Updated: Speculative Industrial Manufacturing Buildings–Bad Gambles with Taxpayer Money

Posted on January 28, 2018

Steve Mensing, Editor

♦ A popular game played in economically struggling and desperate parts of our Country is squandering taxpayer money on speculative industrial buildings for manufacturing. We’re not talking about “flex” buildings for distribution centers and warehousing where interior walls can be adjusted for floor space requirements–-they are less of a gamble unless your area has a large inventory of empty buildings suitable for distribution and warehousing. Here we are focusing solely on large and expensive speculative industrial buildings for manufacturing built on the taxpayers dime. Such “build it and they come” constructions are well known risks for taxpayer dollars. These extreme gambles, if they are even entered into, are best only funded by private investment. If private investment is showing no interest in a project that’s clear indication that a project is not worthwhile.

I’m told that Rowan County once was inveigled into such a taxpayer backed industrial spec venture back in the early 2000’s and the “build it and they didn’t come” site sat idly for years before it was finally peddled off at a great loss of taxpayer investment. In the dark history of “build it and they will come” spec industrial manufacturing buildings are among the most common and expensive busts.

Constructing large and expensive speculative industrial buildings for manufacturing is largely a high risk gamble that seldom pays off save for the architects and construction outfits who profit from the construction and those who might be in line for money under the radar. Frequently kickbacks and bribes are the major motivation for high-risk gambles on “build it and they will come” projects.

But why are speculative industrial buildings for manufacturing, built on the taxpayer’s dime, high-risk? It’s easy enough to see.

• Each manufacturing company has their own unique building specifications that a one-sized fits all building will seldom if ever match. For example:

* Floors might be required to bare a specified weight. A very important consideration.

* A building’s shape and length might have to adhere to assembly line anomalies like curves, forks, rises in elevation.

* Ceilings must be height specific.

* Roofs may have to support weighty cooling units.

* Support beams require a certain load baring ability.

* Portals must be large enough for tall and wide machinery.

* Ramps and truck entrances/exits need to be a certain size and width.

* Are the areas statistics inviting to industrial manufacturing companies? Companies, looking to transfer staff and their families, take very seriously an area’s crime stats, public school performance, and poverty statistics. Salisbury and some parts of Rowan County would get short-shrift based on statistics alone. Many other areas are far more livable than Salisbury and Rowan County. Can our workforce pass a urine analysis? That’s a biggie considering the County’s major challenges with hard drugs like heroin, meth, crack, and assorted opioid painkillers.

* How about the area workforce? Are they educated and specifically trained to meet a prospective manufacturer’s criteria?

* How about the economy’s fluctuations and its impact on an industry? The need for a company’s expansion may vanish overnight.

* Know that other areas of the country, with less challenges, have plenty of incentives to throw at prospective companies.

* And a very important consideration, yet a seldom discussed one. If a manufacturer ever does buy this spec adventure, will it even bring jobs to the county? There’s quite a few manufacturers today who employ high-tech automated machines not requiring workers save for one or two overseers per shift. Robots are taking the slots formerly manned by human beings. They have advantages in efficiency, speed, lifting ability and they are don’t do: “No call–no show.” One day we’ll see billboards on N.C. highways saying: “Hire a Bot”.

Constructing speculative industrial buildings for manufacturing are a proven high-risk gamble. The landscape across the United States is littered with “build it and they will come” vacant buildings and empty job promises never fulfilled. Oh you will see “experts” scrambling out of the woodwork pimping these spec industrial shells. But realize that in a court of law the prosecutors will have one set of psychiatric witnesses testifying one way and the defense will have psychiatric witnesses testifying in opposition. A taxpayer and someone sincerely interested in seeing true economic growth in a county needs to look at the facts of industrial spec buildings and their immense downside. If someone wants to throw private dollars at these gambles–fine and dandy. But if you don’t see private money coming forward that’s a pretty good litmus that this latest “build it and they come” project is rancid pork.

While it would make good sense to prep land for industrial use and make sure zoning requirements are in place so fewer obstacles for an industry stand in the way–speculative industrial buildings built with little thought about a specific company’s needs are snake-eyed dice rolls.

The Dark Side of Build It and They will Come:


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