CHARLOTTE’S ALDERSGATE FACES AN UNCERTAIN FUTURE THE SAVVINESS OF FIRST CITIZENS | BAGPIPES IN ZEBULON | CURI’S GROWTH STRATEGY
FEBRUARY 2024
TALENT SCOUT
Thadd Jones, a veteran of Lowe’s and Amazon, leads his own fast-growing search firm. He’s part of our Dynamic Diversity feature.
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FEBRUARY 2024
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UP FRONT
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POINT TAKEN
A helpful network is improving the journey from military service to the private sector.
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NC TREND
Why Roddy MacLellan makes bagpipes in Zebulon; Dealmaker Jason Sandner doubles Curi’s size; As large factories emerge, where are folks going to live? Sonja Nichols’ revives a popular Queen City shopping tradition.
78 PROJECT PLANS Mountainous Mitchell County exemplifies how the state’s rural counties persist in a challenging pursuit for growth.
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DYNAMIC DIVERSITY 28 ROUND TABLE: ECONOMIC FORECAST Our annual look-ahead found panelists agreeing that slower growth is likely in 2024, but the state should avoid a recession.
Business North Carolina celebrates people from various racial and ethnic backgrounds from across the state, spanning a wide range of occupations. BY KEVIN ELLIS, DAVID MILDENBERG AND CHRIS ROUSH
58 POWERING NORTH CAROLINA As North Carolina marches toward a clean energy future, local electric cooperatives are at the forefront of innovation.
COVE R PH OT O C R E D I T : ST E VE N M A S T
66 COMMUNITY CLOSE UP: MOORE COUNTY The state’s most famous golf county is also known for its charming small towns and a vibrant economy that is proving remarkably resilient.
SILICON SAVVY
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SENIOR SLIDE
First Citizens Bank’s bold conquest raised the stakes and profile of the bank controlled by the Holding family.
Consistent losses and failed expansions create an uncertain future for Charlotte’s Aldersgate retirement community.
BY MIKE MACMILLAN
BY SHANNON CUTHRELL
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February 2024, Vol. 44, No. 2 (ISSN 0279-4276). Business North Carolina is published monthly by Business North Carolina at 1230 West Morehead Street, Suite 308, Charlotte, NC 28208. Phone: 704-523-6987. All contents copyright © by Old North State Magazines LLC. Subscription rate: 1 year, $30. For change of address, send mailing label and allow six to eight weeks. Periodicals postage paid at Charlotte, NC, and additional offices. POSTMASTER: Send address changes to Business North Carolina, 1230 West Morehead Street, Suite 308, Charlotte, NC 28208 or email circulation@businessnc.com.
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UPFRONT
Chris Roush
DIGITAL STRATEGY
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hen I started at Business North Carolina this past summer, my mandate was to develop a digital strategy for the magazine that expanded our coverage and helped our readers. Here’s what we’ve done and where we’re headed: The first thing we did was survey our readers, particularly the 17,000-plus subscribers to our popular “Daily Digest” newsletter, and those tuned into our “N.C. Tribune” newsletter, which covers political-related news of interest to business leaders. We found a committed audience that loved what we were doing. Specifically, they appreciated how we covered the entire state and not just one region. I also surveyed what other statewide business news publications were doing and talked with a few of them. In particular, Vickie Chachere of Florida Trend was helpful in providing insight into the multiple weekly newsletters that it creates. We also examined what publications were charging, as we did not want to lose the large clientele that we’d developed with “Daily Digest.” The first step was to make some changes to our website. Previously, our businessnc.com website featured content from the latest issue of the print magazine. Unless you scrolled down, you’d miss our daily content. When returning to the website anytime during the next month, you’d see the same content, not breaking business news. This fall, we put the daily news content at the top of the page, giving readers new stories almost every time they visit. That change has resulted in 50% to 60% monthly increases in page views. We’re also doing more with that daily news content on our social media, particularly Twitter/X and LinkedIn, where our readers are most likely found. If you’re not following Business North Carolina at those outlets, I’d highly recommend you do so for alerts about breaking business news. The next phase of the strategy is now rolling out with three newsletters that address
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the need for news and information in areas that we believe are underserved. In mid-January, we introduced “NC Military Report,” a weekly paid newsletter that covers the military industry in the state. The military's role in the North Carolina economy is often overlooked. But according to the N.C. Department of Commerce, the military supports roughly 11% of the state’s employment. That's 653,000 jobs in North Carolina, more than $49 billion in state personal income, and nearly $80 billion in gross state product. Next up, in February, will be another paid newsletter, “Daily Digest Extra,” delivered twice a week in the afternoon with breaking business news. We didn’t want to mess with the success of “Daily Digest” by converting that to a paid model, so “Extra” will give those who subscribe immediate insight into breaking business news. And later this year will come “Markets Insider,” a paid newsletter covering investing in public and private companies around the state. It will be news and analysis to those who want coverage of the companies, and who need information to make investment decisions. We believe these three newsletters will provide a service that will aid North Carolina’s business and economic leaders, and provide content in areas that other media aren’t covering extensively. You can subscribe to these newsletters by clicking on the Newsletters tab at the top of our website. Please let us know how we’re doing. Our job is to give you the best news and information you need about North Carolina businesses and its economy. Contact Chris Roush at croush@businessnc.com.
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In the 2024 Class of Legal Elite, incorrect spellings or locations were listed with these attorneys: Bankruptcy: Richard “Trey” Rayburn, McGuireWoods, Charlotte. Business: Nathan M. Hull, Hull & Chandler, Charlotte; Christopher Kouri, Maynard Nexsen, Charlotte. Construction: Eric H. Biesecker, Maynard Nexsen, Greensboro. Criminal: Daniel D. Adams, Brooks Pierce, Raleigh. Employment: Bridget A. Blinn-Spears, Maynard Nexsen, Raleigh; Edward S. Schenk III, Williams Mullen, Raleigh. Family: Bradley C. “Brad” Jones, Parker Bryan Family Law, Morehead City; Joshua L. Finney, Sodoma Law, Charlotte. Corporate Counsel: Kathryn Twiddy, AutoCruitment, Raleigh. Litigation: Sammy Naji, Triangle Legal, Cary. Tax and Estate Planning: Robert D. Lyerly Jr., Maynard Nexsen, Charlotte. Real Estate: Robert May Jr., Banzet, Thompson, Styers & May, Warrenton; Hank Harrawood, Knipp Law Office, Belmont; David W. Murray, Murray Law Firm, Charlotte; Tonya B. Powell, Maynard Nexsen, Raleigh; Scott Andrew Schaff, Womble, Bond Dickinson, Winston-Salem.
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POINTTAKEN
Dan Barkin
TRANSITION TIME A helpful network is improving the journey from military service to the private sector.
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n November, I went to Fayetteville to the offices of NCWorks, the state agency that helps folks find jobs. The event was a roundtable. Army veterans talked about making the transition from the military to civilian careers. Moderating was Gov. Roy Cooper, who was joined by Commerce Secretary Machelle Baker Sanders and retired Marine Lt. Gen. Walter Gaskin, secretary of military and veterans affairs. The topic was what the state can do to help veterans and get them to stay here. This year, an estimated 21,300 service members will leave our bases – Fort Liberty, Camp Lejeune, Seymour Johnson Air Force Base and the Coast Guard – and become civilians. At a time when employers struggle to find workers and colleges struggle with enrollments, this is a prime group to recruit. We already are home to nearly 700,000 veterans and their families, the ninth-largest veteran population in the U.S., and nearly 200,000 are under 50. The job of folks who run transition assistance programs at the bases is to get the service members prepared for wherever they go, whether it is North Carolina or Iowa. ANXIETY AND STRESS Jeff Craver, director of the Military & Family Readiness Center at Seymour Johnson, has been on both sides of the process. He retired as a command chief master sergeant after 30 years. “Everyone at some point is going to part ways with one of the service components. And you’re only going to do it once. And nobody knows how to do it. They all know how to raise their
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Jeff Craver
right hand and enlist. But when it comes to separating and moving forward, then that’s where there’s a lot of fear, and an awful lot of uncertainty, and an awful lot of anxiety, and an awful lot of stress. And that’s where our team kind of comes in and helps them navigate through that journey.” Bill McMillan, transition services manager at Fort Liberty, has worked with service members for more than 30 years. “Prior to 2011,” says McMillan, “we were mostly just basically teaching them how to do resume writing, how to do job search, helping them with the VA claims where possible.” That changed around a decade ago. One reason was that the military was paying a lot in veterans unemployment benefits. In 2011, when the economy was tanking, the Army paid out more than $500 million. Congress pushed the Department of Defense to improve transition programs. The process now begins a year before separation and requires one-onone counseling. There are sessions on benefits, educational opportunities, entrepreneurship, financial planning and employment in civilian life. There’s a “crosswalk” session to identify jobs that correspond with military jobs. Last year, the Army paid out $21 million for unemployment benefits. But there’s more going on. McMillan described a career skills program that lets soldiers nearing separation work for companies while drawing military pay. An agreement with Pfizer’s plant in Sanford enables
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some veterans to start at jobs paying $80,000 or more annually, after internships of two or three months, he says. BMW has a facility at Fort Liberty that trains soldiers on their cars. “As soon as they graduate the course and clear the installation, they go straight to work at a BMW dealership,” says McMillan. “Service members will go where the jobs are. If a state does not really market that they have opportunities, then there’s not a reason, necessarily, for a service member to stay there.” The military has job fairs on installations. There’s no shortage of for-profit and nonprofit organizations trying to connect veterans with jobs. But practically speaking, given their Monday to Friday work schedules, active-duty service members are challenged to get a full picture of job opportunities. On weekends, many businesses are closed. “We try to get out and find out what these companies have to offer,” says McMillan. “And then we try to bring the company into the installation.” SKILLBRIDGE One effective program is the DOD’s SkillBridge, a military-wide program that lets transitioning service members work their last six months for an employer, while receiving military pay. So far around 50,000 service members have gone through it, with 3,300 employers. There’s no guarantee of an offer; it is a low-risk deal on both sides. It has been popular at Camp Lejeune, where nearly 200 service members a month are approved, says Sherry Anthony, who runs the program there. “It’s blowing up.” The program got so popular that the Pentagon briefly stopped accepting new employers last summer. Tyler Klemas, a Duke Energy lead operational excellence specialist, praises SkillBridge. Klemas served as an infantryman in the Marine Corps, in Afghanistan and Iraq. “We encourage people to email us once they get to eight months to a year from getting out. The last year or so, I think we’ve brought in four or five people via SkillBridge and saw all of them all the way through, and ultimately hired them.” He urges employers to send veterans to military and veteran job fairs. “Send me, the guy with no degree, covered in tattoos. Because at the end of the day, they’re going to gravitate toward people who know the lingo, who know the talk, who know the life.”
Tyler Klemas
Joanna DeMott
In the last few months, I talked with veterans, companies and transition personnel to learn more about the journey. Tarsha Burroughs, a training lead at Novo Nordisk in Clayton, was in an Army chemical decontamination unit in Baghdad when she was wounded in a mortar attack. She got out in 2007. Today, she’s trying to encourage more veterans to consider Novo, where 7% of its North Carolina employees are veterans. Joanna DeMott is CEO of Green Zone Corporate Training, which helps companies recruit veterans and their spouses. The wife of a retired Marine, DeMott has worked for the Marines as a civilian program manager and for UNC Wilmington in military affairs. The service member can’t just shed a military identity in one day, she notes. “It’s not like you have your last day of service and then you’re like, ‘Yep, I’m a veteran. I want to take advantage of all these benefits,” she says. “That’s why there’s also sometimes that gap. That shift in identity doesn’t always happen right away. We shouldn’t be reliant upon the service member to own the culture shift on their own. We have to meet them halfway.” THE FOOD TRUCK The November discussion with the governor included veteran Justin Cloud. In a later interview, he mentioned that he was rolling out his new food truck. In fact, he was a few blocks away from Fort Liberty, Justin Cloud where he was going to cook wings, in front of the a military surplus store. Cloud got out of the service in 2004, and discovered a passion for cooking, and was doing that on the West Coast but came back to Fayetteville and family. He got connected with a veterans employment representative at NCWorks. That rep, Tremayne Gilchrist, “pretty much was either calling or emailing me every day, or every other day, to let me know some things that were available,” says Cloud. “They gave me enthusiasm.” I was driving to a job fair in nearby Hope Mills sponsored by NC4ME – one of the state’s leading veterans employment groups. I stopped by Cloud’s truck, because this was an example of what everyone – the state government, hundreds of nonprofits, and the military – wants to happen: an entrepreneurial veteran staying here and starting up something. ■ Veteran journalist Dan Barkin writes the NC Military Report newsletter for Business NC. Originally from Newton, Massachusetts, Dan moved to the South for college before settling in North Carolina in 1996. He can be reached at dbarkin53@gmail.com.
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PROTECTING YOUR FAMILY BUSINESS FOR WHEN MARRIAGES END By Zac Lamb and Merrill Jones
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ove may be eternal, but all relationships on this earth are guaranteed to end at some point. In fact, we know with certainty that every marriage is going to end in one of two ways, either by death or divorce. For business owners, planning for these eventualities can prevent the end of a marriage from also triggering an end to their business. MARRIAGES THAT END DUE TO DEATH The hope of most newlyweds is that they will breathe their final breath while they are still in love with and married to their spouse, after spending a long, happy life together. Even those individuals who are fortunate enough to experience this rosy outcome would be well-served by putting in place an estate plan to dictate the settling of their affairs after their death. An estate plan typically consists of a Last Will, though various trusts might be incorporated into the plan if appropriate. An estate plan contains instructions about how assets are to be handled (i.e., who gets what) and also designates one or more persons who will be responsible for carrying out the instructions (i.e., an executor or trustee). For a business owner, a key decision that must be made is who will receive ownership interests in the business. Potential recipients could include the owner's surviving spouse, children or grandchildren, or long-time employees. Generally, a person is free to structure their estate plan however they want. Nevertheless, if the person is survived by a spouse and does not leave their spouse a large enough 8
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share of their estate, then under North Carolina law the surviving spouse can file a claim in the estate to receive that minimum share. The size of the share varies based on the length of the marriage. It starts at 15% and grows to 50% after 15 years of marriage. If a business owner wants to leave ownership interests to someone other than their surviving spouse, certain planning strategies can be implemented to ensure that the plan is not disrupted due to the surviving spouse's right to claim a share of the estate. Commonly, a person's interests in their business represents the bulk of the value of their estate. If the owner wants to benefit several individuals in their estate plan but does not want to divide the business among them, then life insurance often can be incorporated in the plan so that some beneficiaries receive cash while the business interests go to one or more other beneficiaries. If interests in the business will be given to multiple beneficiaries, then the owner might choose to condition the gifts on the beneficiaries entering into a shareholders' agreement with terms that the owner establishes as a part of their estate plan. This allows the owner to set parameters for how the company will be controlled and how the beneficiaries might transfer their ownership interests in the future. Setting those rules in the estate plan avoids the beneficiaries having to negotiate those terms at what may be an emotional and stressful time due to the owner's death. SPONSORED SECTION
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the value of the interests will not be taken into account when dividing other assets. Buy-sell agreements also can help protect the business from a divorce. For example, all of a business's owners might agree that if any owner divorces, then the business would redeem that owner's interest for a set price, so that the sales proceeds would be subject to the divorce proceeding but not an actual ownership interest in the business. CONCLUSION All marriages end. If a family business is involved, the end of a marriage has the potential to derail the business. However, owners who put the time and effort into considering how things might play out in the marriages of themselves and their business partners and who put agreements in place to address those outcomes stand a much better chance of seeing their business survive. Ultimately, there is no one-size-fits-all estate plan. Every person's situation is unique. A thoughtful estate plan should consider the owner's goals, the relationships of the individuals involved, and the nature of the business and its operations. ■
MARRIAGES THAT END DUE TO DIVORCE Not all marriages last the lifetime of the couple. Some marriages end because the couple decides to divorce. When spouses divorce in North Carolina, if the parties do not otherwise agree, the courts will determine how the couple's assets are divided in a process referred to as equitable distribution. The court first classifies assets as either separate property or marital property. Separate property includes assets that one spouse owned before the marriage along with gifts or inheritances that a spouse received during the marriage. Marital property includes all of the property acquired during the marriage, other than gifts or inheritances. Generally, each spouse is entitled to keep their separate property, and the marital property is divided starting with the presumption that each spouse is entitled to half of it. Equitable distribution proceedings often are acrimonious and can result in protracted battles over how property is divided. When family businesses are involved, the business may find itself being ordered by the court to turn over records or financial data or to refrain from transferring assets. Certain agreements can help protect a business from the divorce of its owners. Pre-marital or post-marital agreements can establish each spouse's rights to ownership interests in the event of a divorce. For instance, the couple might agree that the interests will remain with the spouse who owns them and
Zac Lamb North Carolina Board Certified Specialist in Estate Planning and Probate Law zflamb@wardandsmith.com
Merrill Jones Business Attorney mgj@wardandsmith.com
Read additional articles in our new series "The Intersection of Love and the Law," throughout February at
wardandsmith.com This article is not intended to give, and should not be relied upon for, legal advice in any particular circumstance or fact situation. No action should be taken in reliance upon the information contained in this article without obtaining the advice of an attorney. F E B R U A R Y
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NCTREND ››› Entrepreneurship
PIPE DREAMS
A veteran Scottish bagpipe maker thrives in Zebulon. By Mike MacMillan
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quick Google search for bagpipe jokes turns up a perhaps not surprisingly large cache of material. This one, for example:
Fair enough. Bagpipes are not for everyone. But they are for Roddy MacLellan, founder of MacLellan Bagpipes, one of perhaps only three bagpipe makers in the United States, and a relative handful worldwide. Most are based in Scotland. MacLellan is based in Zebulon in eastern Wake County. In October, the NC Chamber selected the business as one of the “cool things” made in the state. All joking aside, the bagpipe industry is alive and well. “After COVID there was a bit of a lull (in sales) because there weren’t as many parades, but it’s picking up now,” says MacLellan, noting that the bagpipe is among the 10 most popular instruments to play. MacLellan has a one-year backlog for its custom-built instruments that range in price from $2,000 for a basic model to $10,000 for pipes with custom silver work and other flourishes. The popularity of this nearly 1,000-year-old instrument was on full view at the 2023 World Pipe Band Championship held in Glasgow, Scotland, which featured 190 bands from 15 countries, up from 146 bands the year before, according to a story in the Piping Press. Those sending bands included Australia, Canada, the U.S., 10
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Bagpipes date back nearly 1,000 years.
PHOTOS COURTESY OF MACLELLAN BAGPIPES
Question: What’s the definition of a gentleman? Answer: Someone who knows how to play the bagpipes but doesn’t.
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Israel, Malaysia and Zimbabwe. There is even an International Bagpipe Day – March 10, with events held around the world to mark the occasion.
PHOTOS COURTESY OF MACLELLAN BAGPIPES
A ROUNDABOUT JOURNEY As seems fitting, MacLellan came to bagpipe making in something of a roundabout way. Born in Glasgow, he trained as a silversmith at an art school there before immigrating to the U.S. in 1980. He settled in Montclair, New Jersey, plying his trade for customers that included Tiffany’s and the Sotheby’s art auction house. He then moved into fashion photography for a time. In 1993, MacLellan joined a pipe band in nearby New York City as a “way to get back to my heritage,” he says. Needing an instrument, he built his own set of bagpipes and found that the one he made was as “good as anything they were importing.” Soon enough, he was building pipes for others, and doing the work on a full-time basis. A series of moves down the East Coast eventually landed MacLellan in Monroe around 2010, where he built and sold bagpipes for more than a decade. In 2022, he relocated to Zebulon’s main drag, North Arendell Avenue, where he has a storefront showroom, a shop in the back, and a frisky boxer named Isla who greets visitors at the door. The impetus for the intrastate move came in part through his work with Raleigh’s Wake & District, one of the biggest pipe bands on the East Coast with about 80 kilted bagpipers and drummers. MacLellan is the group’s featured supplier of pipes.
“Roddy is probably one of the top three bagpipe makers in the world,” says Joe Brady, a former Chicago policeman who founded Wake & District in 2006. “We’re incredibly lucky to have him here.” MacLellan works mostly alone, cranking out about six bagpipes per month. “I’ve kept it small because I like to be hands-on,” he says. On the shelves of his shop are the raw materials of bagpipe construction, including a supply of African black wood, prized for its denseness and its ability to resist moisture. Fourteen pieces of this wood are meticulously turned and drilled by hand to make the body of a bagpipe. “I had the benefit of learning hand skills in Scotland, but not many people do that anymore,” says MacLellan. “Most people work with computers. They don’t make things. We’re losing those skills.” Along with Wake & District, MacLellan is attempting to secure his legacy by setting up an apprenticeship program, but it hasn’t been easy. Making a bagpipe requires both meticulous craftsmanship and dedication to the instrument. “No one is going to get rich making bagpipes,” says Brady. “It’s more a labor of love.” To somewhat paraphrase Thomas Wolfe, a destiny that leads a Scotsman from Glasgow to New Jersey and on to a bagpipe shop in Zebulon, population 10,000, may seem a strange one. But as long as the 67-year-old MacLellan remains at work there, North Carolina will stand at the epicenter of the craft. And that’s cool. ■
Scotland native Roddy MacLellan started making bagpipes in 1993. He completes about six a month, supplying Raleigh’s Wake & District band, among others.
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NCTREND ››› Expansion
CURIOUS ABOUT GROWTH
Raleigh’s Curi doubles in size with insurance and wealth management expansions.
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s a second baseman and center fielder at Towson University in Maryland, Curi CEO Jason Sandner batted over .300 for three consecutive seasons and helped lead the Tigers to the most wins — 33 in 1999 — in program history. He’s now seeking similar success and consistency for Raleigh-based Curi, which a decade ago was singularly focused on medical malpractice insurance. The former Medical Mutual Insurance of North Carolina, founded in 1975, rebranded itself in 2019, choosing a name derived from “curious.” Curi now has three core businesses: wealth management, a financial advisory firm and insurance. It has made acquisitions in each field in the past three years as part of a national expansion. More growth is coming, Sandner adds. “We need to meet our clients where they are,” he says, who joined the company in 2011. “Our growth is entirely focused on being where our clients are.” N.C. physicians started the business when other insurers stopped offering malpractice coverage in North Carolina. The bulk of its revenue came from North Carolina, with smaller shares in Virginia and Georgia. When N.C. Mutual saw independent doctor practices merging with each other or being acquired by hospitals, it realized it needed to change as well. “It was clear to us that if we wanted to work with more practices, that geographic expansion was going to be critical to our success,” says Sandner, who batted .296 overall with 12
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96 RBIs during four years at Towson. “We also had a vision at that point to do more for those practices.” After a decade working in the Raleigh office of the Johnson Lambert & Co. accounting firm, Sandner started as the company’s vice president of finance, then was promoted to chief financial officer in 2014. He later became chief operating officer and moved to the top spot in 2021, succeeding Dale Jenkins, who had led the business for 25 years. Medical Mutual restructured in 2014 into a holding company, which is owned by its 26,000 members. It launched its money management business in 2019 and the advisory operation two years later. Last October, the company doubled in size by buying Minnesota-based Constellation, which includes Midwest Medical Insurance, Arkansas Mutual, the Utah Medical Insurance Association and the Michigan Professional Insurance Exchange. The two insurance operations were similar in size: Constellation had premium revenue of $185.6 million in 2022, compared with $175 million at Curi. The combined business sells coverage to more than 50,000 doctors and is led by former Constellation CEO Ryan Crawford, who is based in Minneapolis. Curi is “working diligently” to integrate the companies, and will soon introduce new products. “We’re really looking forward to this next phase of the process,” Sandner says. “We’re excited and highly optimistic about our collective future.”
PHOTOS COURTESY OF CURI
By Chris Roush
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PHOTOS COURTESY OF CURI
As often happens amid acquisitions, insurance rating agency A.M. Best placed Curi’s financial strength rating of A (excellent) under review so it could assess the deal’s impact. A.M. Best hasn’t made a further announcement as of midJanuary, a spokesman said. On the asset management side, the company had long taken premiums from its insurance business and invested that money into stocks, bonds and more recently, commercial real estate. “As we started to share those results with our members, they came to us and asked if there was an opportunity to invest,” says Sandner. After offering investment services to its members for many years, Curi Capital launched in 2019 to manage assets for others. In 2022, it acquired KDI Capital Partners, an investment firm that had been part of Investors Management, the parent of Golden Corral. Later that year, it bought Park Ridge Asset Management’s investment advisory business. Both KDI and Park Ridge are based in Raleigh. Curi’s biggest expansion in money management came in January, when it gained a majority stake in Chicago-based RMB Capital, which has $9.6 billion in assets under management and 156 employees. Terms were not disclosed in the deal, which boosted Curi Capital’s business nearly ten-fold. Curi Capital CEO Dimitri Eliopoulos had worked at RMB Capital before joining the Raleigh company in 2020. RMB Capital CEO Dick Burridge remains executive chairman and co-chief investment officer. The RMB deal adds offices in cities such as Milwaukee, Minneapolis, Washington D.C., and Jackson Hole, Wyoming. “It is going to open a lot of growth opportunities in the West and Midwest,” Sandner says. Further diversification occurred in 2021 when Curi bought Arrowlytics, a Charlotte healthcare analytics and advisory company, followed a year later with a partnership with Gastrlogix, a Philadelphia-area group purchasing company for gastroenterologists. Curi’s clients had been asking for guidance about topics ranging from how to run their practices to financial modeling, with the COVID-19 pandemic expanding those calls exponentially.
Sandner presenting at the Curi 2023 holiday luncheon.
“You can imagine the business challenges that arose for a physician practice,” Sandner says. “These practices didn’t have the resources internally.” The sharp reversal in interest rates in 2021-22, which deflated the value of fixed-income investments, proved costly for many financial institutions, including medical malpractice insurers. Curi had a net loss of $74 million in 2022. Constellation reported a $117.4 million loss as it marked down its investment portfolio by $134 million. Curi declined to disclose its 2023 performance, though improved stock and bond markets last year “should help paint a different picture,” Sandner says. Curi’s balance sheet remains solid with more than $2.3 billion of assets and net equity of $900 million, he adds. Curi, he says, will live up to its new name. “We describe ourselves as a curious, innovative company looking to solve challenges for our clients.” ■
CURI’S SENIOR LEADERSHIP
CURI’S NET INCOME
Jason Sandner, chief executive officer
2017
$32 million
Rob Christner, chief administrative officer
2018
$35 million
Ben Remke, chief financial officer
2019
$41 million
Steve DeBiasi, CEO, Curi Advisory
2020
$10 million
Dimitri Eliopoulos, CEO, Curi Capital
2021
$101 million
Ryan Crawford, CEO, Curi Insurance
2022
($74 million)
Jason Sandner
Source: company reports
F E B R U A R Y
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NCTREND ››› Housing
NO ROOM
Chronic housing shortages could threaten the state’s growth.
By Cooper Metts
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estimates. Henderson County is estimated to have a shortage of about 1,650 rental units and 311 for-sale housing units through 2025, according to a study conducted by Bowen National Research. The study estimates that Buncombe will be 5,439 rental units and 1,329 for-sale housing units short during the same period. Chatham County is attractive to people working in Raleigh, Durham and Chapel Hill, as well as potential workers for the Wolfspeed and VinFast plants under construction in the area. The county’s population has increased by 21% over the past five years, while the percentage of vacant housing units has declined by 51%. “We’re really at a [housing] shortage,” says Chatham County Planning Board member Eric Andrews. “There’s not enough [housing] projects in the funnel today, so we know we’re going to have a problem two to five years from now.” IT’S NOT JUST HOMES New homes require more utilities, which is another factor in the supply shortage. Chatham County doesn’t have wastewater capacity for building new homes in its two largest towns, Pittsboro and Siler City. In response, Pittsboro agreed to merge its water and wastewater utility systems with Sanford in neighboring Lee County. The move will increase Pittsboro’s water capacity by 150% and wastewater capacity by 566%, according to the town’s website. It takes time to install infrastructure, however. Sanford is scheduled to take over Pittsboro’s water and wastewater assets
PHOTOS COURTESY OF CURI
A
s North Carolina’s bedroom communities see steady growth from businesses coming to the state, inadequate housing supplies for workers in these regions may stymie expansion plans. Optimists respond that the markets always present opportunities. The state’s most anticipated housing effort might be Disney’s plan for the Asteria residential community, in Pittsboro in Chatham County. Asteria expects to offer about 4,000 residential units over 1,500 acres, with sales anticipated to start in 2027. Demand for housing can change in the short run, but supply typically only adjusts in the long run due to hurdles such as zoning constraints and building considerations, says Roberto Quercia, a UNC Chapel Hill professor who specializes in housing and community development. And a housing supply shortage dates back 10 years or more in many parts of the state, industry experts say. This poses serious implications for economic development, says Emil Malizia, also a UNC real estate development professor. Hendersonville is “looking all over the place for ideas because everybody’s kind of dealing with the same thing,” says Lew Holloway, the city’s community development director. He notes that Asheville’s 28% increase in population over five years has increased demand for housing in neighboring Henderson County. Of the 4,294 people who moved to the county from within North Carolina over the past five years, 47% came from adjacent Buncombe County, according to Census Bureau C A R O L I N A
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in July, but the connection line won’t be completed until late 2025. Finishing upgrades to the water transmission line and the Sanford Water Treatment Plant aren’t scheduled to be finished until early 2027. Pittsboro’s water merger with Sanford syncs well with Vietnamese automaker VinFast’s construction timeline for its local plant, which officials have said could create 7,500 jobs. Nearby, Siler City has agreed to expand its wastewater treatment plant this year with Sanford’s help, says Chatham County Manager Dan LaMontagne. But that plan puts Siler City behind schedule for Wolfspeed, which anticipates creating 1,800 jobs at its semiconductor factory. In nearby Randolph County, Toyota is scheduled to manufacture batteries in 2025 and create more than 5,100 jobs. Elsewhere, Kannapolis has become a popular option for people with jobs in Charlotte, but it also faces challenges with infrastructure, says Planning Director Richard Smith. The Cabarrus County city is regionalizing its sewage system similar to what’s taking place in Pittsboro and Siler City, according to Smith. The expansion will take until at least 2027. Kannapolis reports 17 residential development projects with about 3,638 total units are on a waitlist for wastewater allocation. These projects may have to wait for completion of the expansion unless other developments drop off that list. STAYING IN PLACE Topography and culture make adding housing difficult in western North Carolina, including Buncombe and Henderson counties. “If we’re going to put more housing in, where is it going to go, and how do we maintain the character of the community,” says Holloway. “People don’t want apple orchards to become subdivisions, but we also know we need more housing.” If it’s not an orchard, he adds, “it’s probably a mountain. There’s only so many places where we can put housing in and have it be reasonably affordable to develop.” On a statewide level, Andrews says interest rates rising to the highest levels in 22 years is contributing to the housing shortage. Homeowners who bought before the pandemic typically have lower fixed-rate mortgages than those wanting to purchase a home now. This discourages homeowners who would typically move to a more expensive house. “Because the middle people don’t want to give up the current mortgage that they have, it’s put a real bad gridlock in the system,” he adds. “We don’t have that cycle or flow that we normally have.” The lack of supply is causing people to pay a premium for housing in many areas, according to LaMontagne. In Burlington, Concord, Kannapolis, Mebane and Siler City, 30% of households are spending at least 30% of their income on rent or mortgages, which makes them “housingcost burdened,” according to the conventional definition. In Clayton and Hendersonville, it’s more than a third. The statewide average is 27%. The lack of supply contributes to people paying more to live
in substandard housing, especially renters, says Anna Tuell, director of development and finance at Chatham Habitat for Humanity. “The rent that people are paying is super high for what they’re getting,” says Tuell. “People might look at that and say, ‘You’re paying $1,200 to live in a trailer and there are holes in the floor. You’re a renter; go find somewhere else to rent.’ But it’s really difficult to find something that’s the same level of affordability [in Chatham County], not that $1,200 a month is affordable for a lot of people. But, it’s hard to find something that’s cheaper or even that same price that’s not just as bad.” INDUSTRY PAYS ATTENTION The good news is that average incomes are expected to rise because of projects such as VinFast, Toyota and Novo Nordisk in Johnston County. But the tradeoff is that affordable housing in these areas may become even more scarce, according to UNC’s Malizia. “The odds that home builders will construct housing that’s more affordable than the existing housing stock is unlikely,” he says. “Homebuilders will target potential buyers who can afford the product they’re building.” Town and city planners try to address the need for a balance of higher-end housing and affordable housing through zoning and land-use plans, according to Holloway. But it often takes a significant amount of time for prospective residential developments to pass through the zoning process, in some cases contributing to housing supply limitations. If increasing housing supply takes too long, it can influence the timing of economic development projects, Malizia says. Employers planning large economic development projects understand the situation and believe they can attract a sufficient workforce despite the housing crunch. “They already know and are aware of the problem and monitoring it,” he adds. “If push comes to shove, and they don’t feel like they have the ability to house the workforce within a reasonable commute, they’ll move.” ■ CHATHAM COUNTY BUILDING PERMITS FOR SINGLE-FAMILY HOMES
900 800 700
709 646
600 576
500 400
761
588
545
601 508
483
300 200 100 0
2014
2015
2016
2017
2018
2019
2020
2021
2022
2023
source: Chatham County F E B R U A R Y
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NCTREND ››› Retail
LION TAMER
Sonja Nichols bets on brick-and-mortar retail with a multivendor marketplace in south Charlotte.
By Cathy Martin
W
“WE JUST CAN’T LET THIS DIE.” Nichols is a civic and philanthropic leader whose previous roles include president of Good Friends Charlotte and board chair of the Women’s Impact Fund. She also was appointed to the UNC System Board of Governors in 2021. A Republican, she ran for the state Senate in 2020, losing to Jeff Jackson. Nichols can’t explain what inspired her to start the business, 16
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except that “God put it in my spirit,” she says. She and her daughter paid a visit to Blacklion and struck up a conversation with general manager Maureen Rudolph and a few merchants. She casually asked if the owners might be interested in selling. “And they were like, So you heard — the Blacklion already sold,” Nichols recalls. Elisabeth Emory, the daughter of Blacklion owners Bob and Nita Emory, planned to move the Blacklion concept to Chicago. New owners had bought the building and new tenants were being announced soon. The Blacklion merchants had no idea what they were going to do next. We just can’t let this die, Nichols thought. She called her friend Joan Zimmerman, whose family ran Southern Shows and founded Charlotte’s Southern Christmas Show in 1968. “When Sonja shared what she was thinking … my response, as I recall, was: Sounds like a perfect fit. If I were younger I’d do it myself,” Zimmerman says. Nichols sprung into action. Since the Blacklion name wasn’t for sale, she had to devise a new moniker. “What I came up with was my favorite two things to do: The Southern Christmas Show and the Blacklion. So I merged the names.” Nichols considered a vacant Toys “R” Us building, but
PHOTO CREDIT: RICHARD ISRAEL
alking into Southern Lion’s temporary pop-up shop, I expect to find a few dozen vendors with makeshift displays — folding tables, portable racks and the like. But this is no ordinary pop-up. There are gobs of holiday gifts and décor. A massive Vera Bradley store-within-a-store. Children’s and baby clothing, pet products, and gourmet snacks galore. Tidy displays of luxurious soaps and lotions. Furniture (and more furniture). A fully landscaped pond, with twinkling Christmas lights reflecting off the surface. Owner and president Sonja Nichols greets me for a tour, smartly dressed wearing comfortable black sneakers for traversing the 55,000-square-foot showroom, the upper level of a former Sears department store at Carolina Place Mall in Pineville. Nichols debuted the concept for Southern Lion soon after Blacklion Gifts & Home Furnishings Marketplace shocked longtime customers in 2022 by announcing plans to close after 27 years. Building on Blacklion’s foundation in a site about a mile away, Nichols is looking to create in Southern Lion a similar shopping experience in a larger venue with more bells and whistles. Nichols believes it will be the largest 100% Blackowned retail store in the Southeast.
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realized it was too small. She found another option nearby: At 83,000 square feet, the ground floor of the former Sears store had ample room for the 90% of former Blacklion merchants who committed to join Southern Lion, and then some. Plans to open in March 2023, soon after Blacklion’s January closure, were pushed back due to construction delays. Nichols had planned to use the upstairs of the Sears store for storage. Then it hit her — why not create a temporary shopping experience while carpenters hammer away downstairs? With tape measures and rolls of blue masking tape in hand, Nichols and her crew set about dividing the upstairs space so the merchants could get back to business. Southern Lion’s Popup Shop Up Top opened in September with 65 merchants.
PHOTO CREDIT: RICHARD ISRAEL
LEARNING FROM EACH OTHER Patsy Barnett ran her home décor business, Barnett’s Custom Designs, out of Blacklion for 28 years. “Sonja has put a lot of thought into all of this,” Barnett notes. “And naturally, with Bob’s assistance, that’s been a great help.” That’s former Blacklion owner Bob Emory, who, along with Zimmerman, serves as a consultant for Southern Lion. While Nichols has experience leading large organizations, retail is new territory for her. “I’m your nonprofit person,” she says. “But I grew up in an entrepreneurial family, so I know how to run stuff,” says Nichols, whose grandparents owned nightclubs and grocery stores in San Francisco. She’s also learning from veteran vendors like Barnett. “These are all small business owners, and they are serious about their business,” Nichols says. “They understand how to source materials, they understand budgeting, they understand how to run their business. The only thing I really need to do is to provide a wonderful space for them to operate out of.” Those small businesses include The Raggedy Rooster, one of Blacklion’s largest merchants, and Carolina Bags, with its selection of Carolina-made products by Piedmont Pennies, Poppy Hand-Crafted Popcorn, Dewey’s and others. A Christian bookstore is one of the top volume enterprises. Nichols has taken the merchants’ feedback to heart in designing Southern Lion’s permanent home. Features like walls for sound barriers and electrical outlets for each vignette are being integrated into the new space. THE ANTI-AMAZON “Blacklion was famous for having those unique things that you just couldn’t get anywhere else,” Nichols says. Southern Lion plans to continue in that tradition. “We had a leathercovered toolkit … Who needs that? But that was one of the first things we sold.” With roughly 17,000 additional square feet, Southern Lion will be able to accommodate even more merchants. When the new permanent space opens in the spring, shoppers can expect a café selling prepared foods along with a meeting room for about 100 guests. A men’s lounge with recliners and TVs tuned to ESPN (already a popular feature in the upstairs pop-up) will also feature items for sale like cigar humidors, a leather-covered Coleman cooler and collegiate decor, such as a wooden end
table with a lighted, inset 3-D replica of UNC’s Dean E. Smith Center or Clemson’s Memorial Stadium. One thing you won’t find at Southern Lion: online sales. The headaches of shipping and returns aren’t worth it, Nichols says. “I want to be the anti-Amazon. I want people to be able to come in, touch the pillows. … You can’t get this experience online — you can’t do it.” Once the main store is open, Nichols is considering a few different ideas for the upper level, including estate sales or a permanent expo for home remodelers. “A COMPLETE FAITH WALK.” Nichols is unfazed by media reports about dying malls and slowing sales of brick-and-mortar retail, including Carolina Place, where owner Brookfield Properties defaulted last year on a $149 million loan tied to the 32-year-old mall. “The mall has been altogether lovely to me,” says Nichols, who is leasing more space than all but two other tenants. She’s considering bringing the Southern Lion concept to malls in other cities. “I feel like this is my lane, because this is something I love to do,” says Nichols, who goes to work every day. Rich Nichols, 32, the oldest of her three children, joined the business as vice president of finance after returning to Charlotte during the pandemic. He has an MBA from UCLA and has worked for Deloitte and Georgia Pacific. “This is a complete faith walk,” Nichols says, gesturing across the vast showroom. Her investors, including her husband, Richard, have poured more than $5 million into the venture. “What I’m doing right here is the riskiest thing in my entire life,” she adds. “Nowhere did I ever imagine this, at no time. I couldn’t have planned it, but it is my most fun thing to do.” ■ This story first appeared in SouthPark magazine, an affiliate of Business North Carolina.
Pictured from left: Maureen Rudolph, general manager and leasing agent; Rich Nichols, vice president of finance; Sonja P. Nichols; Odetta Maxwell, store manager of human resources; J. Eric Mechum, store manager of operations. F E B R U A R Y
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NCTREND ››› Statewide
CHARLOTTE CHARLOTTE
Content staff at 90.7 WFAE signed their first labor contract with the station since forming a union with SAG-AFTRA 14 months ago. The bargaining unit overwhelmingly voted to approve the 3.5-year agreement, which guarantees higher minimum salaries for fulland part-time employees and annual raises.
Enpro acquired California-based Advanced Micro Instruments for $210 million to expand its analyzers and sensors business. Enpro also promoted Joseph Bruderek Jr. to chief financial officer, effective April 1. He will replace Milton Childress, who is retiring. HMS Host, which operates the two American Airlines’ Admirals Clubs at Charlotte Douglas International Airport, plans to lay off 91 workers in March. Sodexo Magic is providing food and beverage service at the two clubs, starting on March 4. HMS Host expects many impacted workers to receive offers from that company. Truist Financial is closing about 80 branches by March, continuing its cost-cutting moves aimed at boosting profit. The bank hasn’t given a specific number of branch closings, but industry trade publications reported it would be about 3.5% to 4% of its 2,006 existing offices in 17 states and the District of Columbia.
N.C. Attorney General Josh Stein filed a lawsuit against A1 Towing Solutions and its owner David Jewel Satterfield, alleging that it racially targeted consumers and illegally booted and towed their vehicles. Stein previously sued the company for allegedly violating state price gouging laws during COVID-19. Satterfield denied wrongdoing. Charlotte FC hired former Aston Villa manager Dean Smith as its head coach. Smith replaces Christian Lattanzio, who led the club to the playoffs for the first time last year. The team was formed in 2022.
Honeywell International acquired Floridabased Carrier Global Corp.’s Global Access Solutions business for $4.95 billion. Honeywell adds the LenelS2, Onity and Supra brands, cloud-based electronic real estate lockboxes that provide mobile access management. Atrium Health and Novant Health have declined to sell or donate their bad debt to RIP Medical Debt, a national nonprofit that buys unpaid medical debt, then forgives it. The hospitals said they already have substantive charity policies and financial assistance programs.
The Carolina Panthers and Bank of America extended their naming rights partnership for Charlotte’s NFL stadium. The original 20-year, $140 million naming rights contract ends next year. Bank of America and predecessor NationsBank have been the sponsors since the team’s first season in 1995. Bank of America Stadium opened in 1996. Duke Energy hiked rates for customers in central and western North Carolina. State regulators approved a three-year, 14.6% rate hike for customers of Duke Energy Carolinas, which stretches from Durham to the mountains. Duke asked for a 15.7% rate hike. Florida State sued the Atlantic Coast Conference, challenging an agreement that would bind the school to the league for the next 12 years with more than half a billion dollars in fees for leaving. The suit claims the ACC has mismanaged its members’ media rights. In a pre-emptive counterattack, the ACC filed a lawsuit against the Florida State Board of Trustees, claiming the school could not challenge the grant of rights that it had signed.
CHARLOTTE Johnson & Wales University, known for its culinary and hospitality curriculum, plans to convert a 187-room hotel it owns in downtown Charlotte into student housing. The DoubleTree by Hilton Charlotte Uptown will operate through June and then house upperclassmen beginning with the fall semester this year. The university’s strategic plan is to increase enrollment from its current 1,028 students.
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Hornets Sports and Entertainment unveiled plans for a $215 million renovation at the cityowned arena known as Spectrum Center. The work means the 19,000-seat arena that also holds concerts and other events will be closed from May through September in 2024 and 2025, which is the NBA team’s offseason period.
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BELMONT Lynddahl Telecom America, a Danish company which makes ductwork for fiber optics installations, will create 54 jobs and invest more than $5.6 million to build its first North American plastic extrusion production site here. Average salaries for the new positions will be $60,315, exceeding the Gaston County average of $50,746.
GASTONIA The city is cutting its regular bus routes and replacing them with on-demand service. The bus system drew 144,000 riders last year. Starting in July, the city will instead offer on-demand rides through a three-year, $1.65 million contract with River North Transit. Instead of waiting at bus stops along set routes, riders will use an app, website or call center to schedule a ride directly.
KANNAPOLIS Atlantic Fish Co., a startup that’s cultivating seafood from fish cells, secured a $100,000 loan from the North Carolina Biotechnology Center. Doug Grant co-founded the cellular seafood startup with Trevor Ham in 2020. Through a partnership with the North Carolina Food Innovation Lab, Atlantic Fish is developing its first marketable product.
LOWELL
MOORESVILLE
City Council authorized a $200,000 settlement with former Police Chief Gina Hawkins. Hawkins, in a letter from Raleigh attorney James Hairston, earlier threatened legal action against the city for what Hawkins says was a hostile working environment. Hawkins was the city’s police chief from 2017 to February 2023. Lowe’s Cos. is launching its first customer loyalty program at its stores. The retailer said the loyalty program will expand nationwide in March. CEO Marvin Ellison said it becomes “the only national home improvement retailer with distinct loyalty offerings that cater to both pro and DIY customers.”
MOUNT GILEAD PaperWorks, a paper packaging manufacturer for the food industry, will permanently close its operations here at the end of March, which will result in 74 people losing their jobs. PaperWorks, based in the Philadelphia suburb of Fort Washington, cited “financial reasons.”
SALISBURY Germany-based DHL Supply Chain will invest more than $40 million and create more than 80 jobs. One of the world’s largest shipping companies, with U.S. headquarters in Ohio, DHL is leasing a 713,000-square-foot warehouse at the Innovation Logistics Center. DHL expects to be operating at the facility by this summer.
EAST International Express Trucking was acquired by Atlanta-based BWT Logistics for an undisclosed amount. International Express, founded in 2001, operates a 70-acre location in Cherryville, the former Carolina Freight complex purchased in 2020 for $1.3 million. It provides trucking, warehousing, and distribution services in Charlotte and Atlanta. Howard Shope, president and CEO of International Express, will join BWT as a senior vice president of operations and retain an ownership stake.
FAYETTEVILLE
ELIZABETH CITY A switch in military contracts will result in job losses for 92 workers who perform aircraft maintenance on C-130s at the U.S. Coast Guard base in Elizabeth City on Feb. 3. However, Timothy Boesche, operations manager for Chantilly, Virginia-based Amentum, says he expects all employees to receive job offers from Logmet, the Austin, Texas-based company that will take over the work.
GREENVILLE Elon Musk, the owner of X, appealed to YouTube’s biggest star, Greenville native Jimmy Donaldson (aka “MrBeast”) to post his videos on the platform, and was promptly rejected. The social media mastermind, who earned an estimated $82 million in 2023, told Musk the platform couldn’t “fund a fraction” of his costs. The East Carolina University School of Dental Medicine and the University of Florida College of Dentistry received a five-year, $3.7 million grant from the National Institute of Dental and Craniofacial Research. The grant will be used to establish an academic multidisciplinary practice-based research network within and between their respective dental schools
KINSTON
Charter-flight operator flyExclusive began public stock trading Dec. 28 after completing its combination with a New York special purpose acquisition company. SPAC company EG Acquistion’s deal with flyExclusive was announced in October 2022 with an estimated equity value of $600 million at the time.
LELAND About five miles of I-140 will be resurfaced here by Fayetteville’s Highland Paving. The N.C. Department of Transportation awarded the company $9.6 million in December. The work includes preservation of several bridges along the stretch of roadway, sealing cracks and treating concrete driving decks. F E B R U A R Y
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NCTREND ››› Statewide MOREHEAD CITY Centricity Research, a large clinical research company with main offices in Columbus, Georgia, and Toronto, acquired Lucas Research for undisclosed terms. The North Carolina business was cofounded by husband-and-wife team Seth Medlin and Dr. Jeannie Lucas operates offices at its headquarters here and New Bern and Hickory with a combined 70 employees.
WILMINGTON
The Port of Wilmington’s rail system will receive $3.4 million in state funding for upgrades through a partnership between rail companies and the North Carolina Department of Transportation. The State Ports Authority will get as much as $2.8 million to build new tracks at the Port of Wilmington. Wilmington Terminal Railroad received close to $600,000 for updates.
famously was cut from his high school team before starring at UNC Chapel Hill and the NBA. He sold the Charlotte Hornets last year for $3 billion.
WILSON Ernie Bovio is the new president of Novant Health New Hanover Regional Medical Center. He had been president of UNC Health Rex for the past five years. COO Kirsten Riggs will serve as interim president at UNC Health Rex until a successor is named. William Louis Willis of Morehead City, a managing member of the company that owns Shuckin Shack Oyster Bar, pleaded guilty to felony tax charges filed by the N.C. Department of Revenue. The state said he aided the business to convert $94,510 in sales tax from 2017 to 2021 for its own use, according to court records. Willis received a suspended prison sentence, and was ordered to pay back the sales tax and perform 50 hours of community service. Relatives of Michael Jordan and New Hanover County officials entered into a memorandum of understanding outlining the next steps to develop a Jordan family museum in the center city. Jordan
The Carolina Mudcats appear to be headed east from their home since 1991 in Zebulon. The City Council unanimously passed four resolutions in December to make Wilson’s proposed ballpark project a reality. The council OK’d an agreement with New South Ventures, guaranteeing $212 million in downtown economic development. The Mudcats are the Class A affiliate of the Milwaukee Brewers.
WRIGHTSVILLE BEACH Kristian Bawcom, the owner of iconic Chapel Hill restaurant Four Corners, is bringing the brand here. Bawcom acquired the former Soundside Seafood & Raw Bar site within walking distance of the Wrightsville Beach bridge, for $2.46 million from Urban Food Group of Raleigh.
TRIAD EDEN The Federal Energy Regulatory Commission granted the MVP Southgate project a three-year extension to complete pipeline construction. The 75-mile pipeline, which would carry natural gas, is an extension of the Mountain Valley Pipeline. It enters North Carolina from Virginia near Eden before running by Reidsville and Graham before ending in Alamance County.
GREENSBORO
ROCKY MOUNT Engine giant Cummins plans a $580 million expansion here that will add 80 jobs, aided by a 50% tax abatement approved by the Nash County Commission. Cummins has built engines here since 1983, where it employs about 2,000 workers.
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Sargent, a contracting firm based in Orono, Maine, opened a six-person office here after landing some assignments at Piedmont Triad International Airport. The company, which employs more than 450 people, has handled a $23 million earth-moving contract to allow for construction of the Boom Supersonic and Marshall Aerospace plants near the airport.
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NCTREND ››› Statewide
Topgolf plans to open a two-level, sportentertainment venue in a shopping center development near the Guilford College Road exit of Interstate 40 in late 2024. RLF Communications, based here, acquired Raleigh public relations agencies GBW Strategies and Clairemont Communications for undisclosed sums. Clairemount founder Dana Phelps becomes RLF’s chair and GBW cofounder Billy Warden is chief strategy officer. In January 2023, RLF also bought Raleighbased Baering Group.
HIGH POINT Scott De Rossi, the founding dean and professor of the Workman School of Dental Medicine at High Point University, departed. An assistant, Muhammad Ali Shazib, was selected as the new dean. The first private dental school in North Carolina expects its first cohort of students this fall.
WINSTON-SALEM
DURHAM
Nathanael Tarwasokono will become president and CEO of Allegacy Federal Credit Union on Feb. 15. Cathy Pace, a 45-year employee, and the CEO for the past 10 years, will remain with the credit union through early 2025. Tarwasokono is now CEO at Firstmark Credit Union in San Antonio, Texas. Allegacy started in 1967 as a credit union serving R.J. Reynolds Tobacco employees. It has $2.2 billion in assets, 450 employees and 18 offices in the Triad and Charlotte.
Proto Labs paid $16.2 million in early December for a single-story commercial space here, acquiring the property from Grove Warehouse Pleasant. The property, which was designated for commercial use, was built in 2022, features 120,000 square feet and sits on a 4.8-acre lot.
Piedmont Financial Holding, which owns locally based Piedmont Federal Savings Bank, completed its $15 million purchase of Wake Forest Bancshares. The deal adds about $120 million in assets to Piedmont Federal, which has $1.1 billion in assets and 10 branches in the Triad, Boone and Wilkesboro.
CARY
CHAPEL HILL
VinFast, the Vietnamese electric carmaker building a multi-billion-dollar factory in Chatham County, replaced its CEO and chief financial officer. Billionaire Pham Nhat Vuong, chairman of VinFast’s parent company Vingroup, will assume the role of CEO. Outgoing CEO Le Thi Thu Thuy will chair VinFast’s board.
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The public schools system plans to move Durham School of the Arts from downtown to a new building in north Durham. The cost of the move will be $240 million with an opening set for the fall of 2026.
TRIANGLE
Video game maker Epic Games won an antitrust lawsuit filed against Google, with a jury finding the tech giant’s mobile phone app store to be an illegal monopoly. The decision, if it survives the appeal process, could upend how the two major mobile operating systems control the distribution of third-party apps on devices.
MONCURE
Drug developer BioCryst laid off 50 employees, or 10% of its workforce. Its stock price gained more than 25% after it reported $89.9 million of fourth-quarter net revenue and projected its first earnings in the next two years. BioCryst’s fourth-quarter net revenue grew by 27% in 2023.
Lee Roberts became UNC Chapel Hill’s interim chancellor while the flagship state university conducts a national search for a permanent leader. Roberts is the co-founder of North Carolina-based SharpVue Capital and had been a member of the UNC System’s Board of Governors. He succeeds former Chancellor Kevin Guskiewicz, who is now Michigan State University president.
Houston-based Hines Global Income Trust, a real estate investment, development, and property manager, acquired the IBM 500 Campus, a 774,000-square-foot property adjacent to Research Triangle Park. Terms were not disclosed. The four buildings are fully leased by IBM. Robert Claypoole is the new CEO of Bioventus, which provides pain management products. Claypoole has been executive vice president at Mölnlycke Health Care AB. He succeeds Anthony Bihl, the interim CEO since April. The N.C. Department of Labor fined Raleighbased Southern Industrial Constructors $20,825 for violating a pair of workplace safety rules in connection to the July accident led to the death of a welder at the headquarters of semiconductor manufacturer Wolfspeed. For failing to secure an elevated hole, Southern Industrial was fined $15,625, the maximum amount by law.
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NCTREND ››› Statewide FRANKLINTON Town commissioners here and in Wake Forest approved resolutions to support a study into how a toll road might affect U.S. 1. Between 32,000 and 65,000 vehicles travel the U.S. 1 corridor per day, and traffic is anticipated to increase to 44,000 to 75,000 vehicles per day by 2040.
MOORESVILLE NightHawk Biosciences divested a subsidiary, Elusys Therapeutics, a New Jersey drug developer with an anthrax antitoxin called Anthim. NightHawk expects the Elusys divestiture and R&D cuts to eliminate $40 million in commitments and reduce operating expenses by more than $13 million.
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MEBANE Buc-ee’s, the Texas-based gas station chain famous for its massive size, beef brisket and clean bathrooms, had its first North Carolina location approved for construction here. The town council overruled its planning board, which voted to deny the request. Buc-ee’s plans to build a 75,000-square-foot travel center with 120 gas pumps on 32 acres of land near Interstate 40/85. The station will employ about 225 workers.
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NCTREND ››› Statewide OXFORD Gate Precast, which makes precast concrete for major construction projects, plans to lay off 77 workers by Feb. 9, and further layoffs of fewer than 50 workers will occur after that. The plant will permanently close on July 1, according to a state filing. The Jacksonville, Florida-based company will continue to service the Carolinas out of other Gate Precast facilities.
Insurance companies asked state regulators to increase homeowners’ insurance rates by an average of 42.2%, effective in August. The requested rate hikes vary by region. Insurance companies have asked for a 99.4% increase in the beach areas in Brunswick, Carteret, New Hanover, Onslow and Pender counties. In metro areas, the industry is asking for a 39.8% increase for Raleigh and Durham, a 36.6% increase for Greensboro and a 41.3% increase for Charlotte and the surrounding area. First Citizens Bank and Trust paid $86.7 million for an office complex in Santa Monica, California. Realty Bancorp Equities had defaulted on more than $100 million in loans tied to the property. The deal came out to $1,131 per square foot.
Hilltop Village, an 80,000-square-foot shopping center, was sold for $5.1 million. Food Lion anchors the property. Jacob Baruch and Jonah Warshaw of Legacy Realty Group Advisors represented the buyer in the transaction, while Adam Palmer of LQ Commercial Real Estate Services represented the seller.
RALEIGH Leith Automotive Group, one of the largest car dealership companies in North Carolina, agreed to sell to New Jersey-based company Holman for an undisclosed price. The deal is expected to close by the end of March. Leith has more than 2,000 employees at 30-plus dealerships. Mike Leith started the business in 1959. Separately, Leith says it will be the flagship dealer for VinFast, the Vietnamese company planning a factory in Chatham County.
The Carolina Hurricanes bought Backyard Bistro, a restaurant across the street from PNC Arena where the hockey team plays. The restaurant and bar, which opened in 2009, will continue to operate with executive chef Joe Lumbrazo remaining.
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Audemars Piguet, the Swiss luxury watch manufacturer, plans to invest $22 million and create 105 new jobs in Raleigh. The company will locate its North America service center in the Raleigh Iron Works. The 63,000-square-foot real estate deal was the largest new-to-market office lease for 2023 in Raleigh.
Midtown Plaza, a fully leased 330,000-squarefoot office building in North Hills, was sold for $132.9 million to Crescent Real Estate of Fort Worth, Texas, according to Wake County records. Houston-based Lionstone Investments sold the 12-story office building, State Treasurer Dale Folwell divested $40 million in shares of Unilever, after the company’s Ben & Jerry’s subsidiary boycotted Israel. N.C. statute prohibits “the North Carolina Retirement Systems or the Department of State Treasurer from investing in any company engaged in a boycott of Israel,” Folwell noted. City leaders unanimously approved the $20 million purchase of the old DMV headquarters site. The city hopes to close on the site in March, and then spend about $3 million to clean up asbestos, lead and other issues. City leaders hope the 6-acre development can become a resource for the community with affordable housing, daycare and possibly a grocery store. Atlanta-based East West Manufacturing, a design, manufacturing and distribution business, will close its plant here on March 2 and lay off 107 workers. East West acquired Team Manufacturing, which specializes in electronics, in 2018.
Prometheus Group, a provider of various enterprise management software solutions, acquired the MobilOps product suite from Louisiana-based Turner Industries. Financial terms weren’t disclosed.
Drone developer PrecisionHawk filed for Chapter 7 bankruptcy liquidation five years after announcing a $32 million funding infusion and moving its headquarters. The bankruptcy filing identifies assets worth over just $3.8 million while the company’s debts add up to nearly $17.6 million, including $243,000 of unpaid rent for its Glenwood South headquarters.
MBA programs at the Triangle’s three research-oriented universities declined last fall. UNC Chapel Hill’s program declined by 11.6%, compared with 8.5% at N.C. State University and 4.7% at Duke University. Nationally, MBA applications declined 4.9% last year. The City Council approved Fallon Cos.’ request for rights to build a 40-story mixed-use tower on Hillsborough Street. The site had previously been restricted to 20 stories. It is part of the Raleigh Crossing project now anchored by a 19-story office building.
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WEST CHEROKEE A company that provided workers to the Harrah’s Cherokee Casino Resort plans to lay off 88 workers. The Service Cos. says the Tribal Casino Gaming Enterprise, which operates the resort, has decided not to renew its service agreement, and that the workers will be terminated on March 4. According to the Smoky Mountain News, the Tribal Casino Gaming Enterprise recently cut its budget for the 2024 fiscal year due to declining casino revenues.
LITTLE SWITZERLAND
A Jackson, Mississippi-based family business with a long history in the lodging industry has acquired the Switzerland Inn, a 70-room resort near the Blue Ridge Parkway. MMI Hospitality bought the inn and two adjacent homes from Gary Jensen, whose family has owned the Mitchell County resort for about 40 years. The sales price was $15.6 million, according to Marcus & Millichap, which marketed the property for Jensen.
MURPHY Harrah’s Cherokee Valley River Casino and Hotel expects to open its $275 million expansion project this year. It’s the casino’s first major expansion since it opened in 2015 and will add 25,000 square feet to the gaming floor. ■
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STEADY, SLOW GROWTH The Business North Carolina economic forecast panel convened in early January at the Campbell University Law School in downtown Raleigh to discuss the state’s economy and where it’s headed. Unlike last year, when many predicted a recession for 2023, the panelists believe that the current year will see slower growth, but no recession. The state is well positioned to weather any economic headwinds, they believe. Photography by John Gessner
Anita Hughes Bachmann CEO, UnitedHealthcare Community & State, North Carolina
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N.C. State Senator Jim Burgin District 12, Hornett, Lee and Samson Counties
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Matt Brubaker
Anthony M. Copeland
president, Greenfield Communities
senior economic development and corporate strategist, Brooks Pierce
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The discussion was sponsored by: •Brooks Pierce •Campbell University •First Bank (FBNC) •Humphrey & Leonard, LLP •McLendon •UnitedHealthcare Chris Roush, executive editor of Business North Carolina, moderated the discussion. It was edited for brevity and clarity.
WHAT DO YOU SEE HAPPENING WITH THE ECONOMY IN 2024? STECKBECK: I’m Dr. Mark Steckbeck, associate professor of economics at Campbell University, and the Lundy Chair of Business Philosophy. A lot of people are saying the Fed is probably gonna lower rates this year, maybe a little. I still think they’re gonna hold steady this year at 5.3%. I really don’t see them making much of a change. And the reason for that is we do see inflation going down, but we still see wage inflation. We still see housing prices are up. They are coming down considerably, but they’re still up over some longer term trends.
North Carolina has actually done pretty well. We have an unemployment rate of 3.4%, which is half a percentage point less than the U.S. as a whole. Wages are still higher or higher than the Feds average that they’re looking for but still doing pretty well. Manufacturing is one of the hardest–hit labor sectors in this state. But it’s also poised to really rebound a lot with getting the Toyota plant, things like that. The biggest change is going to be in education and healthcare, those areas are going to have a larger increase in labor employment. One of the things I really want to look at moving forward with these projections are a couple things that I would be a little concerned with. The first one is leading indexes. For North Carolina, it’s actually a big positive. Whether it’s manufacturing, the initial applications for unemployment, those have been up. North Carolina is actually doing really well with that. I put about a 20% chance of a resurgence in inflation. And if that happens, the Fed is going to further raise interest rates. I don’t think that’s going to be a significant indicator. I think moving forward, I don’t see a recession, especially with the economic development going on.
WILLIAMS: I’m Hope Williams, president of North Carolina Independent Colleges and Universities. We’re the statewide office for the 36 private nonprofit colleges and universities across our great state, and I’m also delighted to highlight the fact that we have 16 outstanding public universities and 58 incredible community colleges. One of our primary goals is to help provide an excellent workforce. We all want to see a three-peat of North Carolina as the best state in the country for business. Part of our goal is to be sure that we’re responding to the needs of business. And so there are exciting trends underway in growth and expansion of multiple types of programs. The number of engineering schools has grown in our sector. The demand for healthcare workers all across the board is so strong. We now in the independent sector award 90% of the physician assistant degrees in the state. So we want to make sure that we’re meeting those needs, and we certainly want those students and graduates to stay in North Carolina. I do want to mention a challenge that we need to be aware of. Since
Adam Currie
Ged King
Mark Steckbeck, MD.
Hope Williams
president, First Bank
president. Sales Factory
Lundy Chair of Free Enterprise and associate professor of economics. Campbell University
president, North Carolina Independent Colleges and Universities
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2000, when we had about 63,000 high school graduates in our state, we got about 100,000 in 2015. And now we’re up to about 111,000. But the next couple of years will probably be lower. Along with many other states in the South, we actually are going to plateau in high school graduates. And we have a significant increase in the students who are graduating from North Carolina high schools who are going out of state to college. For years, 7% to 8% of our students would leave North Carolina to go to college. Now it’s 17% and heading toward 20%. These other states are coming after our students because they know from research that students who graduate are likely to stay. So if we want our best workers to be able to help make this a great economy, we need to figure out how to help keep those students. So one of the things we’re looking at is helping our students have more internships and other experiential learning opportunities in our companies to be sure that they make that connection right here in North Carolina. We want to help keep those folks in North Carolina and help meet the needs of our North Carolina employers. KING: I’m Ged King. CEO of Sales Factory, a marketing and advertising agency in Greensboro. I study consumer behaviors. I can tell you 30
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what I think the underlying concepts are that are driving some of these things we’re seeing. My company does a study of 1,000 Americans every two weeks. We started it the week COVID happened because we were scared and we thought maybe we can learn something in this crazy time. What we’ve learned is the driving force right now in consumer behavior is trust. We’re hearing the economy was going to be bad. Now, the economy was good. Christmas shopping was going to be down. It turns out, it’s up. We don’t really know what to make of it as regular people. So what are we doing about that? We’re losing trust. This is from our data. Trust in the president and the candidates running for president is down 52% year over year. Trust in the Senate is down 57%, the House down 61%, local governments down 44%, North Carolina government down 49%. News media down 52%. Drug companies and healthcare down 47%. So what’s happening is we don’t believe all the people we believed when we were growing up. So there’s a lot of uneasiness. And with that uneasiness comes one other thing that’s very shocking to me, trust in major retailers is up 29%. So the people that are designed to take money from us are actually getting trust that the other institutions are losing. We’re spending and we keep spending. And it’s surprising to everybody. And the consumer is just going, let’s go. But we don’t know when that will stop. CURRIE: I’m Adam Currie. I’m the president of First Bank. We are the largest community bank headquartered in North Carolina. We have about 120 branches in North and South Carolina and about $12 billion in assets. I think
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North Carolina is one of if not the best state to do business in in the United States I think we often take for granted how wonderful our state is, and in a business sense. I think the biggest economic story of 2024 is starting in about three months, our lives will be dominated by the election news cycle, and it will drive everybody crazy. And we will all be sick of it. By the time November comes around, we’ll have an election cycle not only for the United States, but for North Carolina. We have done an excellent job staying in the middle and not creating an environment that’s going to irritate one side or the other. My hope is that we keep that as a state. We look at things constantly like credit card balances, home equity line balances, checking account balances, business account balances. And all of those things continue to tell us that the businesses and people of North Carolina are healthy from an economic standpoint. Inflation has certainly crept into people’s pocketbooks. But wage wages have continued to rise and seem to be for most people keeping up with inflation. Now, I’m sure there are examples where that’s not the case. But generally in our customer base that is what we’ve seen. It has been very difficult in this interest rate environment for banks to make money. There are fewer people out borrowing money and commercial real estate seems to be in a mild recession. I will say it is not the catastrophic event that everybody has predicted in commercial real estate, but people are accepting lower returns, and people are not trading very much real estate. Given that we have an election in November, it will probably stay that way throughout the course of the year. If so, I think it will SPONSORED SECTION
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be very late in the year. I will not put myself any further out on the ledge other than to say I think it will feel a lot like it did this past year. BURGIN: Jim Burgin, representing North Carolina Senate District 12, which is Lee County, Harnett County and part of Sampson County. I’m in the insurance business and car business and dabble in real estate. All of us hate uncertainty. And that’s
what I think we’re going to be dealing with in 2024. I’m chair of the healthcare and healthcare appropriations committees, and I was just getting some updated numbers on how much money is coming in because of the Medicaid expansion on Dec. 1. And so billions of dollars are poured into the state. We’re going to be getting $7.2 billion coming in. And that recurring healthcare cost in North Carolina is really high. I get
calls every week from people wanting to come to North Carolina and offer more services because we have this large pool of money. I think we’re going to see a 1.5% to 3% growth this next year. North Carolina is is so well positioned that if there is a recession, which I don’t think there will be, I think it will be a slight downturn. Like a lot of folks, I think we will be the last to go in and the first to come out simply because
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of our taxation and all the other things. When I talk to companies and most of the time, it’s finance officers, they tell me the first thing to look at is our tax rates. I would like to think that eventually we’ll have zero income tax in North Carolina I do want to talk about one thing. We have a childcare crisis coming up. That’s something that companies are going to have to be looking at. But what we’re trying to do is a combination between the employee, the employer and the state to try to get childcare started on campuses of large employers. So I think childcare is something we’re really going to have to monitor this year. BRUBAKER: I help run a small real estate development company located here in the Raleigh area. We do mostly residential and focus on new home construction. The current state of the housing market is a tale of two worlds. You have the new home sales, the new home housing, and you have the existing housing market. On the new home sales front, it’s just fantastic. New home sales in the Triangle are up about 10% year over year growth. Falling mortgage rates over the last five or six months has really helped to spur some buyer traffic and sales. New home builders are really benefiting from a lack of existing inventory. Over the last 12 months, existing home sales have dropped over 35% in the Triangle. Look no further than the rising interest rates. About 65% to 70% of all mortgage holders have a sub 4% interest rate. There’s just zero interest in trading that out for 7%. Nobody’s really excited about doing that. Now you do have some people that have to move. But I tell you, it’s slim pickings to try and find a home in the new home market. So half the sector is doing great. And half the sector is really struggling. 2024 is a presidential election year. 32
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I think that Washington’s going to do everything they can. If you’re in power, you do everything you can to juice the economy before the election. So I kind of have a wait–and–see attitude toward it. I expect the Fed to maybe lower rates some. I don’t think it’ll be drastic. I think the economy will be OK. I don’t think we’re gonna see off– the–chart growth. BACHMANN: I’m Anita Bachmann, CEO of UnitedHealthCare; our headquarters is in Greensboro. We have the privilege of serving about 1.5 million individuals in North Carolina. And that includes businesses, small–, medium– and large–size employers, as well as serving the Medicare and Medicaid population in the state. I don’t think there’s a better day to be living in North Carolina. We look at the growth, particularly employer growth, in our state over the last 18 to 24 months. I don’t think we’ve seen any state grow like North Carolina. I think a lot of that has to do with the leadership of our state. I think the state made a very bold move with the long awaited passage of Medicaid expansion that happened in December. We actually implemented
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it with over 300,000 individuals. So we think about the economic impact of that, and it’s probably one of the largest economic levers ever. It’s close to $8 billion in federal funds that are coming in on an annual basis. That’s incredible. Think about the impact from a workforce standpoint – there’ll be an additional 37,000 new jobs that will be needed in the healthcare space to help meet the needs I also think about productivity. So we’ve got more people that are now going to have benefits and preventive care services and they’ve never had before. All those things are going to help them lead a healthier life. So productivity in the workforce is going to be much better. Absenteeism is going to be going down because you have healthier people. So that means more productivity with our employers. The more that we can do to simplify healthcare, simplify the language, help consumers navigate the healthcare system, provide the data in the information for them to help make the best decisions, both from a cost standpoint and a quality standpoint, are going to be critically important. When we look at the cost of health care, about 20% of that is related to SPONSORED SECTION
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will continue to be an area of focus in North Carolina. I think for the first time probably that I can ever remember, we are OK talking about behavioral health and mental health. And I think it’s something we’ve got to continue to focus on. So I think growth is going to continue to be a real positive. We will see an increase in workforce as a result of those employers coming in. I see that as an opportunity, but also see it as a challenge. We’re going to need more and more workers and appreciate all the great work that Hope is doing. truly health care services. The other 80% is really related to social determinants, like having access to healthy foods, the way in which a person lives. I think that
COPELAND: I’m gonna say something about Medicaid first. It was an incredible amount of money that we were leaving on the table, not to mention the needs of people that were not going
to have health care access What do I think about North Carolina right now? I think we’re in a very strong position. We have a gross domestic product larger than Sweden. We have over 100,000 people moving into North Carolina every year. So we’re sitting in a very positive position. We have done some things that make us very secure. We have over 700,000 people every day enrolled in community colleges, ane public and private universities, in the state. Very few states have an employee base that it’s growing every day. That’s probably the No.1 thing that we have going for us. The other thing is infrastructure. We have been spending billions of dollars in infrastructure. And in fact, thanks to the legislature, the legislature has been paying hundreds of millions of dollars and put it in projects.
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WHAT IS THE STATE DOING IN WORKING WITH THE FEDERAL GOVERNMENT TO TRY TO HELP LEGAL IMMIGRATION AND GETTING WORKERS WHO ARE CRAFTS PEOPLE, NOT JUST SCIENTISTS AND ENGINEERS?
One of the other opportunities we have in the state is what we do with energy. We’re starting to address some of the energy needs. We’ve got to have a cocktail of different types of energy sources. First of all, we’ve got to ensure that the electric grid is second–to–none in the world. We’re looking at users that are coming in and using hundreds of megawatts of electricity. We have to look at natural gas, and we have to look at wind. If we want to remain a world class state, we’re going to have to develop different energy sources.
Northeast, from California. If I had to put a number on it, I’d probably put it out of 40% would be local moves. And some people are just trying to move up, some of them are moving down, and they just want to downsize. I think it’s pretty much all over the place.
WHAT PERCENTAGE OF THOSE NEW HOME SALES ARE TO EXISTING NORTH CAROLINA RESIDENTS VERSUS THOSE WHO ARE MOVING IN FROM OUT OF STATE?
BRUBAKER: I was actually surprised when I was looking at some data about what percentage of home sales are cash. And it’s not all the big REITs and big companies that are buying homes for rent. A lot of people that have capital that are moving from out of state and they sold from New York at a really high price and their buying power is just better down here. So if you actually can find a house in the existing resale market, you’re in a very strong position because if you’re selling a house, you don’t want that contingency where somebody has to get a mortgage.
BRUBAKER: In short, I don’t know the exact number. A lot of folks that are in the state are just moving. Some of them want to get out of the city, and they want to have kind of a rural life, but they want to be close to the amenities. You also have got people that are moving from the North and the West over to be closer to the grandkids. We’ve got growth coming from the 34
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OF THOSE THAT ARE COMING IN FROM OUT OF STATE, WHAT PERCENTAGE ACTUALLY HAVE A MORTGAGE? OR ARE THEY COMING IN WITH CASH, WHICH DRIVES HOME PRICES UP?
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BURGIN: I’ve talked to all kinds of folks in Washington about how we need to do something. I also think we ought to have a sponsorship program that if an employer sponsors somebody to be here, and they’re responsible for them, then I think we ought to figure out a way to do it and do it legally. But we can’t have an open border. But that is a federal thing that we have to deal with. And we passed legislation, telling our sheriffs they need to cooperate with people as far as getting illegal people out. But it’s going to be a tough thing. Because I guarantee every one of you all know somebody that’s been here and works every day, has bought a house. There was a guy that I’m helping right now. He’s been here 17 years. He spent $30,000 with attorneys. And he has the right documentation, on the path to citizenship, and he’s still on the surface. That’s wrong. STECKBECK: A lot of that is really geographic and sector specific. When you look at the restaurant sector, some of them are closing because they can’t find workers. I was speaking to a pilot trainer yesterday. And I was kind of shocked to hear this, but the number of hours needed to now sit in the cockpit of a 737 has declined from 5,000 hours to 1,500 hours. But they can’t find enough pilots right now. So it depends really on where you are and what you’re doing. ■ SPONSORED SECTION
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SILICON SAVVY First Citizens’ bold conquest raised the stakes and profile of the family controlled bank.
T
By Mike MacMillan
here’s a dispute among analysts about the value of last spring’s acquisition of Silicon Valley Bank by Raleigh-based First Citizens Bancshares. Christopher Marinac, director of research at Janney, says the North Carolina bank essentially got SVB for free. Stephen Scouten, managing director at Piper Sandler, disagrees. “I don’t think they got it for free,” he says. “I think they were paid $16 billion to take it.” The news hit the tape late on Sunday, March 26. Shares of the bank had closed at $582.55 on the previous Friday. On Monday, they ended the day at about $896. By the start of 2024, the stock traded for $1,420, a 250% gain from pre-SVB days. The company's market value now tops $20 billion. It was the second time that First Citizens had essentially doubled in size in the previous three years, after the October 2020 purchase of New York-based CIT Group. First Citizens is now the 13th largest U.S. bank by assets with more than $214 billion, up from $49.9 billion in 2020 before the CIT deal. “It was a fantastic financial transaction,” says Scouten. First Citizens Bank President Peter Bristow is more measured. “It was very accretive for us,” he says, while noting that nothing is certain. “You go in and take a little risk. There is the risk of the unknown.”
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IT’S A WONDERFUL LIFE The 1947 Christmas classic, “It’s a Wonderful Life,” could be viewed as a commentary on the risks inherent in a banking system where banks keep a sliver of capital on hand against potential lending losses and customer withdrawals. Early in the film, a rumored bank failure triggers a run on Jimmy Stewart’s Bailey Savings & Loan, and he is forced to explain to a gaggle of angry depositors why their money is not sitting in the vault. The answer is that it’s at work in the community, building houses and providing capital for business investment. A similar problem bedeviled SVB last March, though on a much larger scale. While Stewart was able to placate his depositors, then-Silicon Valley Bank President Greg Becker could not. In just two days, SVB went from an industry darling to the second-largest bank failure in U.S. history. Stewart’s bank operated in an era before the federal government insured bank deposits. Not so SVB, but insurance limits effectively meant that many of its depositors risked losing substantial sums when the bank collapsed. While SVB held billions in investment grade bonds, those holdings lost value on a mark-to-market basis as the U.S. Federal Reserve lifted the federal funds rate from around zero to more than 5% over a little more than a year. (Bond prices move down as interest rates move up). This created a classic mismatch of assets and liabilities. Depositors noticed and asked to get their money back. Stewart was ultimately bailed out by the townspeople. In the case of SVB, it was First Citizens Bank that swooped in to rescue depositors with significant support from the Federal Deposit Insurance Corporation (FDIC). That support included a $70 billion line of credit and a backstop on SVB losses in
excess of $5 billion. The FDIC is on the hook for half of those potential losses. “When you have voting control, you can run it (the bank) more like a family office,” says Scouten, referring to North Carolina’s Holding family, which controls more than 50% of the voting power at First Citizens through the bank’s Class B common shares. Its actual stock holdings are about 20% of the total. “That allowed them to be nimble.” First Citizens, the biggest family owned U.S. bank, has made a habit of buying distressed banks since the real-estate depression caused hundreds of bank failures 15 years ago. Since 2009, it has acquired more than 20 banks in FDIC-supported deals, according to Bloomberg Law, though most were relatively small. That changed with the purchase of New York City-based CIT in 2020 in a $2.2 billion all-stock deal, which lifted First Citizens into the first rank of regional banks with more than $100 billion in assets. In addition to expertise in commercial lending and equipment finance, the acquisition included OneWest, a regional bank based in Southern California, which CIT acquired in 2015. By the FDIC’s count, First Citizens beat out about 20 bidders who made offers for all or part of SVB, including several small regional banks and private equity firms like giants Apollo and Blackstone. Less enthusiastic were the country’s four largest banks: JPMorgan, Bank of America, Citigroup and Wells Fargo. “There are asset and deposit share considerations for the largest banks in the country,” analyst Marinac notes. “These trigger discussions with the FDIC and Federal Reserve over whether there would be a concentration of assets/deposits that excludes competition. This includes the `Asset Cap’ at Wells
FAMILY AFFAIR Frank Holding Jr. CEO and chair | Hope Holding Bryant, vice chair | Peter Bristow, president (Bristow is married to Frank Holding’s sister)
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First Citizens Bank dates to 1898 when a group formed a bank in Smithfield in Johnston County. It took its current name in 1929, then acquired more than 20 N.C. banks and thrifts in the 1970s, '80s and '90s. Robert Holding, grandfather of the current CEO, joined the company in 1918.
Fargo, which specifically limits Wells’ balance sheet growth.” Instead of SVB, JPMorgan targeted San Francisco-based First Republic, which it acquired in a government-assisted acquisition last May. Of the other two banks Marinac says, “I simply do not think Bank of America or Citigroup was interested in SVB unless they were expressly told to bid by the FDIC and/or the Fed, which I do not believe occurred.” First Citizens, on the other hand, had both interest and the favor of the FDIC, he adds. “First Citizens has a long and positive history with the FDIC doing small failed bank transactions. Then, the company had a strong early execution on the CIT Group merger, which gave them extremely high credibility with the FDIC to handle a large bank transaction such as SVB. The FDIC ultimately chose First Citizens as a ‘known and trusted partner’ instead of a private equity group that has no history of completing FDIC-assisted transactions.” A key worry at the time was the stickiness of the SVB deposit base. The bank was highly exposed to a relatively narrow slice of the market – technology companies and venture capital and private equity firms in and around Silicon Valley. 38
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“This was really about retaining as much of the deposits as you can,” says Marinac. Adds Scouten, “There were expectations for massive outflows. That didn’t happen.” In a July conference call, Bristow noted that about 1,500 companies whose deposits had fallen below 10% of their March 8 balances had recommitted and had more than 100% of their precollapse funds back at the bank. SVB deposits as of Sept. 30, 2023, were about $40 billion, compared with $56 billion when the deal was announced, and down from about $212 billion at year-end 2022. Bristow says that the bank is now “stable on deposits” and “seeing a lot of customer wins and win-backs which is huge for us.” Some runoff is to be expected as companies withdraw funds to finance their businesses. SVB had about 43,000 active deposit accounts at the end of the third quarter. A second worry was retaining talent. Bankers never tire of remarking that theirs is a “relationship business,” and that is true at both SVB and First Citizens. Things seem to have stabilized following an early rush for the exits that saw 42 SVB bankers defect to banking giant HSBC, triggering a lawsuit, and a few more depart for Moelis, a New York-based investment banking boutique. “The core people who created the business are still there,”
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Bristow says. He points to the appointment of 30-year SVB veteran Marc Cadieux as president and the return of Jennifer Friel Goldstein to head business development and strategic initiatives for life sciences and healthcare. Her return was met with a “clap of joy when she walked in the room,” he notes. In September, the bank launched a new nationwide ad campaign, “Yes, SVB,” to remind customers that it is still around. Still, the occasional skeptic can be found, at least as it pertains to the near-term opportunities in venture debt. Venture debt is typically a short-term loan made to an early-stage, high-growth venture capital-backed company. It is secured in part by the expectation of future growth and further access to VC funding, and may include warrants. The benefit is that it is non-dilutive (or less dilutive); the downside is it tends to be expensive and may come with restrictive covenants. SVB’s venture debt footprint is likely to be smaller over the next few years as current portfolio loans roll off, says Zack Ellison, founder and managing partner at Applied Real Intelligence, a venture debt lending shop in Santa Monica, California. While not specifically referring to SVB, he adds that the credit quality for loans made over the last several years is deteriorating. Referring to loans made in 2021, he says, “Almost all those companies have seen their valuations plummet.” For now, SVB’s business remains cyclically slow, consistent with the rest of the industry. A resurgence in initial public offerings (IPOs) would allow some of the bank’s venture capital clients to monetize their investment. Bristow says he is “optimistic it will get better in 2024 though we’re not expecting anything great in the first half. As long as valuations stay down, it makes it hard to get deals done.” He adds, “We’re well positioned to be there when things pick up.” As First Citizens expands its reach into Silicon Valley, one question is the impact on its home state and the Research Triangle area’s technology and life sciences ecosystem. It hasn’t been a historical strength for the bank. Bristow sees opportunities in those sectors, while noting that building on SVB’s expertise in the Triangle will take a little while. “The CIT leveraging is happening now. We’re seeing the effects of that in Raleigh in big, big ways. In time, the same thing will happen on the tech innovation and life sciences side.” Already, he adds, “because of these two transactions we’re seeing deals we wouldn’t have seen before.” Janney’s Marinac also sees potential synergies. “There is more than one success story coming out of the Research Triangle Park,” he says. “First Citizens has been a part of that. They know how to take RTP to the next level. They are a very pragmatic company, and they think way out in the future.”
Some analysts see the potential for more upside in First Citizens stock on the heels of last spring’s hockey stick-like jump. A Piper Sandler report in October had an “Overweight” rating (the equivalent to a “Buy”) with a price target of $1,750 while noting that “stability around the SVB portfolio (was) forming.” Janney carried a “Buy” rating on the stock as of Nov. 2, with an $1,800 “fair value” estimate. Key factors include the expectations for significant stock buy-backs in 2024 driven by excess capital and a continued rise in tangible book value. While the deal’s early risk may be over, First Citizens has noted that the SVB loan portfolio could decline by $5 billion to $7 billion over the next few quarters. “Realistically you’re going to lose some (deposits). These businesses are start-ups and they will burn cash,” Marinac says.
FIRST CITIZENS' GAINS (Assets in billions)
Still, it’s hard to argue with the results so far. If phase one was to stabilize the bank, phase two is to leverage SVB’s historic position as what Bristow describes as the “No. 1 bank in the innovation economy” to begin generating organic growth. That will depend in part on factors beyond First Citizens’ control, in particular a revival in tech investing. But First Citizens can afford to wait, according to Marinac. “They’re (First Citizens) thinking if we don’t get a turn until 2025 or even as far as 2026, we’re OK with that because we want to continue to grow the business with what we have,” he says. “We saw examples of that with CIT in 2022.” Whatever else, the acquisition has so far proven enormously profitable for the bank and its shareholders. And there’s the potential for more upside over the coming years, say analysts. In addition to the financial windfall, “you hoped there was some incremental long-term strategic benefit” when the deal closed, says Scouten. “You’re starting to see that as well.” F E B R U A R Y
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SENIOR SLIDE Consistent losses and failed expansions create an uncertain future for Charlotte’s Aldersgate retirement community. By Shannon Cuthrell
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n November 2022, the CEO of one of North Carolina’s oldest retirement communities sent a letter to early depositors on a major expansion project. Suzanne Hodge Pugh, president of the 231-acre Aldersgate United Methodist Retirement Community, wrote, “While there is no less of a desire to develop the Generations project, the harsh reality is that it is no longer economically viable for [ALPS] to be the sponsor.” Aldersgate’s parent organization, Aldersgate Life Plan Services, had pulled the plug on Generations, a development with 125 independent-living apartments and 16 memory-care suites. In the works since 2018, it was planned for the Shalom Park Jewish community property in affluent south Charlotte, about eight miles from Aldersgate’s east Queen City base. The project had jumped lots of financial and regulatory hurdles, including spending $7.5 million in bond funding for pre-construction activities. Records from September 2022 show 49 depositors reserved 52 units and agreed to pay 10% of the entrance fees, which ranged from about $500,000 to $730,000. In her letter, Pugh cited rising construction costs, interest rates and other inflationary issues. Worse, sales had launched
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two months before the pandemic’s onset, just as fears about living in senior centers mounted. Truist Bank was authorized to return funds to depositors, without penalty for early termination. Unfortunately, there wasn't enough money to offset expenses from planning the project. In subsequent months, financial obligations climbed. Aldersgate owed about $2 million in entrance-fee refunds to former residents and $4 million in overdue bills to vendors. Those delays exposed serious financial concerns at the 78-year-old institution, highlighted by a record operating loss of $11 million in 2022 — its ninth straight annual loss. Aldersgate had a negative fund balance of $45 million, nearly double the amount from a year earlier. It had about $20 million to meet its liquidity needs, down from $33.8 million. In sum, the operation had $193 million in liabilities, including $103 million of long-term debt tied to four revenue bonds issued through the N.C. Medical Care Commission. Assets totaled $148 million. Amid ongoing accounting and cash flow problems, Aldersgate failed to report its quarterly financial condition to bondholders in late 2022. That flagged the attention of insurance regulators who oversee the state’s 66 licensed continuing care retirement communities (CCRCs), housing more than 22,000 residents. In January 2023, two months after the Generations project’s demise, the N.C. Department of Insurance deemed Aldersgate “in imminent danger of becoming insolvent and in a hazardous financial condition.” The department cited delayed bill paying, the absence of a chief financial officer and inexperienced staffing for accounting and billing. Officials required Aldersgate to create a formal correction plan.
according to state filings. A recent Newsweek ranking pegged it the fifth-best continuing-care site in North Carolina, and its size makes it the 46th biggest nationally, according to the latest LeadingAge Ziegler 200 list. Pastors now make up a minority of residents. Despite its history, Aldersgate wasn’t immune to a financial crisis. The corrective action report submitted last May outlined deep problems, including the lack of detailed financial reports dating back two years. The enterprise didn’t have a process to manage cash disbursements and its accounts receivable totaled $6.7 million, with half at least seven months past due. Related activities were recorded through intercompany accounts on Aldersgate’s books, including a $3.4 million write-off from ALPS to Aldersgate for the discontinued Generations venture. In its report, Aldersgate blamed some issues on a former chief financial officer, who allegedly provided incomplete and inaccurate financial reporting through 2021-22. But the finance department was in disarray long before that, with six CFOs since 2014.
HISTORIC HERITAGE The insurance department’s notice received scant public attention, perhaps because the not-for-profit has been a bedrock part of Charlotte for generations. It was formed as The Methodist Home in 1945 to serve retired preachers and widows. Methodist pastors traditionally rotate to different churches every five years or so, typically living in church-owned parsonages rather than their own homes. Organizers of the Methodist Home, and peers such as Givens Estates in Asheville and Arbor Acres in Winston-Salem, viewed the centers as a dignified retirement spot for those pastors. Today, Aldersgate's revenue tops about $40 million annually, with 346 independent and assisted living residences, 125 skilled nursing beds, and 61 memory support units. Newcomers pay entrance fees ranging from about $103,400 to nearly $630,000,
The Aldersgate complex includes the Hezekiah Alexander House, which dates to 1774 and is Mecklenburg County’s oldest home. It was donated to the Methodist Church in 1944 as Aldersgate was forming.
Only one of those officers stayed more than a year, according to a source familiar with the organization. The instability caused major turnover in the finance department “because it became clear the organization was looking for someone who hasn’t been there a long time to blame for problems dating back nearly 10 years,” the source says. Last August, N.C. Insurance Commissioner Mike Causey turned up the heat with an unprecedented “Order of Supervision,” giving Aldersgate 150 days to repay $1.8 million in entrance fee F E B R U A R Y
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ALDERSGATE LIFE PLAN SERVICES
Suzanne Pugh CEO, president
Cherie Grisso chief financial officer
refunds and $3.2 million in accounts payable. He also directed officials to resolve deficiencies within its financial operations. The order was the first issued since the department started regulating CCRCs in 1989. On Jan. 12, Causey extended the deadline to complete the action plan and pay off all past-due entrance-fee refunds for another 150 days. “The N.C. DOI’s involvement with Aldersgate is a singular event, owing as we understand it to some specific circumstances,” says Tom Akins, CEO of LeadingAge North Carolina, an association representing 69 senior living communities. “The CCRC system continues to be enjoyed by thousands of North Carolinians who appreciate this independent living option.” Some communities in Florida have had financial problems, but Aldersgate is a first for North Carolina, says Skip Kingan, president of the N.C. Continuing Care Residents Association. His group lobbied the legislature in the 1980s to pass laws licensing and regulating CCRCs, including a push for residents to join each’s board of trustees. “We wanted directors to understand they have a fiduciary responsibility to residents,” Kingan says. “That was one of the major problems at Aldersgate. The board wasn’t doing its due diligence and following up on responsibilities to oversee management. There’s a lot of good people there. We’re concerned about the residents and how Aldersgate plans to come out of this.”
PASSIONATE POPULACE Following Generations’ cancellation, residents were stunned to learn of Aldersgate’s troubled finances and worried negative press might turn away prospective residents. The resident finance committee sent a vote of no confidence to the board in November 2022. At a meeting a month later, several residents called for CEO Pugh’s resignation. Aldersgate’s primary source of revenue is service fees, so 42
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Brooks Shelley, chief branding & community engagement officer
many residents view themselves as stakeholders in its image and growth. The main campus, Aldersgate at Shamrock, has received high reviews for its quality and amenities, including a fitness center, a pool and spa, walking trails, and six dining venues. In December, Aldersgate won The Charlotte Observer’s “Best Of ” competition, notes Brooks Shelley, the institution’s chief branding and community engagement director. But many residents have expressed continued alarm over Aldersgate’s direction, according to hundreds of emails shared with leadership, regulators and other stakeholders. (The documents were reviewed after a public records request.) “The residents are very savvy consumers, and they are not being treated as such in some ways,” says Ginny Hunt, whose 92-year-old father lives in an independent living cottage. “Transparency, full disclosure and hence trust are huge issues Aldersgate management [must] overcome.” A key complaint of residents is their lack of input as Aldersgate transferred money to the Generations project. The residents' association elects two people to sit on the ALPS board, which totals 11 members. “[ALPS] lost millions taken from Aldersgate residents’ fees to fund these ventures, even while failing to adequately cover current expenses,” notes a resident, who asked not to be identified. The amount of overdue bills owed by the organization and deferred maintenance prompted some complaints. “The CEO said, ‘We’re OK,’” a resident told Jeff Trendel, the insurance department’s deputy commissioner, who is overseeing the situation. “Haven’t seen the renovation guys in weeks! Are the lawns/landscaping next?” Another line sums up the mood: “Promises of action are ignored so often that it has become a campus joke (‘We're working on that’).” Some residents and depositors also questioned whether their estates would be able to recoup the 50% and 90% entrance fee refunds pledged by Aldersgate after a residence ends.
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ALDERSGATE TIMELINE 1943–44 Leaders incorporate a nonprofit for the retirement center.
1945 1948
The campus expands with apartment buildings and cottages.
Aldersgate adds apartments, cottages, memory care and assisted living units, and in-home care for independent residents.
Suzanne Hodge Pugh is named CEO.
Pandemic causes a surge in expenses, worsening ongoing losses. The Sharon UMC project is canceled, prompting a $250,000 write-off.
1980 1999
The skilled nursing center opens with more than 200 beds. The facility rebrands to Aldersgate, the London street where Methodist movement founder John Wesley reported a spiritual revelation in 1738.
Early 2000s 2008
CEO Ray Hall retires after leading Aldersgate since 1984.
2011
Aldersgate Life Plan Services is formed in a corporate reorganization. It oversees plans for expansion on property at south Charlotte's Sharon United Methodist Church and Shalom Park.
2016 2020 Late 2022
Regulators require Aldersgate to develop a corrective action plan.
The Methodist Home for the Aged opens with capacity for 132 residents.
1950s to 1980s 1963
The Asbury skilled nursing care center opens with 100 units.
Methodist Church leaders in North Carolina seek a residential facility for retired preachers and their widows. Reverend Edwin Cole and brother Eugene donate the Hezekiah Alexander building on Shamrock Drive, the oldest home in Mecklenburg County.
Jan. 2023 Aug. 2023
The Shalom Park project, called Generations, is canceled, leading to a $3.4 million loss. State insurance regulators learn of Aldersgate’s delayed payments for vendors and entrance fee refunds. State officials order Aldersgate to complete the action plan within 150 days, stating it operates in a “financially hazardous" manner.
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A DECADE OF OPERATING LOSSES (IN MILLIONS)
*2023 IS THROUGH OCT. 31
source: Aldersgate
The CEO’s role in Aldersgate’s problems is also a common topic. “Suzanne should resign… A CEO like that anywhere else would have been fired,” a resident wrote last February, calling for a 10% pay cut among leadership. Pugh received a salary of $273,086 in 2022 and $332,221 in 2021. In 2014, her salary was $189,247. Pugh declined to be interviewed for this article. In a statement, she said, “I am encouraged by the positive movement over the past year and am very optimistic for continued improvement in 2024.” In an email last February to Trendel, she described a particularly contentious meeting with residents. “While I was not invited to be there, several Shamrock staff there began texting me that I needed to come into the meeting as it was getting very intense. Picture me as Frankenstein's monster and the villagers lighting their torches.” Months later, at the semi-annual business meeting, an appeal by the residents’ association to remove Pugh received an extended standing ovation. Pugh, a Charlotte native, has been CEO since 2011. She was recruited 27 years ago as a marketing director by Raymond Hall, a United Methodist pastor who was Aldersgate’s president from 1984 to 2008. She later became health services director, then chief operating officer.
projects to diversify the business, including adding home health offerings. A management agreement effective in 2019 allowed ALPS to provide overhead services in return for 5% of Aldersgate’s net revenue. But ALPS’s operations always required more funding, and no system was established to monitor and manage additional funds from Aldersgate. The action plan stated, “ALPS does not have any assets therefore Aldersgate has little remedy.” Years of insufficient accounting also meant the consolidated entity lacked audited financial statements, which “appears to have been an element leading to the current financial disarray,” according to the Baker Tilly consulting firm in September. Aldersgate isn’t achieving best practices for spending on directcare staffing, dining services and maintenance, they noted. Last July, ALPS hired a new CFO, Cherie Grisso, the former CEO of Richfield Living, a Salem, Virginia-based senior housing community. It was acquired last summer by another Roanokearea institution after facing financial difficulties. An interim financial statement shows that through October, Aldersgate primarily used entrance fee proceeds to reduce its accounts payable and liquidated $490,226 in investments
RED FLAGS Aldersgate’s financial position worsened in the 2010s, with nearly $38 million in operating losses over the past decade. The pandemic had an impact, causing staffing shortages that prompted the board to approve higher wages for frontline employees, raising labor costs. Amid increasing problems at its flagship, Pugh and the organization’s board pursued
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to repay a portion of past-due entrance fees. According to regulators in January, the organization’s refund tab has risen from around $1.5 million to the $2 million-$2.5 million range due to recent resident attrition. The entire amount is due to former Aldersgate residents or their estates. “They are projecting that by the end of March or April they will be within a 60-to-90-day window of repaying people,” an insurance department spokesman says. “They are not expecting to get within 30 days any time soon.” Many steps in the corrective action plan remain incomplete. Crucially, management has failed to produce a full accounting of how the $7.5 million of revenue anticipation bonds and $3.4 million Aldersgate loan for the Generations project were spent. The state insurance department in September launched a “limited-scope examination” of all Generations expenditures and credit transactions between ALPS affiliates from 2020 to 2023. It’s expected to be completed early this year.
ALDERSGATE’S FUTURE Despite its financial woes, Aldersgate has strengths that might attract a buyer or enable a financial rebound. Occupancy remains a healthy 92%, or 489 of 532 units, beating the 90.5% sector average estimated by Ziegler Investment Banking. According to a report shared with bondholders, the $1.4 million operating loss during the third quarter was better than an expected $2.8 million loss. It helped that the organization raised its monthly service fees by 10% in 2023, which typically range from about $2,500 to $6,500. That didn’t please residents, many of whom contend that the service quality hasn’t improved. “Resident response to the situation ranges from disappointment to anger to fear that these large increases in fees threaten their ability to stay here, but so far, no momentum seems to be building for move-outs,” says the resident who requested anonymity.
Meanwhile, other CCRCs are expanding as the overall population ages and North Carolina attracts more retirees. Projects are underway at more than a dozen North Carolina institutions, including Mecklenburg County’s Sharon at South Park, Windsor Run, and Matthews Glen, according to state filings. Aldersgate’s key growth plan is spending more than $3 million in 2024 and 2025 to add eight cottages on vacant lots, pre-sold and built with entrance fees. Shelley says it’s also considering building independent living residences in infill sites near existing residential areas. Last fall, Aldersgate sold some property to ALPS for $1.5 million for a mixed-income housing project on Shamrock Drive. Charlotte-based Laurel Street Residential is the project's developer, backed by $16.5 million in housing revenue bonds approved by the Charlotte City Council. Construction is expected to start in the next few months. Aldersgate’s 2024 budget indicates some corporate restructuring is underway. The board is ending the ALPS management agreement and transitioning its employees and $2.5 million in leftover expenses to the “obligated group.” Shelley says trustees will consider remaining a single-site CCRC or affiliating with another organization. With the correction plan incomplete, the state will maintain supervision for the foreseeable future. Suspending Aldersgate’s license is unlikely. The department has said it prefers to work with the organization on fixes rather than issue fines, which would mostly serve to take money away from services for residents. Leadership remains optimistic. “From my perspective, Aldersgate remains a sought-after, faith-based, not-for-profit, welcoming CCRC on a one-of-a-kind campus,” says Tommy Lawing Jr., a Charlotte real estate executive who chairs the board. “Our leadership is focused on learning from the events of the last 18-24 months for the benefit of our seniors.”
About 570 residents live at Aldersgate. Entrance fees range from about $110,000 to $640,000 with monthly fees of about $2,500 to $6,500, comparable to other Mecklenburg senior living centers. F E B R U A R Y
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COMING TOGETHER By Kevin Ellis, David Mildenberg and Chris Roush
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elebrating diverse leaders in the state is a tradition at Business North Carolina, culminating in this year’s features on people from various racial and ethnic backgrounds from across the state. As in previous years, the list includes folks with widely different careers, ranging from a leading hotel-industry magnate to a small-town restaurateur. Many credit strong family influences for motivating their success. Each traveled a challenging path to achieve noteworthy success. The importance of diversity is an increasingly contentious issue after last year’s landmark Supreme Court ruling against race-conscious admissions at UNC Chapel Hill and mounting criticism of Diversity, Equity and Inclusion (DEI) programs at businesses, universities and other institutions. That tension doesn’t surprise Lucretia Berry, who is featured on Page 48. She teaches courses aimed at helping people understand racial issues and improve their communications with people of differing backgrounds. “It took a few hundred years until it became part of our culture where we could even discuss these issues,” she notes. “I’m optimistic, else I would quit.”
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iti Singh Armistead, the chief quality officer and chief clinical officer at ECU Health in Greenville, keeps making the right career choices. In college at George Mason University, she switched her major from engineering to physics and pre-medicine after she discovered that there were loans available to pay for medical school. “I appreciate what programmers do every day, but I realized that my own joy was working in the medical field,” she says. After graduating from the University of Maryland School of Medicine, she specialized in anesthesiology, thinking her physics background would be helpful. She switched to internal medicine because she found the long-term relationships with patients more enduring and satisfying. Now, at ECU Health, she’s focused on acute care and still sees patients on a regular basis. She took on administrative roles in 2018 and 2019 before the start of the COVID-19 pandemic, successfully helping steer the healthcare system during a challenging time. “None of us knew what we were in for,” says Armistead. “For me, it all just kind of came together. How do you support an already underserved population? How do you rise to the occasion as the only healthcare system east of I-95 with an academic arm to do it all, to build the infrastructure for the testing and to educate the community? Those were the kind of interventions I got to lead.” Armistead was 18 when her parents, Narendra and Asha, immigrated to the United States from India. She worked as a waitress and a cook at a Pizza Hut while in college. After medical school, she completed her internship, residence and a chief medical resident year in Richmond at Virginia Commonwealth University. Before joining ECU Health, she was the chief quality officer at West Virginia University Hospitals. ECU Health has 1,708 beds across an academic medical center with two campuses, and is a teaching hospital for the Brody School of Medicine at East Carolina University. It also operates eight community hospitals as well as outpatient facilities, home health, hospice and wellness centers in 110 locations. Armistead, who joined ECU in 2012, became senior medical director for quality in 2014 and director of the Teachers of Quality Academy at ECU’s Brody School of Medicine in 2016. She became chief medical officer in July 2018 and chief quality and safety officer a year later. “[The public] should have confidence that they’re going to get evidence-based care in a highly reliable way all the time.” Technology, she adds, is a big component, and the speed at which changes were made increased during COVID. Armistead says she’s a big believer in responding to data to drive improvements. Armistead and her dermatologist husband, Dr. Drury Armistead, have two daughters, Veda and Asha, who are in their 20s. She says being a parent has been just as important to her development as treating patients and holding administrative roles. “I find it the most fulfilling,” she says. “It’s allowed me to be a better leader and a better human.”
NITI SINGH ARMISTEAD CHIEF QUALITY OFFICER AND CHIEF CLINICAL OFFICER
ECU HEALTH GREENVILLE
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CHAUNCEY BARNHILL OPERATIONS DIRECTOR, SENIOR VICE PRESIDENT
WELLS FARGO CHARLOTTE
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ne of the first diverse employees Chauncey Barnhill hired at Wells Fargo was an autistic woman whose struggle with social interactions prompted her to eat lunch in the bathroom. That was more than 10 years ago. She still works for the bank, has been promoted several times, has lived on her own and now counts co-workers as friends. “Just the joy of seeing someone get a paycheck and the confidence that brings and how they stand a little taller and look you in the eye,” says Barnhill, a senior vice president in Charlotte. “That’s the biggest reward in the world to me.” The woman’s success also meant her father, a peer of Barnhill’s, could worry less about his daughter’s future. “He hugged me as a grown man, just thanking me for giving her an opportunity,” says Barnhill. “That moment just motivated me to want to do more in this space.” In his operations job, Barnhill oversees about 350 employees at four U.S. sites and 150 workers in the Philippines. His team processes about 260 million images, which include new-customer packets and loan applications, a year. Barnhill says he has hired more than 100 people who are either neurodivergent — meaning brain differences affect how their brain works — or those with mobility issues, sight or hearing impairment. While these employees may need some accommodations, he adds that all new employees need some help. Wells Fargo initiated its STRIDE program, which stands for Success Through Identifying Diverse Employees, in 2019. It has hired about 15 workers with a goal of them becoming full-time bank employees. Barnhill sees the program as an extension of his inclusive hiring approach. “Each year we want to employ more than we did the year before.” Expanding the potential workforce helps Wells Fargo by filling jobs in a tight labor market. Many workers hired by Barnhill often
have less absenteeism and fewer HR issues. He recalls a worker who rode two buses and a bicycle on his commute, often arriving 30 minutes early. “Having to overcome diversity just to get through day-to-day builds a certain set of resilience skills that translate well into the workforce,” says Barnhill. “There’s a desire to show they can do it, that they’re just as good if not better.” Barnhill knows how it feels to be different. Born with limited hearing in his left ear, Barnhill learned to position himself to be closer to classroom teachers. Early supervisors at Wells Fargo deemed him less engaged on job reviews, which Barnhill blames on being self-conscious about his disability and a difficulty to gauge the volume of his voice. He kept his hearing issue a secret at first, fearing it would hurt his advancement and not wanting preferential treatment. Over time, he felt comfortable speaking about his experiences. It also prompted teammates to disclose more. “My peers started saying, ‘I don’t have a disability, but my son or my daughter has a disability.’” Barnhill, who has an MBA from Liberty University, is on the boards of the Disability:IN North Carolina advocacy group and the N.C. Commission on Inclusion. “No matter what I’ve done as far as titles and things of that nature – the work that I’ve done in this space is what I will be most proud of,” he says. “It’s what I want my children to remember me for.”
LUCRETIA CARTER BERRY FOUNDER AND PRESIDENT
BROWNICITY CHARLOTTE
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ucretia Carter Berry has a life mission to promote racial justice and understanding, including helping both children and adults learn how to discuss complex issues that can divide rather than unite. She’s putting her skills to practice in a variety of ways. Since 2015, her consulting company, Brownicity, has offered training programs and educational materials for schools, nonprofits, businesses and more informal groups that want to promote unity and a sense of belonging. She also teaches an elective course, “Antiracism 101,” for senior high school students 48
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JESUS AND DIEGO RUIZ JESUS RUIZ, FOUNDER DIEGO RUIZ, MANAGING DIRECTOR
MI PUEBLO RESTAURANTS WINSTON-SALEM
ans of Mexican food in North Carolina have likely been influenced by the Ruiz family of WinstonSalem, which is marking its 35th year of operations this year. Mexican native Jesus Ruiz opened his first restaurant in the Twin City after working at diners in the Atlanta area. There are now 10 Mi Pueblo restaurants and about 400 employees in the state, mostly in the Triad and Charlotte areas. Ruiz has assisted many other Latino restaurateurs, making him one of “the
godfathers of Mexican restaurants in the Southeast,” notes his son Diego, who is managing director of the business. “My father’s ethos has been to do something better than the rest,” he adds. “It’s more than about the money for him. It’s more of a passion.” He points to the Mi Pueblo site in north Charlotte, where a $5 million investment a few years ago led to an 11,000-square-foot restaurant considered the chain’s crown jewel. A smaller, more efficient restaurant with fewer than the site’s 40 or 50 employees might have made better financial sense, Diego says. But the senior Ruiz “wanted a beautiful restaurant.” Mi Pueblo’s steady growth stems from attention to detail, the use of high-quality food ingredients, devoted staffers and shrewd business strategies, Diego Ruiz says. He credits his mother, Maria, for also being a pivotal part of the business. “No one can compete with the level of commitment we have.” The family has limited its use of debt while acquiring the real estate underlying each of its restaurants. Diego’s two siblings are also involved with the business. Diego, 33, is a graduate of Bishop McGuinness High School in Kernersville and UNC Chapel Hill. He started washing dishes on weekends at age 12 and was a relief restaurant manager as a teenager. He expects the business to grow with a new Mi Pueblo location in Mooresville that will likely have more of a “fast-casual” approach. A drive-through lane is planned. It is expected to open in 2024. Diego is also investing in franchised restaurants affiliated with the Dallas-based Pollo Campero chain, which features Guatemalanflavored chicken. He bought a Pollo Campero in Kenner, Louisiana, with plans to add more in coming years. “It’s the biggest risk I’ve taken in my life.” What won’t change, Ruiz insists, is the family’s focus on satisfying its guests.
at the Community School of Davidson, a public charter school in north Mecklenburg County. “The course helps students with a fundamental, practical understanding of the history of race,” she says. “Parents want to know how to raise and educate their children to talk about race.” Berry’s life experience has been a catalyst for her work. The Winston-Salem native earned a bachelor’s degree at South Carolina State University, a historically Black university in Orangeburg. She then earned a doctorate in educational curriculum and instruction at Iowa State University in Ames, where she met her husband, Nathan Berry, a tech industry manager who is Caucasian. The couple have three daughters. “Even before we got married, we had conscious conversations about race and ethnicity,” she says. “No matter where we lived, people found us to be a credible, judgment-free resource.” The Berrys moved back to North Carolina about 15 years
ago for job opportunities and a better climate. They launched Brownicity amid growing racial tensions across the United States, culminating in the 2020 police-involved death of George Floyd. “Systemic racism became a household word in 2020, and almost anybody could see themselves as an expert, which I think has caused a lot of harm to the movement in some ways,” Berry says. “But I’m optimistic, else I would quit. I continue to be asked to come into spaces to teach and share, and I know growth takes time.” Berry has published two books in recent years, including “Teaching for Justice and Belonging,” which she co-authored with Tehia Starker Glass, an education professor at UNC Charlotte. “If we study American history, there has always been resistance to efforts for racial justice,” she says. “I have the capacity to step back and see the strategies of that resistance. It is so important to give children the tools. We have to keep moving forward.”
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JAMES BOYD OWNER AND CHEF
THE FLAME CATERING AND BANQUET CENTER NEW BERN
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looding from Hurricane Florence in 2018 caused millions of dollars in property damage in Craven County and left residents reeling. In response, James Boyd used his two food trucks to feed hundreds of people for two weeks with food donated from area businesses. That’s how a “community guy” shows love for the residents of New Bern, he says. 50
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“In a small town, it’s about relationships,” says Boyd, who’s known as Chef Smoke. “If you build those relationships and make a difference in your community, then your community will make a difference for you.” Boyd took ownership of The Flame Steakhouse in New Bern more than 20 years ago after working several years for the former owner. Early on, he says he understood the need to support the community. He joined the Chamber of Commerce, gave to youth programs, provided meals once a week at the soup kitchen. “You can talk about it all day long, but you’ve got to show it,” he says. Boyd’s business became The Flame Catering and Banquet Center after he bought an adjacent, long-vacant bank building in 2008 and turned it into a 300-seat event venue. The conversion made it easier to manage costs, staffing and the ebb and flow of the restaurant business. Boyd also serves as executive chef and consultant at Captain Ratty’s, a decades-old seafood and steak restaurant in downtown New Bern. Veteran New Bern lawyer Buzzy Stubbs and his wife, Carol, bought the restaurant in 2021 and asked for Boyd’s help. The relationship was supposed to only last for a few months, but is entering its third year. The restaurant “is taking off like a rocket,” Boyd says. Boyd, who doesn’t have formal culinary training, got his introduction at a part-time job at the former Craven County Hospital (now CarolinaEast Medical Center) while attending New Bern High School. “I watched these older ladies in the kitchen do all their cooking from scratch and the smiles on the faces of the people who ate their meals, so that’s where the real love of cooking came from.” Boyd’s success may have never occurred had it not been for a conversation he had at another job. In 1992, he took a job at the Weyerhaeuser paper mill in Vanceboro for the good pay and benefits. “It was a great job, but it wasn’t creative enough for me,” he says. He worked there 11 years, mostly on overnight shifts so he could also work at The Flame during the day. He was operating a large machine on an overnight shift when an older colleague came by at 3 a.m. and asked what he was doing? “I’m doing my job? What do you mean, ‘What am I doing?’” was Boyd’s reply as he grew frustrated with the questioning. “Finally, he asked me, ‘Why are you out here chasing pennies when you got an opportunity to make dollars?’” says Boyd. “He said it’s never going to work unless you’re putting your all into it.” Boyd only slept about two hours after that talk as he kept doing the math in his head. The next day, he turned in his two week’s notice at the paper mill. That was 20 years ago, and Boyd had owned The Flame for about three years. “I was sitting on my dream instead of doing what I had a passion for, but I couldn’t see it at the time,” says Boyd. “I would have never known from that conversation that I would quit my job, but it was the best move I could ever make and I’ve never looked back. “I encourage anybody to this day, ‘Don’t be scared to jump. Don’t be afraid to put yourself out there.’”
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THADD JONES MANAGING PARTNER AND FOUNDER
NEXUS SEARCH PARTNERS CHARLOTTE
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ears spent helping large corporations hire executives also exposed gaps in the process for Thadd Jones, who thought he had a better way. Recruiters would bring in viable candidates but fail to consider the company’s leadership strengths or weaknesses. Other times, a recruiter pitched prospects Jones deemed “recycled candidates,” good people who floated to the top after being runner-up for an earlier position. “That list was not diverse,” he says. “That list looked like white men who had been contacted for years and had built up their networks for years. I started thinking, maybe my colleagues and peers are looking for something they also couldn’t find.” In early 2023, Jones launched his Charlotte Nexus Search Partners recruitment firm with five employees. Nexus specializes in helping companies develop talent with a focus on diversity. “I always knew I wanted to build a purpose-driven company that could really reimagine how executive-level hiring takes place,” he says. Jones grew up in Okolona, a small north Mississippi town. Jones played basketball for four years at historically Black Tennessee State University. His first job was as a recruiter for retailer Tractor Supply in Nashville, Tennessee, where his wife, Tiffani, was attending medical school. The couple later moved to New Orleans for her medical residency, then headed to Charlotte, where Dr. Jones is an OB-GYN with Novant Health. From 2014 to 2017 Jones worked at Mooresville-based Lowe’s as director of talent acquisition/inclusion and diversity, then spent four years at Amazon as head of talent acquisition and global diversity. During his tenure, the e-commerce giant added about 1 million employees globally. A business connection with Red Ventures co-founder Dan Feldstein prompted Jones to join the fast-growing digital marketer in 2021 as chief talent officer. He told CEO Ric Elias of his goal to stay two years, then start his own company.
“I don't know what MBA you can get that is better than working with someone [like Elias], who’s built a business from nothing into a multi-billion dollar business,” says Jones. In its first year, Nexus exceeded expectations by completing 10 executive searches, a process that typically takes about 75 days, Jones says. As of January, Nexus had seven searches under contract and is adding three staffers. “It’s scary. It’s not easy because you’re starting something with an idea, a thesis, but you have to prove it,” Jones says. One of the first clients for Nexus was Charlotte Pipe & Foundry, which was in search of a new chief human resources officer. Tim Clinkenbeard would fill that role for Charlotte Pipe in October. Says Charlotte Pipe CEO Hooper Hardison, "Nexus' dedication to thoroughly understanding our company's culture and industry was instrumental in helping Charlotte Pipe locate a top executive leader like Tim." In searches for higher-level executives, it’s important that both the candidate and the client “find out if the destination is really where they both want to be,” Jones says. Spending time with the company is key to understanding its personnel needs. “We bring them people who are qualified first, and who have diverse backgrounds, which makes that pool really rich,” says Jones. “We think we are onto something that’s unique in the industry.” Companies want leaders with different points of view, he adds. “If you are one homogenous way of leadership, it’s hard for you to have views that are going to allow you to think about customers who may look different than you over the next five, 20 or 30 years.” Jones wouldn’t share his company’s financial results. “Nexus is on a journey and that journey does not have a destination, an end point,” he says. “We have a deep commitment to giving back to the community and growing the next generation of great, diverse leaders.” F E B R U A R Y
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LINELL JOHNSON CHIEF FINANCIAL OFFICER
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hen Truliant Federal Credit Union Chief Financial Officer Linell Johnson was in high school, he noticed his father up late one night in the kitchen, studying. The next morning, Johnson asked his dad what he was doing. “I’m studying accounting,” his dad said. “I always wanted to do accounting.” Johnson’s dad never became an accountant, but the conversation stuck with his son. At the time, Johnson wanted to be an engineer, but at High Point University, where he graduated in 1998, he majored in accounting. “It’s been the best decision I ever made.” Johnson was named CFO of the Winston-Salem-based credit union in December after 18 months as senior vice president and controller. He succeeded Cosby Davis, who retired. Johnson now leads financial administration, accounting and budgeting, as well as oversight of electronic funds and payment processing, risk management and treasury. Johnson reports to CEO Todd Hall at the state’s second-largest credit union, with $5 billion in assets. He joined the credit union in 1994 when it was called AT&T Family Federal Credit Union and worked in accounting before becoming its first financial analyst in 1997. In that job, he developed organizational and profit systems and refined budgeting processes. Johnson left Truliant in September 2013 to become controller and then vice president of finance for Piedmont Advantage Credit Union, a local peer. When he left, Johnson met with Hall, who at the time was chief operating officer. Hall asked him to stay. “At the time I didn’t listen,” says Johnson. “But I watched.” He returned to Truliant in September 2015 as assistant controller and was promoted to vice president and controller in 2017. He led the credit union’s financial reporting, operational accounting, internal controls and financial policies.
Johnson, who is treasurer of Truliant’s political action committee, says he appreciates how Truliant’s management recognizes his work and focuses on families and communities. “I was able to come into Truliant and work my way through the organization,” he says. “If you work hard, you will get noticed.” Now, he says, his job is to provide an example to those who may be starting out at the company. “I’ve had a wonderful career here,” says Johnson. “I want to make sure that I can be a role model for others who want to be an accountant or CFO. Don’t sell yourself short. If you work hard and have great relationships and listen to those who are mentors to you, you can grow. I’m not just here on my own. I’ve had a lot of help.”
LIZETTE CRUIZ WATKO PRESIDENT, WATKO ENTERTAINMENT CARY
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n 1993 when Lizette Watko started North Carolina’s first Spanish-language newspaper, La Voz de Carolina (Carolina's Voice), she estimated there were fewer than 60,000 Latino residents in the state. Now, there are more than 1 million. While she sold the newspaper five years later, she’s made promoting Latino culture a big part of her life’s work throughout her career as a nonprofit leader. In 1998, she founded the Diamante Arts and Cultural Center in Raleigh to raise awareness 52
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PHOTO CREDIT: JONATHAN FREDIN/CARY MAGAZINE
FOUNDER, DIAMANTE ARTS & CULTURAL CENTER
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SHANA FULTON
hen Shana Fulton was a student at UNC Chapel Hill, she asked a political science professor, Jeffrey Obler, to write a letter of recommendation for graduate school. Obler said no. “I was shocked,” remembers Fulton, a Morehead Scholar. “I was about to pass out.” Instead, Obler told Fulton he would write her a letter of recommendation for law school, which she hadn’t considered. Fulton used that letter in her successful application to Columbia University in New York. Fulton now ranks as a leader in her field, having been included in “The Best Lawyers in America” in the commercial litigation section for the last four years. She’s also been featured in Business North Carolina’s “Legal Elite” in criminal law. Fulton says she gained her love of justice from her parents. Her father, Earnest, was a major in the Air Force and flew B-52s in the Vietnam War. Her mother, Phyllis, was a social worker. “Public
service has always been important,” she says. “Being a military brat contributed to that.” She grew up in Indiana, Idaho, England and West Germany. Fulton’s family moved to Garner from South Carolina when she was a sophomore in high school. At UNC, she graduated with highest honors in English and political science and was inducted into the Order of the Golden Fleece, the oldest and highest honorary at the university. At Columbia, she was a Harlan Fisk Stone Scholar and articles editor of the Columbia Human Rights Law Review. She also made it clear to her classmates she was “appalled and upset” over New York City’s version of barbecue. After graduation, Fulton worked for the Williams & Connolly law firm in Washington, D.C., handling criminal and civil litigation. She then spent more than a decade as an assistant U.S. attorney in Washington, handling criminal cases. Among her successful prosecutions were a 2015 murder in the Donovan Hotel and the “Double Hammer” homicide case, a love triangle gone bad. She was pregnant during the latter case. In early 2018, she and her husband, Tom Finigan, a real estate broker, moved back to North Carolina, where she joined the Brooks Pierce firm. “I think D.C. is an awesome place,” says Fulton. “But if you looked at my Facebook posts from then, I was all about what was going on in North Carolina. My heart has always been in this state.” Fulton specializes in white-collar cases as well as complex civil litigation. “I’m interested in justice, period,” she says. “There has to be just actions happening on both sides for the system to work properly. Everybody has to do their job right in a just manner that is fair to everybody. That philosophy hasn’t changed for me.” She also likes handling internal investigations for corporations and government entities. “It’s not only what went wrong, but how to possibly fix what went wrong and not let it happen again,” she says. “I could be talking at the board level and to leadership about corporate governance and responsibility.” Returning to North Carolina has been the right decision, Fulton says. “It’s not the same place that it was when I graduated from UNC in 1998,” she notes. “It’s such a fascinating and complex state. To be back here in the middle of this great hub of positive energy is really cool.”
of artists, cuisine, music and other facets of the community. Diamante, which means diamond in Spanish, continues to offer exhibits and provide leadership programs for aspiring artists. This year marked the 20th anniversary of the group’s Three Kings celebration on the 12th day of Christmas, which is a widely celebrated annual holiday throughout Latin America. The annual Ritmo Latino festival in May has attracted more than 12,000 people. “We consider every artist to be a small business, so we consider our work to be economic development,” she says. “People misunderstand that the arts drive everything in our community because a lot of STEM (science, technology, engineering and math) is based on art because someone has to design TVs, cars, newspapers, magazines. There’s an artist behind those designs.” Watko’s mother was Dominican while her father was from
Puerto Rico. Raised in Los Angeles, she and her husband, Eric, came to North Carolina when he enrolled at N.C. State University’s graduate school. He’s a telecommunication industry executive. Diamante, which has three part-time staffers, just moved into new leased space in west Raleigh. “If I had a wish, it would be for us to raise $1 million to create a center where we don’t need to spend money on a lease because the costs are astronomical,” she says. “But arts and culture aren’t supported as widely as they should be.” This year, Watko says she’s going to focus on reinvigorating her entertainment company, which has included event planning, blogs and podcasts. Building greater Latino participation in civic affairs is also a constant goal. “It takes time for people in the community to gain influence, particularly because many aren’t eligible to vote until they gain citizenship,” she says.
LAWYER, PARTNER
BROOKS PIERCE RALEIGH
PHOTO CREDIT: JONATHAN FREDIN/CARY MAGAZINE
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VIMAL KOLAPPA FOUNDER AND CEO
EAST COAST HOSPITALITY WASHINGTON, N.C.
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t his first meeting on the UNC Chapel Hill Board of Trustees late last year, someone asked Vimal Kolappa if he had attended the university. “No, but my heart beats UNC, UNC, UNC,” he responded, noting that he had undergone a heart valve surgery at UNC Hospitals. Kolappa is an unabashed promoter of the American dream. He emigrated to the United States at age 22 in the 1970s with $8 and an engineering degree from an Indian university. His goal was to earn an MBA at Roosevelt University in Chicago. After working for a suburban Chicago bank for five years and earning his green card, he moved to North Carolina. He spent more than a decade in the telecommunications industry before launching his hotel business. His first stake was a Comfort Inn in Havelock in Craven County. . East Coast Hospitality, the lodging company that he owns with his wife, Kalavathi, now controls 17 hotels with four more expected to open this year.
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Kolappa’s profile has risen because of his UNC appointment, but he’s also been a longtime director of the Economic Development Partnership of North Carolina, the state’s key industry recruiting organization. Former Gov. Pat McCrory made him one of the group’s initial directors in 2014, and he was later reappointed by the N.C. House of Rep. Speaker Tim Moore. He’s been a prolific bipartisan donor to N.C. politicians. “This is the greatest country in the world,” says Kolappa. “No other country offers the opportunity that allows you, with hard work, to make anything you want to make.” All of Kolappa’s hotels are in smaller cities in North Carolina like Goldsboro and Williamston, with the exception of a suburban Hampton Inn in Cincinnati. That’s by design because of the owner’s preference for less competitive markets. “The cost of operations is less, and hospitality is engrained in the people in rural North Carolina areas,” he says. “Our business is all about customer service because everybody has the same rooms. The difference is the people that work with you.” Kolappa also credits his company’s success to his experiences with the downside of corporate America during his nine years at Northern Telecom, the Canadian company that had a spectacular collapse starting in the early 2000s. He’d left his job there as a strategic pricing analyst in Durham several years earlier, having concluded his work was largely meaningless amid what he describes as a mismanaged multinational. So he started his hotel business, building gradually with limited debt. He was living in Beaufort County; his wife is a psychiatrist who has worked for Greenville-based ECU Health and other medical groups for many years. The Kolappas have lived in Chocowinity, population 720, for more than 20 years. Their two children are physicians and not part of the hotel business. Kolappa targeted towns near beaches and military bases, providing a steady source of visitors throughout the year. Half of his hotels have the Holiday Inn Express brand. He notes that he’s not a Patel, referring to the Indian family whose members are dominant forces in the U.S. lodging industry, though he has partnered with some over the years. East Coast now employs more than 400 people, including several managers who have had 20-year-plus tenures with the company, he says. “I urge them to run the hotels like it is your own business. I’m here to coach and help and I try to give them a lot of freedom. If the business does well, then I give them a very good bonus.” Kolappa’s confidence in his adopted state is shown in his plans to open new hotels this year in New Bern, Rockingham and Sanford. “If there’s a heaven on earth, it’s North Carolina.”
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KEN LEMON PRESIDENT, NATIONAL ASSOCIATION OF BLACK JOURNALISTS TV JOURNALIST, WSOC TV GASTONIA
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s a TV journalist, Ken Lemon often talks to people in crisis. Armed with a video camera, he approaches people who may have just lost their home or a loved one, been the victim of crime or facing accusations themselves. “You have to be honest with people and help them understand that I understand it’s the worst day of their life,” says Lemon, who works for WSOC TV, the ABC affiliate in Charlotte. “But you also tell them that I’d rather let people know what someone’s smile looked like rather than what their mangled car looks like.” Lemon celebrated his 25th year anniversary working for WSOC last year, married Kortni Alston, chair of the department of Communications, Art and Design at GardnerWebb University in Boiling Springs, and was elected president of the 4,000-member National Association of Black Journalists. Lemon says he campaigned for the position because he believes in “championing diversity in the media.” He wants to see diversity spread beyond just those on camera or whose bylines appear on stories, to those who make newsroom decisions. “The more Black people you have in journalism, the more stories you’re going to have from communities that are often overlooked,” says Lemon. “When you have diversity in your ranks, no matter what you are producing, studies show you tend to produce a better product.” Lemon’s first inkling of a journalism career began when he took an aptitude test at New Hanover High School in his native Wilmington. It suggested five career choices. “I can’t even remember what the other four jobs were, but TV reporter was one of them.” At UNC Wilmington, where he would serve as student body president, he had an internship with local radio station WFMD’s
news department. Radio was not his calling, but from that internship Lemon earned a job recommendation with WECT TV in Wilmington after he graduated in 1992. He started by editing video that TV news anchors read over the air. It was a low-profile job, one where the dress code allowed for jeans and a T-shirt. Co-workers razzed him because he often wore a shirt and tie. “I said, ‘One day I’m going to go into that manager’s office and I need him to see me as a reporter and not a news director,’” says Lemon. He had a reporter’s job within six months. At WSOC, Lemon has won an Edward R. Murrow award, one of the highest honors in TV journalism, for his coverage of a church fire in Ranlo in Gaston County. He has also won three Emmy awards for news coverage in addition to several honors from The Associated Press. He held several leadership roles with NABJ, an organization headquartered at the University of Maryland, before his election to president. He was a two-time president of the Charlotte Area Association of Black Journalists, an organization he helped reestablish in 2008. The Charlotte group last year awarded Lemon its Lifetime Achievement award. Also last year, U.S. Rep. Sheila Jackson Lee of Houston awarded him a congressional recognition for his work in media diversity. Lemon says his natural curiosity — questioning why something happened — has been one secret to his success in journalism. He considers it an honor when people allow him to tell their stories. Every day remains a challenge. “The minute you stop growing, there’s nothing left to do, and you become stale,” he says. After three decades, Lemon says, he still loves his job. “At the end of the day it’s an opportunity to elevate voices.”
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PAM CASHWELL SECRETARY
NORTH CAROLINA DEPARTMENT OF ADMINISTRATION RALEIGH
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rowing up in eastern North Carolina, Pam Cashwell spent summers picking cucumbers and toiling in tobacco fields at her grandmother’s Sampson County farm. “My parents made sure that my siblings and I knew what it was all about to work hard,” says Cashwell, who is secretary of the N.C. Department of Administration. Hot, sweaty summers in the fields also served as a motivator, she says. “I think that my parents’ objective was for us to know that we needed to get an education and make a better way, " says Cashwell, who went to high school in Fayetteville, then earned undergraduate and law degrees from UNC Chapel Hill. “It definitely created in me a strong work ethic.” Cashwell also credits her mother, Gertie Brewington, now 93 and living in Fayetteville, with inspiring her career in public service. As a teenager, Cashwell often tagged along with her mom, who worked for the North Carolina Commission of Indian Affairs, a division in the agency Cashwell now leads. Her mother went into mostly rural North Carolina communities to help establish food banks, literacy programs and other services. “Traveling with my mom, I was able to see the impact of one person going out into a community,” says Cashwell. Gov. Roy Cooper made Cashwell the first American Indian woman to head a state cabinet department in April 2021. She had previously held several state and federal government jobs, including stints with the N.C. Department of Public Safety, the U.S. Department of Agriculture and a U.S. Attorney’s Office in Virginia The 520-employee Department of Administration acts as a business manager for state government, with a focus on aiding underserved communities. Among many other things, it offers grants to curb domestic violence and support shelters for those who have been sexually assaulted. “When you can go into work every single day and know there’s
something you can do to make North Carolina a better place to work, live and raise a family, it’s hard to beat that.” Cashwell’s parents were born in the 1930s and as members of the Coharie and Lumbee tribes, they attended the East Carolina American Indian school in Sampson County. It was the only option for Indigenous kids in that area. “My mom had to travel from Fayetteville to Sampson County. It all worked out,” she says, noting that her parents met at the school Her father, Samuel Brewington, who died in 2013, was an independent truck driver and her mother owned a beauty salon and dress shop. Owning small businesses “was their way to avoid the kinds of discrimination they would have faced,” she says. “It was very difficult getting into the private sector in anything other than an entry-level job, so they started their own businesses and did very well.” Her mom would often work long days in the beauty salon, charging women $5 for a process that took hours to complete. A desire to have more time with her family pushed Cashwell to take a different career path. Cashwell and her husband live in Wake County. They have two sons, one in high school and the other in college. Her state post could end after the 2024 election cycle with the election of a new governor, but she hasn’t thought much about what’s next. “I’m sure God’s got a plan for me,” she says. “We will see.”
STELFANIE WILLIAMS VICE PRESIDENT FOR DURHAM AND COMMUNITY AFFAIRS
DUKE UNIVERSITY DURHAM
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telfanie Williams spent more than six years as president of Vance-Granville Community College before leaving in 2018 to join Duke University as vice president for community affairs. The decision allowed Williams to return to her alma mater, where she earned bachelor’s degrees in public policy and Spanish, and to change her career focus. “This role has been an opportunity to transfer my experiences from community colleges in many rural settings to a research university in an urban environment and to work with others collaboratively to address shared concerns and interests that support basic human needs and rights,” she says.
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arol Nguyen Steen has a personal reason to be involved in her community, whether that be serving with groups that help laid-off workers brush up on interviewing skills, people facing eviction or someone having difficulty navigating the healthcare system. Her parents, Nguyễn Văn Tĩnh and Nguyễn Thị Hiệp, came to the U.S. from Vietnam in 1975, the year the war ended there. Her father had fought against the North Vietnamese and would have gone to prison if he had stayed, Steen says. “When he and my mom came over with the first wave of refugees, there were companies that made a difference in their lives,” she adds. “That was a great opportunity for them to have. That gift was just instilled in myself and my brothers. “It’s a way for me to feel like I’m honoring my parents, by giving
back to a country that opened its doors to my family,” she added. Her parents, along with four aunts and uncles, worked for IBM in upstate New York before the company relocated the family to Charlotte in 1981, when the company opened its computer manufacturing plant. That was the year of Steen’s birth. A graduate of Charlotte's Independence High School, Steen has a bachelor’s degree from UNC Chapel Hill and an MBA from N.C. State University. After a decade in the Triangle, she followed her boyfriend, and now husband, Justin Steen, to Mars Hill in western North Carolina, where he was raised. They now live in Asheville with their 9-year-old twins. She is vice president of talent and human resources for the Cecil family’s Biltmore Farms development firm, which owns hotels, apartments and other commercial real estate property in Buncombe County. Justin Steen is an assistant prosecutor with the District Attorney’s Office. Her original move west was in 2009, and she says she felt a bit like a “trailing spouse,” even though she was not yet married. Steen says she missed her connections in the Triangle but found her in the Young Professionals group of the Asheville Chamber of Commerce. “I first got involved because I was trying to find a connection not being from here,” she says. Before joining Biltmore Farms, Steen worked in human resources for the city and Mountain Area Health Education Center. She’s active in many community groups, including an informal group of Asian Americans and Pacific Islanders, who held a series of events in Buncombe County in January involving food, traditional dress and customs. The group came together during the pandemic, when Asians reported more instances of violence and harassment nationally. Unlike her previous haunts, Asheville does not have a large Asian population. “Hate is what sort of brought us together and since that time there’s been more gatherings to celebrate our heritage and really being proud of who we are in a community that may not look like us,” she says. The community events held last month may be a “first step toward us serving as a community and displaying our positive cultural history.”
Williams started her second, five-year stint in her role in July. Williams helps Duke work on quality of life issues through education, healthcare, housing and employment initiatives. She works with Durham Public Schools, Durham Technical Community College and N.C. Central University, an historically Black institution. She also serves on the boards of many Durham civic groups and has been a director at the $50 billion State Employees’ Credit Union since 2017. Williams led Vance-Granville from 2012 to 2018, receiving the state community college system board’s award for “president of the year.” The college serves more than 8,000 students a year at campuses in Vance, Granville, Franklin and Warren counties in northeast North Carolina. She was the first woman and the first person of color to serve as president of the college, where nearly half of the students at the time were Black or Hispanic. “Being able to open doors for others is an important responsibility. It is something that I have done professionally,
and, as importantly, it is a personal disposition,” she says. Williams, who has a doctorate in adult and higher education from N.C. State University, continued to teach courses while at both Vance-Granville and Duke. “Teaching is a role that brings me tremendous joy, and I have learned as much from others as I ever taught,” she says. Williams was motivated to pursue education as a career by a family member who could not read. “This inspired my interest in literacy and education,” she says. “My family instilled in me a belief in the dignity of all humans.” Williams credits her parents with placing a high value on understanding the world “through eyes and voices other than one’s own.” She says that direction instilled in her the benefit of traveling globally, while appreciating the importance of local connections and community development. It also influenced her decision to earn a second bachelor’s degree in a foreign language, she says.
CAROL NGUYEN STEEN VICE PRESIDENT TALENT AND HUMAN RESOURCES
BILTMORE FARMS ASHEVILLE
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hanks to the efforts of a local electric membership cooperative, the North Carolina Zoo advanced its mission to contribute to a greener future when it acquired a revolutionary tractor. It’s not your granddaddy’s tractor. It’s electric. Last year, North Carolina’s Electric Cooperatives and Randolph Electric Membership Corp. reached out to the zoo to gauge interest in partnering with them in a yearlong pilot project to gather performance measurements with a goal of deploying electrified equipment on farms across the state. The project has been called the future of sustainable farming technology and the zoo is just the starting point. It is just one step toward the clean energy environment North Carolina envisions in the coming years.
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Through its partnership with the zoo, Randolph EMC will examine various usage data, including how much energy the tractor consumes, how often its battery needs to be charged, its overall performance, and the amount of money the tractor saves on fuel and maintenance costs. Michael Trent, vice president of member services and public relations at Randolph EMC, is the pioneer behind its electric vehicles and innovative energy programs. The idea for collaborating with the zoo was born out of the annual National Drive Electric Week, celebrated at the zoo. “The North Carolina Electric Cooperatives was searching for a place to experiment with an electric tractor in a real-world environment and measure both the environmental benefits and costs of operating it, and we thought the zoo would be a good fit,” Trent says.
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The Solectrac electric tractor is manufactured in California and distributed through a partnership with Nolan Manufacturing of Denton, North Carolina. Trent said the compact tractor cost $39,000 and the cost was split between the zoo and the NCEMC. Painted royal blue, it resembles a typical gas-powered tractor and will run for six to eight hours on a single charge. At the zoo, operators are using the Solectrac to shovel dirt, pick up mulch and perform other types of light landscaping chores. The Randolph EMC, founded in 1935 to bring electricity to rural communities in central North Carolina, is owned by its 32,000 members who live in parts of Randolph, Moore, Montgomery, Chatham and Alamance counties. It is one of the 26 electric
PHOTOS BY: RANDY BERGER PHOTOGRAPHY
As North Carolina marches toward a clean energy future, the local electric cooperatives are at the forefront of innovation.
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PHOTOS BY: RANDY BERGER PHOTOGRAPHY
Laura Trantham, an interior horticulture technician at the North Carolina Zoo, uses an electric tractor to add mulch to rows of trees in one of the zoo’s browse gardens. North Carolina’s Electric Cooperatives and Randolph Electric Membership Corp. partnered with the N.C. Zoo to support the new all-electric tractor introduction and the zoo’s EV charging stations. One key to meeting North Carolina’s electric vehicle goals is installing charging stations in key locations around the state.
cooperatives that are members of the North Carolina Electric Membership Corp. “We work with our local community and support them in innovation,” Trent says. “We are environmental stewards the local level and leaders across the nation.” The Randolph EMC will share the electric tractor’s data with other cooperatives and North Carolina at large. The zoo’s electric tractor project is The zoo’s electric tractor project is part of the NCEMC’s “Brighter Future Vision,” an initiative that incorporates more carbon-free sources of power generation with a goal of achieving a 50% reduction from 2005 carbon emission levels by 2030 and to be net zero by 2050. “We’re pro-active with our approach and our goals mirror the State of North
Carolina’s overall clean energy goals, and the way we get there is constantly evolving,” says Jim Musilek, vice president of innovation and business development strategic management at NCEMC. “Our Brighter Future Vision is our guiding principle, and our member cooperatives are nimble, innovative and mission driven.” If he’s optimistic about hitting the 2030 and 2050 goals, then he’s laser focused on keeping the grid reliable through innovation, keeping sustainability at the forefront. “We’ve done a lot of experimentation with the technology that’s driving our industry, and we want to be out in front of what’s coming,” Musilek says. “We’re also working closely with our local communities on these initiatives, because that’s really our core business.” The North Carolina Governor’s
Office is also looking down the road as it moves toward accomplishing the 2025 goals in Gov. Roy Cooper’s Executive Order 80: “North Carolina’s Commitment to Address Climate Change and Transition to a Clean Energy Economy.” The goals include reducing statewide greenhouse gas emissions to 40% below 2005 levels, increasing the number of registered, zero-emission vehicles (ZEVs) to at least 80,000, and reducing energy consumption per square foot in state-owned buildings by at least 40% from fiscal year 20022003 levels. Peter Ledford, North Carolina’s clean energy director, says the state will come close to meeting the goals, but the Department of Environmental Quality’s 2022 report projected two of them may fall short. “The report projected we were going to hit a 30% reduction in greenhouse emissions by 2025,” he says. “We’re expecting the 2023 report to be more optimistic, but I don’t know yet whether it’s going to project us getting to 40% statewide by 2025.” Further, the Utility Savings Initiative Report shows there had been a 33% reduction in energy consumption in state government buildings, including the UNC university system in 2022. That is 7% below the 2025 goal, Ledford says. He is more optimistic about hitting the targeted volume of 80,000 registered electric vehicles, which continues to expand, especially as the new VinFast electric car factory in Chatham County begins delivering cars in a few years. car manufacturing plant begins putting vehicles in the marketplace. Ledford predicts the state will make its zeroemission vehicle goal a year early. F E B R U A R Y
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“Between 2022 and 2023, we saw a 50% increase, and as of last October, we had 79,274 ZEVs registered,” he says. He attributes the growth to changing perceptions among consumers, and improvements in both vehicle technology and expansion of charging stations. “These are no longer niche vehicles with a limited range. They have become mainstream, capable of driving more than 300 miles on a charge,” he says. “And as we expand the charging infrastructure, the availability of fast chargers near highways, and community chargers for people without residential charging terminals, adoption of this technology is going to continue to increase.” By 2030, the goal is to have a million registered zero-emission vechiles in the state. There are now more than 3.2 million total registrations. “If we keep increasing by 50% year after year, my calculations show we will hit that target,” he says. Adding vehicle charging stations in rural parts of the state will also help put more electric vehicles on the road. Between 2009 and 2016, Volkswagen sold more than a half 60
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million diesel-engine vehicles with devices designed to avoid federal emissions tests. The company later agreed to a $14.7 billion settlement, with $2.7 billion designated for an independent mitigation trust that would be administered by local governments. North Carolina’s portion was $92 million. Musilek reported that in 2019 the EMC board of directors set aside $1 million dollars to install chargers around the state. “Between the funding we put in place and some of the Volkswagen settlement money, we have installed 100 chargers – a combination of the DC fast chargers and level two chargers in rural areas across the state,” he says. In addition to charging stations and the electric tractor project, the NCEMC is concentrating its efforts on the farms, businesses, and homes in the communities its members serve.Its member co-ops currently maintain 19 community solar farms around the state. The NCEMC is also developing microgrids for support and resiliency. Five microgrids are operational now. “Along with electric vehicles, resiliency is going to be one of our
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primary areas of focus,” Musilek says. “We have over 90 megawatts of substation batteries and as we move forward, we will continue to expand,” As the state marches toward its goal of attaining carbon neutrality by 2050, clean energy innovation, development, and deployment will be at the forefront. The NCEMC and its members are on board. “We are going to have to embrace new technologies, and it will be a continued evolution and continuous learning,” Musilek says. At the North Carolina Zoo, the collaboration with Randolph EMC is a natural fit. According to Musilek, the zoo has also worked closely with the local electric co-op on several other innovative projects, including deployment of other types of electric vehicles and charging stations. “We are thinking outside the box with many of the projects we are working on these days,” says Musilek. “Bringing new solutions like this to the communities we serve is all part of the cooperative difference we strive to make.” ■ — Teri Saylor is a freelance writer from Raleigh.
PHOTO BY: TERRY LOCKE
North Carolina’s first electric school bus serving the public school system arrived in Randolph County in 2023 and runs on power provided by Randolph Electric Membership Cooperative.
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Jeff Soplop
CUTTING THROUGH THE NOISE
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fter two decades in the energy sector, Jeff Soplop drew from his experience to launch Nimble Energy, a Pittsboro-based start-up that uses AI technology to optimize energy management. It was a concept that didn’t exist when he first embarked on his career. Nimble Energy is just what its name suggests, an energy management solution using artificial intelligence to deliver usage data in real time, enabling users to act quickly and manage energy consumption efficiently. A report by Ernst & Young calls AI “a game changer for renewable energy” because of its powerful prediction capabilities leading to improved demand, forecasting and asset management. Soplop cites shifting energy needs on both the supplier side and customer side which complicate management efforts. “Technology has delivered smart thermostats to conform to consumer behavior while suppliers are working to shift to renewable energy generation,” he says. “Balancing modern energy generation with consumer demand is becoming more complicated and expensive for both sides, especially when older buildings are in use and building managers are not up to speed on the latest energy technology.” Most building owners and operators for homes, businesses or industries have long relegated energy use to simple concepts like adjusting the thermostat for the hours a building wasn’t being used to save money. But wasted energy continues
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to be an issue. “Buildings waste tons of energy, yet most building operators lack the energy management resources and tools needed to reduce that waste,” Soplop says. He says that 30% of energy used in commercial buildings is squandered, which translates into $42 billion in energy wasted in the U.S. alone each year. Much of this loss can be attributed to operational issues. “Buildings are dynamic and many of the issues and areas of opportunity that arise in buildings come from problems such as equipment breakdowns, malfunctioning schedule issues, or a shift in occupancy behavior,” he says. “But there are always new technology options.” In the commercial and industrial world, energy management has typically been services oriented, relying on teams of data scientists, financial analysts, energy managers and engineers, Soplop says. But for many organizations, employing a large team is not financially possible, and managing energy usage can be a slow, plodding process for commercial and industrial buildings. The Nimble Energy platform acts like a virtual team for companies and organizations by allowing AI to do everything from evaluating facilities 24/7, to helping seek out opportunities for savings, evaluate new technology, crunch the numbers, generate economic models, and analyze the likely impact on energy use. “We’re taking a different approach,” C A R O L I N A
Soplop says. “It’s still data centric, but we leverage the best of AI analytics, as well as behavioral science methods to engage users and influence energy efficiency.” Nimble Energy also steps into a consulting role by helping companies set energy management goals, project performance, and build out budgets. The platform can also perform energy audits and implement projects, measure results, and determine whether clients are getting the performance they expected. “We’re also helping clear client barriers by matching them with financing options and helping them find incentive and rebate programs, because most buildings are eligible for dozens of incentives and rebates at the federal, state and local levels,” Soplop says. Nimble Energy launched in July 2023, and has so far attracted over a half dozen clients to its platform. Last October, Triangle-based Primordial Ventures added Nimble Energy to its 2023 portfolio. The platform is a software-as-a-service model and clients pay subscription fees based on the number of facility meters they have installed. The North Carolina company has a national reach and has its sights set on global opportunities. Soplop has devoted his career to working in climate tech. The James Madison University science and technology grad also has master’s degrees in economics from Duke University and Johns Hopkins University and a master’s degree in journalism and mass communications from UNC-Chapel Hill.
PHOTO CREDIT: JEFF SOPLOP
Artificial Intelligence is smoothing the path to efficient energy management.
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PHOTO CREDIT: JEFF SOPLOP
He previously held roles leading energy and software solutions at major corporations including Rockwell, ICF, and Brightly, and was drawn to the idea of applying behavioral science concepts to the way consumers manage energy, particularly in buildings. Nimble Energy looks to transform energy management in multi-site projects, like commercial building complexes, government and public buildings, utilities and K-12 schools. The company is also beginning to explore applications for industrial plants and individual buildings. “Based on my experience, I knew where the technology could have the fastest impacts,” Soplop says. “But I think as we scale, there could be a version of our solution that’s designed for single building owners and operators as well as leasing agents.” By working with a wide range of sectors, Soplop and his team can expand their solutions for organizations that have many assets to manage and generally thin teams with limited resources. For one thing, the building management workforce is undergoing a transformation as the boomer generation begins to phase out. “I think across that workforce, they’re expecting about 50% to retire in the next 10 years,” Soplop says “Plus, there is a huge demand for people with energy expertise who can do the work, and training is becoming important for those who want to enter this industry.” He touts the opportunities AI brings to the marketplace to augment and support teams in a new way by providing them with capabilities that they have not been able to afford before. “There are many different types of technology, programs and financing options in the marketplace, and AI can help managers examine the assets and resources they are responsible for and enable them to craft the best strategy for achieving their goals,” he says.“We’re cutting through the noise to find the signal, and with the ongoing energy transition, it’s extremely noisy right now. ■
— Teri Saylor is a freelance writer from Raleigh. F E B R U A R Y
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HOW UNC CHARLOTTE’S EPIC IS HELPING THE ENERGY INDUSTRY The Energy Production and Infrastructure Center at UNC Charlotte is working to help the energy industry find workers and create a sustainable future.
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he 12-year-old operation, housed in the Lee College of Engineering, has more than $22 million in external research funding, which it is primarily using to conduct studies with industry companies. And nearly 1,000 students have gone through its concentration. “Right now is the time to get into
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this career,” says executive director Mike Mazzola, who is also the Duke Energy distinguished chair in Power Engineering Systems. “The energy transformation — the energy decarbonization of the entire global economy — has got to happen in 30 years. That’s about the right sweet spot of a career. So getting into it right now
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is the best time.” In North Carolina, HB 951, which was signed by Gov. Roy Cooper in October 2021, requires the electrical power system to be carbon neutral, reliable and affordable, by 2050, and to cut power sector carbon emissions 70% by 2030. That means companies that are using coal to create electricity
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PHOTO CREDIT: UNC CHARLOTTE EPIC
will need to use more solar and wind power to create the energy needed for consumers and businesses. Mazzola says one of the most exciting research areas for future energy consumption is integrating the customer into the system. Smart thermometers in houses and buildings will be used, with the approval of the customer, to change energy consumption when the grid needs to adjust. That will mean social scientists, as well as engineers, will find jobs in the industry. “Some people are perfectly happy to put on a sweater or a robe,” says Mazzola, an electrical engineer by training. “But other people would rather have more control of their environment. Understanding those nuances is absolutely one of the hottest areas of research.” The Center also worked with more than 250 regional energy companies, including Duke Energy, Siemens and
Westinghouse. Many of them are mentoring students who are in EPIC’s certificate program. “That makes a big difference,” says Mazzola. “It gives students who most often don’t know what type of engineering they want to do a perspective. They see the jobs and the very articulate and motivated engineers who come to EPIC.” UNC Charlotte students can complete the certificate in all four engineering departments and the engineering technology program at the College of Engineering. The Center’s industry involvement is key to its success, says Mazzola. Energy executives comprise its board of advisors and oversee its strategy. “Why Charlotte?” asks Mazzola. “Charlotte is not just a regional center for the electrical power industry. It’s a national center.” ■
— Chris Roush is executive editor at Business North Carolina.
UNC Charlotte students can complete the energy concentration with an engineering major.
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SEEING GREEN Moore County, known for country living, charming small towns and a vibrant economy rooted in tourism and golf, now has a new moniker under its belt: Resilient.
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oore County’s reputation as a golf mecca will be on display again in June when Pinehurst No. 2 hosts the U.S. Open for the fourth time. The United States Golf Association has tagged Pinehurst Resort & Country Club as its anchor site, booking four more Opens there through 2047. The U.S. Women’s Open Championship will be played on Pinehurst No. 2 in 2029. The World Golf Hall of Fame is relocating from St. Augustine, Florida, and will open its new headquarters this spring in the new, 6-acre Golf House Pinehurst campus adjacent to the Pinehurst clubhouse, walking distance from the club’s courses and the Carolina Hotel.
“The exposure we will get from global TV coverage is great and will benefit our destination in the long run,” says Phil Werz, president and CEO of the Pinehurst-Southern Pines-Aberdeen Convention & Visitors Bureau, “but, with 250,000 people expected here that week, we ask that folks support our local businesses all over Moore County.” That quarter-million headcount, Werz says, includes 35,000 fans per day plus vendors, transportation workers, merchandise distributors, “and all the peripheral support a major event like this takes to operate.” The Open has 156 players entered. Ben Bridgers, general manager
of Pinehurst Resort, says May 27 is the last day No. 2 will be available for regular play. “We close down the 28th, per the USGA,” he says. “What’s going to happen is, a perimeter will be erected around the facility. They want to make sure nothing happens to it. The course prep already has been happening, and the maintenance team works closely with the USGA to get it compatible with what they want, to make sure we put our best foot forward. F E B R U A R Y
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Latitude Builders
“The world of golf will be upon us.” The countdown began Jan. 8, with a to-do list, to make the entire resort ready. “From an operations standpoint, we have a checklist,” Bridgers says, “a timeline where certain areas, like the driving range, will be closed then re-opened. The USGA is in town, so we work with them regularly. It’s a total team effort to make sure this goes off without a hitch.” The Hall of Fame has been in Florida since 1998. The Golf House will be one of only two USGA test centers worldwide that tests golf balls and clubs for conformance to the Rules of Golf. “There still is some construction, but it will be open in time,” Bridgers says. The Pinehurst-Southern PinesAberdeen CVB website displays a countdown marking the days, 68
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hours, minutes – and seconds – until the Open’s first tee shot, and offers a tourist-geared list of sites around town. Bridgers says guests are playing No. 2 to say they played where the Open will be held. He calculates more than 450,000 merchandise items will be sold that relate to the tournament. “More than a dozen counties from here to Raleigh to Lumberton and near Charlotte have a demand for hotel rooms and will have people staying an hour or more away,” Werz says. “Best rule of thumb: Get tickets and your room as soon as possible. “There is an air of anticipation and excitement among shop and restaurant owners. What we encourage people coming for the Open to do is to enjoy the golf, but when you leave the course, C A R O L I N A
be sure to explore the destination. Pinehurst is great, but there are shops and restaurants in Southern Pines, Aberdeen, Carthage, Vass, Cameron and other locales in Moore County that would love to see fans, too.” Bridgers added: “This is America’s championship, and it’s good that people get to see what we see, this little piece of heaven, every day. People will experience our Southern hospitality, see a champion crowned on Sunday, and tell the stories about all the players they saw. It’s quite the spectacle.”
ELSEWHERE Moore County’s 10 townships of 11 incorporated communities and seven other census areas display a quality of life that
PHOTOS COURTESY OF MOORE COUNTY ECONOMIC DEVELOPMENT PARTNERSHIP AND USGA
Natalie Hawkins (left) is president of Moore County Economic Development Partnership. USGA’s new Golf House Pinehurst is expected to open phase one in May, including its Hall of Fame exhibit.
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suitable for industrial development. “We applied to Golden Leaf and said we could use some help with some business park sites in the northern end of the county, particularly the Robbins area, and we have identified potential sites,” says Natalie Hawkins, president of the county’s Economic Development Partnership. “Robbins is a small town, and they probably are the most economically distressed community in Moore County, and that’s what we want to focus on. There’s a lot of opportunity in Robbins, with its proximity to the new Toyota battery plant (under construction) in Liberty and its access to Interstate 74. They have a new boutique hotel in Robbins and great little restaurants. It’s a good small-business environment.”
In Aberdeen, the Economic Development Partnership is developing Iron Horse Industrial Park, a 73-acre plot with rail access, natural gas and municipal water and sewer. “We can accommodate multiple users or one large user, and we think we can get about 400,000 square feet of space on the site,” Hawkins says. The project is expected to cost just under $2 million, according to an Economic Development Partnership report. “We’re going to start clearing the site in February and hope to have the road completed by the end of the year. We’ve had multiple companies express interest in various industries, like construction and textiles and food processing.” Moore’s healthcare access is expanding, as FirstHealth Moore
PHOTOS COURTESY OF MOORE COUNTY ECONOMIC DEVELOPMENT PARTNERSHIP AND USGA
leans on more than golf: They’re home to small manufacturing, a growing healthcare industry, strong community college program and are a welcome mat for small businesses and entrepreneurship. Grant money also is helping the county. The MacKenzie Scott Foundation donated $3.5 million in March 2022 toward a Sandhills Habitat for Humanity project on Keyser Street in Aberdeen, for home construction. The Duke Energy Foundation provided grants last November ranging from $500 to $5,000 to help 40 small businesses. And Golden Leaf, in 2022, provided $15,000 to Moore County Partners in Progress for a site identification program near the town of Robbins that would be
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Regional adds a health and wellness facility in Carthage this summer. Plans include relocating the Convenient Care Clinic in Whispering Pines to Carthage, where family medicine also will be offered. The Moore Regional network serves 15 counties with a staff of more than 2,700. Healthcare and social assistance is the county’s largest private industry sector, followed by accommodations and food services, and retail trade. The county’s biggest need, Hawkins says, is infrastructure. “With our projected population growth, we need water, sewer and transportation infrastructure. With the U.S. Open, the Department of Transportation is trying to fit all
its projects in between (2024 and 2029), and we have some big improvements planned,” she says. “And we need broadband expansion in the northern part of the county. That’s important to our residents, our businesses and our farmers.”
ENTREPRENEURSHIP & MILITARY PRESENCE Entrepreneurship, Hawkins says, is vital in a county where the population has increased by 6,000 residents since 2020. “Right now, we’re at 105,000 residents and we’re expected to reach 170,000 by 2050,” she says. “We were the seventh-fastest growing county in North Carolina last year.” What makes Moore’s economy work is to think big by thinking small.
“My organization just hosted an entrepreneurial summit, and we had 200 people there and 40 said they wanted to start their own business, and one has,” Hawkins says. “Moore County has a variety of smallbusiness environments, and that’s what makes our economy resilient during economic downturns. There are no big factories that are going to lay off hundreds of people at a time. We are in the top 7% nationally in resilient economies for communities of less than 50,000, and our future is bright for all the population that’s coming our way.” Part of that population is military, with Moore’s proximity to Fort Liberty. According to the Economic Development Partnership, Moore County businesses secured more than $19.8 million in Department of Defense contracts in 2021. And, 12% of the population that year had served in the armed forces. “The military is very important to our local economy, and we have a growing defense sector with defense industries and a lot of them started right here in Moore County,” Hawkins says.
Junction Hall is scheduled to open in 2025 in a historic building on Main Street in downtown Aberdeen, with local and regional cuisine and craft beverages downstairs and event space on its upper level.
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A November meeting with the Chamber of Commerce, Sandhills Community College and Moore County Schools was part of the planning process for a new Early College High School program. “Moore County is projected to continue to grow in terms of population and business. Having a trained workforce is central to this growth,” says Sandhills Community College President Dr. Alexander Stewart. “SCC and community
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leaders have also engaged with MyFutureNC to help focus our efforts in turning out the degrees and credentials our population will need to attract and retain business and ensure we have the workforce to meet demand.” Stewart says top fields include construction engineering, advanced manufacturing, automotive and hospitality management. “That’s just to name a few,” he says. “We are blessed to be in an area where people want to live and work. Many people think of the golf and resort industry, but we also have a highly trained military population and are situated in close proximity to the larger projects such as Toyota, VinFast and Wolfspeed.”
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The N.C. General Assembly has budgeted $25 million toward that Early College vocational and technical training initiative. “This is an excellent time to invest in Moore County’s ability to train the future workforce in the vocational trades,” Stewart says. “The demand is certainly there for people with these skills. We are currently working with the Moore County Schools to determine the scope of the curriculum, and this will drive decision-making for capital projects. “This will be a unique Early College High School because it will allow students to pursue a high school diploma while working on credentials and certificates as well as two-year degrees. In the
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vocational trades and applied sciences programs, many of these are ‘stackable credentials’ which can be earned and applied as a progression to a two-year degree. The partnership with the school system will be critical, and the project also will allow SCC to expand its capacity in these areas.” And, the area of golf. Sandhills Community College has a Greenkeepers Apprentice Program in partnership with the USGA. “The program is the only one of its kind in the nation and is targeted at credentials for the greenkeepers who are really the backbone of the golf course maintenance industry,” Stewart says. “We graduated our
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As part of N.C.’s Year of the Trail in 2023, Moore County hid 200 glass-blown pinecones, made by Starworks in Star, N.C., along its trails. Outdoor recreation generates $11.8 billion in annual revenue in North Carolina.
first class of 20 on Dec. 14, and a new cohort will begin in January. We believe this program has real potential to grow. It really fits a niche for community colleges, and the partnership demonstrates the commitment the USGA has to the advancement of turf grass science and our area.” Sandhills Community College has an enrollment of about 4,000. “Community colleges have never been as important as they are now. Sandhills offers a multitude of affordable pathways to goodpaying, in-demand jobs, as well as transfer opportunities to a four-year college,” Stewart says. “As the only institution of higher learning in Moore and Hoke counties, Sandhills Community College is truly an economic engine for growth.” “So we have three key clusters here – healthcare, the golf cluster and of course, the defense,” Hawkins says. “That is what we can focus on expanding, because those are our existing strengths. And we’re a good place to start a business, and we’re looking for people who want that. We have an environment where innovation and creativity can thrive and be successful.” — Kathy Blake is a writer from eastern North Carolina.
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PHOTO COURTESY OF PINEHURST-SOUTHERN PINES-ABERDEEN AREA CVB
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STILL SERVING
Moore County veterans become entrepreneurs, business owners.
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Carthage. The business employs several veterans. About 40% of its clientele are active or retired military. According to census data, the county had 166 veteranowned businesses in 2022. “Throughout this business project, we have encountered so many people, whether it was someone in fiber optics, a cable salesman, or a bookkeeper for an equipment company who wanted to tell Brad and I the stories about their family member in the military,” Halling says, “and we weren’t even open yet.”
BHAWK
“I try to tell people there are different threads to the whiskey story than just the transitioning vet,” Halling says. “There’s the husband-and-wife story. The North Carolina story, with our furniture from High Point. There’s the resilience story, the mental health story, the learning about spirits, raising money. It’s like a bookstore.” Retired Sgt. Maj. Brad Halling and retired Col. Jessica Halling have a combined 49 years of service in the U.S. Army. BHAWK is short for Brad Halling American Whiskey Ko. He was deployed to Honduras in 1983, served in the 10th Special Forces Group (Airborne) with focus on Poland and in 1987 in the Physical Security Support Element – Berlin, prior to the fall of the Berlin Wall, and in the 410th Special Forces
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Tyler Cook, left, owner and general contractor of Latitude Builders, and Josh Duplex, right, director of construction. Duplex is a Purple Heart recipient.
Detachment in Berlin. He later was deployed to Somalia and fought in the Battle of Mogadishu, depicted in the movie “Black Hawk Down,” and was wounded when a rocket-propelled grenade struck his helicopter. His left leg was amputated above the knee, but he remained on active duty through full Army retirement. Jessica Halling enlisted in 1991 as a Russian linguist and interrogator and saw active duty as an Army Judge Advocate General in 1998. She has been deployed to Iraq, Jordan, Turkey, Korea and elsewhere as senior legal adviser to seven senior military commanders and currently is general counsel to a Silicon Valley cybersecurity firm. Their business on Yadkin Road, she says, “is the culmination of four years and nine months of my husband and I, every single day, trying to take our vision of gratitude and bring it to life. The designs on the bottles are Brad’s
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rad and Jessica Halling enjoy visiting California’s Napa Valley. For about 10 years now, it’s been their peaceful place. “We fell in love with it and the intersection of agriculture, manufacturing and food-andbeverage. What more do you want,” Jessica Halling says. She and Brad, her husband, took a little Napa knowledge and brought it east, to Moore County, where they are co-owners of BHAWK Distillery, opening soon in Southern Pines. “In Moore County, the climate is perfect for aging whiskey, which has long been connected with the military culture,” she says. “George Washington issued whiskey to his troops. Here, outside of Fort Liberty, it seemed like the perfect way to translate that intersection of agriculture and manufacturing and beverage, in this place.” The Hallings are military veterans. Moore County has several defense industry companies – Spiritus Systems (tactical gear manufacturer), K2 Solutions (canine defense areas), American Growler (off-highway vehicles), Telum Protection Corp. (exercise support, training, special equipment) – but it also has veterans, who segue their ideas and determination into successful businesses. BHAWK is one of those. So is Latitude Builders, a luxury home and retail construction company with sites in Pinehurst, Southern Pines, Aberdeen, Whispering Pines and
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vision. We’re two people, working in concert with each other, sometimes leading and sometimes yielding, and through that partnership, this is what we’ve ended up with.” The business will have “a heart and a soul,” Brad says. The heart being the manufacturing facility, and the soul being the Gratitude Room. “This is where we’ll feature someone who has engaged in extraordinary service, either in uniform or public service,” Jessica Halling says. The Gratitude Room will be a museum-like tribute to its current honoree, with new whiskey batches labeled to recognize them. Products include Sergeant’s Valor, a Gratitude Tribute series, the first honoring the pilots and crew of Super 62, a helicopter struck in Mogadishu, Somalia, in 1993. The complex will have a bar and kitchen, patio area with music and an event space. The Hallings plan a Profiles of Extraordinary Service feature, with opportunities to be part of a discussion led by someone local, where guests can learn and interact. And they will have Founders Hall. “It’s going to tell our entrepreneurial journey, starting in March 2019, how we put together a business plan, how we raised the money, how we gained private investment,” Halling says. “We have one institutional investor, one entrepreneurial investor and we
participated in an eight-week intensive review of our plan that culminated at the Pentagon in McLean, Virginia. The story is, how hard it is (to start a business). It’s hard. But we are just two Army veterans, and if you have the determination and tenacity and the energy, you can do it.”
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Tyler Cook is CEO and founder of Latitude Builders. He graduated from East Carolina University in 2013 and worked in commercial and residential construction. In 2019, he and his wife Emily founded Latitude, which became Southern Pines’ turnkey custom builder that won Moore County Home of the Year and Best of the Pines. Veterans are part of their success story: Josh Duplex, their director of construction, received a Purple Heart from time served in Afghanistan. Project Manager Jamie Thomas, is retired from the Army, and their selections coordinator’s husband is deployed overseas. Cook says his work also includes constructing homes for injured military and that he sponsors several local fundraisers and charity events that benefit local veterans. “Our commitment goes beyond construction,” he says. “We build lasting relationships and treat our clients as part of our family.”
Some of Latitude Builders neighborhoods include Forest Creek, Fairwoods on 7, National #9, Mid South Club, Foxfire’s Grande Pines, Seven Lakes West and the Country Club of N.C., according to a company spokesperson. The Cooks estimate more than 100 homes have been built since the business’ inception in 2019, with a staff of 11. The current price range for their custom homes are $1 million-plus. He recently launched Longitude Planning Group, a landscaping architectural company. “We’re proud to be part of the fabric of Moore County, building custom homes that are as welcoming and genuine as the people who live in them,” he says. For the Hallings, that mission is the same, but different. “It was really important to create an environment where we could show and convey the true quality of the military veteran and their families, and for private citizens to feel welcome also,” Hallings says. “It’s important to us to be ambassadors to Southern Pines, to Moore County, and to convey through those images (in the building) the quality of the population we come from.” ■ — Kathy Blake is a writer from eastern North Carolina.
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BHAWK’s Jessica and Brad Halling, both proud veterans.
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PROJECTPLANS ››› Insights on the state’s growth
BIG AND SMALL
The state’s rural counties persist in a challenging pursuit for growth.
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few summers ago at a Greensboro resort, visitors filtered into a dining room where polished china and water goblets waited with a whipped feta with fermented plum sauce appetizer and bourbon and soy-marinated ahi tuna. They listened as state economic recruiters, local college administrators and elected officials spelled out the benefits of the Triad region. Today, Toyota is investing nearly $14 billion for a nearby battery plant. About the time of that luncheon, Matt Ward, 45, became director of the Mitchell County Economic Matt Ward Development Commission in the N.C. mountains. He sells stunning views, sparkling crisp air and an iconic 1907 courthouse. For this year’s commission budget, he conjured up the courage to include a first-time request for $20,000 in advertising, for the full year. That amount is not much more than twice the tab for the Toyota luncheon. North Carolina has vast resources, including a 5.2-millionmember workforce, the nation’s best community college system and substantial airports. But in economic development, it remains a state of haves and have-nots. In the last several years, development investment and attention has been dominated by mega-projects such as Toyota in Randolph County, VinFast and Wolfspeed in Chatham County, and Boom Supersonic in Greensboro. Eli Lilly says it is
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spending $1 billion and creating 600 jobs at a plant in Concord, near Charlotte. Each is close enough to draw on an urban region’s resources. In roughly the same period, two existing quartz mining companies in Mitchell County have said they will expand, totaling about $1 billion and hiring another 300 employees. They are filling a need for semiconductor chip manufacturing. But no substantial new industries have arrived. The county also received about $70 million in commitments for four major projects, in the public sector. Throughout the state, Tier One and Tier Two counties like Mitchell, mostly rural and relatively lagging in incomes and wealth, trail those such as Guilford and Chatham, which have megasites, usually 1,000 acres or more, vital to attracting major national and international companies like Toyota. That maldistribution concerns economic development troops at all levels. “Are our sites well distributed?” poses Chris Chung, president of the Economic Development Partnership of North Carolina. “No. It would be nice to have one or more in the west, or more in the east.“ In the east, assembling large sites sometimes runs into wetland and other regulations, or simply unbuildable soils. “Finding a thousand acres of land is a tall order if you go much west of Interstate 77,” says Chung. Economic developers do not blame geography entirely for the lopsided layout, however. “The building blocks are basically the same,” says Joanna Helms, director of economic development in Apex and president of the 900-member N.C. Economic Development
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Association. “However, a lot of Tier One counties simply lack community-wide infrastructure such as internet, broadband and an interstate highway system.” Adds Gary Lanier, economic director in Columbus County: “Sewer is the golden piece in economic development. It’s the big challenge in a lot of rural counties. Once you get outside of municipalities like, in our case, Whiteville, Tabor City or Chadbourn, it’s just not there.” He adds, “Nobody’s going to build a 200,000-square-foot building that employs 100 people with a giant septic tank out back.” A job force and ready-to-go buildings are also part of the equation. “The No. 1 item on site selectors’ list last year was a ready and able workforce,” Lanier says. “If you are a big employer that needs to fill 1,000 positions and you look at Columbus, you find we have only about 5,000 people even of employment age. You’re not going to look at a county with only 1,100 people unemployed. Charlotte might have 20,000, or Wake 16,000, so these rural counties have to go after those companies that need 50, 75 or 100.” Similarly, few Tier One counties can afford to build speculative buildings, an increasing requisite for relocations. “Eighty percent of the leases that come across our desk want existing buildings,” he adds. “We haven’t had one in five years now.” State leaders have recognized the hurdles facing smaller counties, and responded with such measures as the Rural Infrastructure Act and Building Reuse Program. These initiatives led to a $60,000 grant
to support Weldon Steel, creating about a dozen jobs in the Halifax County town by the same name, and $80,000 to improve the water system that helps prevent fires at a hotel in Dillsboro in mountainous Jackson County. The challenges may not block rural counties from sharing in North Carolina’s prosperity, but they require the areas to make adjustments. “In small rural counties, you have a better chance of recruiting small, traditional types of manufacturing companies that don’t require more highly trained workers, but still need water and sewer,” says the N.C. EDA’s Helms. “Urban sectors might have more luck with high-tech, life sciences and industries like that.” Before directing development in Apex, a fast-growing suburban enclave, Helms spent 18 years as economic director in Wayne County, largely rural. “It boils down to several things,” she says. “One is local leadership and whether it’s prepared to fund the water and sewer needed, and maybe even to buy land. Wayne did just that when I was there.” Another is getting existing industries on board, not always easy. Basics count too, just as in urban areas. Mitchell County’s Ward recently applied for a grant to promote additional housing, now in short supply. “If you don’t have rooftops, you might not get that restaurant or grocery store you want.”In the meantime, Ward says he might take a relocation prospect to a local restaurant in Bakersville, drive them along the Blue Ridge Parkway or house them at a Little Switzerland lodge. ”After all,” he says, “that’s who we are.” ■
Lilly is investing $1 billion in an injectables plant, creating 600 jobs in Concord. The site once housed a Philip Morris cigarette plant.
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