Wooing is fine, but will they come?

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Site selectors evaluate prospects in the Greater Hartford area
By Anusha Shrivastava, Harford Business Journal
Published on August 29, 2005

Urging companies to move to the Greater Hartford area is no easy task.

First, there are preconceived notions about the region and impressions from the hit it took during the last economic downturn. There may be a lack of information about the choices businesses have, and there are other cities and states standing on line to woo companies.

“Economic development is very competitive today,” says Susan Arledge, president of Dallas, Tex.-based Arledge/Partners Real Estate Group Inc. “Every region is eager to tell their story. You have to create a competitive advantage and provide data — with interpretation — if you want to stay in the game.”

Arledge was one of a dozen site selectors invited by the Metro Hartford Alliance last week to hear just such a story: the tale of a region making a concerted effort to rejuvenate itself by building hotels and condominiums, restaurants and roads, office spaces and even a convention center.

“We have to keep our name on their radar screen,” says Nelson “Oz” Griebel, president and CEO of the Metro Hartford Alliance. “We know this is very competitive.”

“You need to create a heart for the city,” says Peter Chin, head of global real estate and facilities for XL Global Services, which already has an office in downtown Hartford. “What are you supposed to do after the convention is over? That’s the reason people go to a mountain retreat or to Las Vegas, there’s something to do after the meetings are over. I think it’ll happen [in Hartford], but it will take time.”

What is good about the area though, Chin says, is that people who live here want to continue doing so. “It’s a great labor market and the real estate costs are still very low.”
His peer, Abbye Suskin, regional real estate manager for American International Realty Corp., echoed the thought, saying Hartford is “well known” for its insurance sector. Despite the mergers and the moving away of some companies, Suskin says insurance companies know they will find the right people to hire here. “In some ways, it helps because more people are looking for insurance jobs now that the mergers have occurred.”

Like others in the group, Dennis Donovan, senior managing director for New Jersey-based Wadley-Donovan-Gutshaw Consulting, has some thoughts he would like potential clients to ponder over.

Listing the pluses and minuses of moving a business to the state, he says: “The dynamics that impress me are the logistical advantages of being close to New York and Boston, the breadth of the labor pool here and the relatively cheap real estate.”

Among the negatives, he says, is that the state’s business climate is unattractive. “You have to change the high tax situation, the high legal liability and worker’s compensation.”
The state also offers few competitive incentives for recruiting businesses. “There are very few exemptions compared to, say New York, where you can get 10-year tax holidays, or Oklahoma, where you can get cash for creating jobs.”

His suggestion, then, is to create programs where companies can get cash for adding jobs each quarter so they stay in the area, and not relocate once their grant money dries up and they get a better deal elsewhere. “When companies get real incentives for creating jobs, there is a win-win situation for everyone.”

His specific concern about the Hartford area, though, is the fact that 16 percent of adults in the Greater Hartford area do not have high school degrees, which means “they will be a burden on the rest of the labor pool.”

Placing Hartford among what they call second and third tier cities, like Providence, R.I., and Albany and Buffalo, N.Y., the selectors say they generally visit three to four cities each year, before making recommendations to their clients or even their own companies.
“Word is getting out that things are changing in Hartford,” says James Scanell, vice president of administrative services for St. Paul Travelers.