused on implantable biosensors. The company’s CytoComm™ Biosensor is a real-time monitoring system, which uses living cells to “read” a patient’s physiologic response to chemotherapy. The system also allows the personalization of dosing strategies to reduce the toxicity that so often impacts one’s quality of life.

asanaAsana Medical
Prize: $250,000
Hometown: Miami Lakes, FL 

Asana Medical seeks to improve the quality of one’s health and therefore quality of life by providing a novel treatment for debilitating digestive diseases with a patent-pending medical device that stimulates the body to heal itself. Asana Medical offers a drug-free, surgery-free twist on a proven therapy and targets the $9 billion ulcerative colitis market.

genetesisGenetesis
Prizes: $250,000, People’s Choice Award
Hometown: Mason, OH

Genetesis is a biotechnology company oriented towards optimizing drug design for treatment of heart rhythm disorders by applying novel algorithms that analyze real-time functional heart electrophysiology. Using a patent-pending system, including a non-invasive sensor array and powerful software, Genetesis is able to quantify responsiveness to drugs before they are administered.

HemoGenyxHemoGenyx
Prize: $250,000
Hometown: New York, NY

HemoGenyx is a biotechnology company developing a revolutionary new treatment for blood diseases, such as leukemia and lymphoma. The company leverages a special class of cells, which can generate cancer-free blood stem cells. HemoGenyx’s therapy can dramatically increase the efficacy of bone marrow transplants and eliminate the need for donors.

Canadian Expansion Makes Sense in Buffalo Niagara

I’ve been working with Canadian companies for several years and I love learning about their businesses and also why they are looking to expand. There are the typical reasons – the desire for a “Made in USA” label or contract requirement, currency rates, and the ability to gain access to a market ten times larger than their own. But have you ever though about border crossing costs?

Some companies are starting to look at their U.S.-based suppliers and what percentage of sales is going back into the U.S. market. Once companies start to analyze these percentages, they then start to look at border crossing costs. For example, I am currently working with a Southern Ontario company that purchases most of its raw materials from our west coast and thirty percent of its sales go back to the U.S. Another company is sourcing ninety-eight percent of its raw materials from the U.S. and has sixty percent U.S. sales.

There are several layers of border crossing costs to consider. There is the cost of physically moving the goods over the border twice. Then there is the cost of customs paperwork and fees associated with shipping and potential time delays. This becomes critical when it is a food product or other perishable items.bridge

So what is the total cost of moving these raw materials across the border to be manufactured in Canada to then be sold and shipped into the U.S.? Can these costs be reduced by opening a small manufacturing facility in the U.S.? Can the shelf life of a perishable product be maximized by making it in the U.S.? If the answer is yes, it makes sense for Canadian manufacturers to consider a facility in Buffalo Niagara where they can easily manage their U.S. facility and share key resources. All while saving time and money.

Learn more about Canadian Business expansion and view available resources on our website

By Carolyn Powell, BNE Business Development Manager

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.

If We Build It, Will Retail Come?

 

Canalside, Buffalo, NY

Canalside, Buffalo, NY

Planners and politicians agree that a vibrant downtown is a measure of a region’s success and retail activity is a critical component. While Buffalo’s central business district is in a period of rebirth, many wonder if increased retail activity will follow. Progress in other markets illustrates that a sustainable trajectory of increasing demand will appeal to retailers. This sustainability is built on common principles: increase downtown population, develop a mix of complimentary uses, attract tourists, and improve accessibility.

Housing is a primary catalyst for downtown development and a priority for local government. The 9-5 workforce cannot sustain retail and commercial activity but a significant residential population creates the necessary balance. Mayor Byron Brown is committed to residential development with his administration’s stated goal of 1,300 new downtown housing units by 2018, leveraging the recommendations of the Buffalo Building Reuse Plan (BBRP) to achieve this effort.

Building these units alone won’t create demand. Residents will be attracted to a downtown with a variety of recreational, professional, and commercial development. BNE’s downtown development map highlights the diversity of current and proposed projects.

In addition to workers and residents, a vibrant downtown will attract tourists. Complementing the existing cultural amenities, HARBORcenter, Canalside and its future attractions such as Explore & More Children’s museum will draw millions of visitors to downtown Buffalo. To meet the demand of this development, hundreds of new hotel rooms are in the works.

Lastly, a successful downtown must be accessible. As the Cars Sharing Main St. project creeps towards Canalside, a Pearl St. reconfiguration is planned and streetscape improvements are developing for primary thoroughfares such as Ellicott, Genesee, and Chippewa Streets. Buffalo’s downtown accessibility will be markedly improved.

There is no guarantee of retail progress yet, but a sign of its imminent arrival is the arrival of at least 15 new downtown restaurants recently opened or in development.

While other components such as the regulatory environment, public safety, and surrounding neighborhoods all play a vital role in the downtown equation there isn’t enough space in this post to elaborate! However, rooted in these principles, with increased retail development on the horizon, Buffalo’s downtown future will leave visitors impressed and residents proud.

by Christopher Finn, Research Manager

When it Comes to High Tech, Buffalo Manufacturing Works

While not the flashiest of Governor Cuomo’s Buffalo Billion initiatives, Buffalo Manufacturing Works has the potential to be one of the most effectual of them all. Originally dubbed the Buffalo Niagara Advanced Manufacturing Institute, Buffalo Manufacturing Works will soon become a pillar of the region’s manufacturing sector, providing technology solutions to companies across the industry through world-class engineering support, research and design, training and strategic services. Over the next five years, $45 million will be invested in facilities, equipment and engineering staff creating a state-of-the-art institution for the benefit of WNY manufacturers.

Perhaps my favorite aspect of Buffalo Manufacturing Works is that it creates a major new asset for existing WNY manufacturers while simultaneously creating an incentive for BNE to market to potential attraction targets. In an era where companies across the board are cutting back on research and development budget lines, the opportunity to leverage this great asset will be a significant draw for growing manufacturing firms. Few other locations provide companies with such an advantage.

Resulting from several in-depth focus groups and research, three primary technology areas will dominate Buffalo Manufacturing Works: flexible automation, materials and testing, and processing and fabrication. Columbus, Ohio-based EWI, North America’s leading engineering and technology organization, will operate the institute. The member-driven not-for-profit was selected to operate the Buffalo initiative based on its 30 years of success in central Ohio. Three additional key local partners are involved: the University at Buffalo providing access to early-stage fundamental research and academic facilities; Insyte Consulting assisting with improvements to process and operational productivity; and the World Trade Center Buffalo Niagara helping companies identify new markets and export opportunities.

As manufacturing shifts ever more towards highly technical and advanced practices, this investment will prove integral in continuing the Buffalo Niagara region’s great legacy as a nucleus of manufacturing innovation.

Click here to read more Buffalo Manufacturing Works from the Buffalo News.

by Alan Rosenhoch, Business Development Manager