TAXING ISSUE SPECIAL REPORT: Columbia stands out for high taxes
Columbia levies $1,582 per bedroom on rental properties such as this private student housing proposed at 1011 Assembly St. But in Tallahassee, Fla., home of Florida State University, such a project would pay $465. Columbia’s new 50% tax credit for 10 years on large projects makes the investments more competitive. But many say permanent change is needed in Columbia’s tax structure.
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June 23 - July 6, 2014 • www.columbiabusinessreport.com
INSIDE Singapore tire maker to build in Chester County. Page 3. Capital Angels seeks 40 investors in startups. Page 4. Home building gets back to normal in Midlands. Page 11.
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“I HAVE ALWAYS WANTED TO OPEN MY OWN BUSINESS.” Andrew Johnson, owner/operator, Craft and Draft At Work, PAGE 19
Upfront:
Briefs, brights and business news
Gender diversity pays dividends But S.C. boardrooms lack it Nearly half of the publicly traded companies headquartered in South Carolina do not have any women on their boards of directors, according to a recent College of Charleston
study, “20% by 2020: Women on Boards.” That’s despite studies showing that boards with diversity show better financial performance.
The Payoff
Figures compare return on equity and income growth of companies with diverse boards to those without board diversity.
Return on equity
16%
One or more female board member
12%
No female board member
10%
No female board member
$
Many experts say diversity is important in corporate governance, for considering different points of view when voting on behalf of shareholders and employees.
S.C. vs. the Nation
The 2020 Women on Boards coalition of educators and business people across the country are working to increase the percentage of board seats held by women at public companies. Here are the current stats.
20.0%
16.6%
9.1%
Avg. net income growth
14%
One or more female board member
United States
South Carolina
SOURCE: Credit Suisse
Goal to hit by 2020 SOURCE: 2020 Women on Boards
In South Carolina boardrooms According to a recent College of Charleston study, “20% by 2020: Women on Boards,” 20 of the 43 public companies based in South Carolina have no female board members. Those companies are
“Winner” companies
• Blackbaud Inc. • Delta Apparel Inc. • Coastal Banking Co. Inc. • Denny’s Corp. • The Bank of South Carolina Corp. • Tidelands Bancshares Inc.
“Very close” companies • First Financial Holdings Inc. • First Community Corp. • Provident Community Bancshares
“Token” companies
• 3D Systems Corp. • Sonoco Products Co. • Benefitfocus Inc. • Palmetto Bancshares Inc. • Southern First Bancshares Inc. • Integrated Environmental Tech • Greer Bancshares Inc. • SCANA Corp. • Resolute Forest Products Inc. • First Citizens Bancorporation • Span-America Medical Systems • Independence Bancshares Inc. • Community First Bancorp. • Atlantic Bancshares Inc.
“Winner” >20% held by women “Very close” 11-19% board seats held by women
referred to as “Zero” companies in the study. The study breaks the companies down into four categories based on the number of women serving on boards: Winner; Very Close; Token; and Zero.
“Zero” companies
• AVX Corp. • World Acceptance Corp. • KEMET Corp. • Oconee Federal Financial Corp. • First South Bancorp Inc. • Southcoast Financial Corp. • Grand South Bancorporation Inc. • Palmetto Real Estate Trust • First Reliance Bancshares Inc. • Revolutions Medical Corp. • ScanSource Inc. • Regional Management Corp.
“Token” 1 board seat held by a woman “Zero” no board seats held by women
• Synalloy Corp. • Pernix Therapeutics Holdings • JPS Industries Inc. • Security Federal Corp. • Scio Diamond Technology Corp. • 4Cable TV International Inc. • Congaree Bancshares Inc. • First Capital Bancshares Inc.
SOURCE: Women on Boards study, College of Charleston
June 23 - July 6, 2014
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Executive Chairman Enki Tan (from right) spoke to the media with Gov. Nikki Haley and S.C. Secretary of Commerce Bobby Hitt.
Singaporean tire-maker to build Chester County plant Staff Report
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colanews@scbiznews.com
iti Tire, identified by the S.C. Department of Commerce as the world’s 10th-largest tire manufacturer, will build a $560 million manufacturing plant and create about 1,700 jobs in Chester County. The plant on I-77 EXECUTIVE at Richburg will be SUMMARY the Singapore comGiti, a family-owned pany’s first manucompany, plans to facturing venture in spend $560 million North America. and employ 1,700 Gov. Nikki people in a 1.8 Haley joined local million square foot officials in the June plant. 16 announcement, saying the project is “another huge win” for South Carolina. She described the state as the “nation’s tire capital.” S.C. Commerce Secretary Bobby Hitt said Giti will be the fifth original equipment tire manufacturer in the state, joining Michelin North America, Continental, Bridgestone and Trelleborg A.B. Michelin and Continental Tire the Americas are also headquartered in South Carolina. The plant will be the company’s ninth in its global system, which is concentrated mostly in China. Giti plans to create the 1,700 jobs over the next decade to meet growing demand for its tires in North America. Factors in picking Chester County included the area’s workforce and training opportunities through the technical college system, proximity to major transportation infrastructure, port facilities in Charleston and access to the growing Southeast market. Lei Huai Chin, managing director of Giti Tire Group, said the location offers an “extensive and efficient infrastructure network including interstate highways, rail, close proximity to airports and a major
metropolitan area to support the company’s needs and growth for many years to come.” Enki Tan, the company’s executive chairman, said “existing business and strong demand for Giti Tire’s passenger and light-truck tires in North America has made this significant investment in South Carolina possible.” The Chester County plant will make passenger and light truck tires for automotive manufacturers and replacement markets, the statement said. The 1.8 million-square-foot facility will include manufacturing and distribution operations. Tan said the construction schedule is in the “permits and approvals process,” and did not say exactly when the plant is expected to be operational. During the first phase of production, the plant will have a projected capacity of 5 million tires annually. Giti Tire plans to increase production capacity based on market demand. The company has been in the tire business since 1951. Brands include GT Radial, Primewell, Dextero and Runway tires. The SC Technical College System’s economic development division, known as readySC, will help with recruitment and training. Ryan Peterson, Wal-Mart Stores Inc.’s vice president of automotive, said the announcement represents a successful team effort to “bring jobs and manufacturing back to the U.S. We applaud Giti Tire and Gov. Haley, and we are excited to bring quality, affordable tires to our customers that will also help us meet our goal to spend an additional $250 billion on domestically manufactured products over 10 years.” Both Haley and Tan noted that WalMart’s U.S. manufacturing initiative played a role in bringing Giti to a decision to make tires in this country. Tan noted that Wal-Mart stores sell Giti tires. cr br
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June 23 - July 6, 2014
Capital Angels aims to enlist 40 members to invest in early-stage S.C. companies By James T. Hammond jhammond@scbiznews.com
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apital Angels, a professionally managed, membership-based group of angel investors in the Midlands, is well on its way to its goal of 40 members with resources to engage in high-risk, highEXECUTIVE return investing in SUMMARY startups. Capital Angels will Already, 25 provide a vehicle accredited invesfor active investors tors have committo make high-risk, ted to pay $2,000 a high-reward investyear to participate ments. in what amounts to an investment club. As members of Capital Angels, the investors will have opportunities to investment a minimum of $5,000 apiece into a pool that takes an equity stake in selected startups. Charlie Banks, managing director of Capital Angels, said the group will aim to invest a minimum of $100,000 pooled by members in a company that meets the group’s investment criteria, including compelling solutions to needs in a large and expanding market. “Our goal is to have an angel investor network across South Carolina,” Banks said. Participants in Capital Angels each make his or her own decision whether to invest in a company that has been screened by the directors of the group. Capital Angels is seeking to grow to at least 40 investors, and hopes to make its first investment in the next two months. Matt Dunbar, a director of Capital Angels, noted that under federal regulations, such investor groups are limited to high wealth individuals who can afford to lose their investments. But careful due diligence and some good luck can bring high rewards for some investors in startup companies. “Home runs need to
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The High Growth Small Business Job Creation Act of 2013 created a state tax credit on investments made in “qualifying businesses”: » less than five years old, headquartered in South Carolina with 25 or fewer employees and gross income below $2 million
» engaged in manufacturing, processing, warehousing, wholesaling, software development, IT services, R&D, and certain service-related facilities
» recognized as qualified by the South Carolina Secretary of State
The tax credit is 35% of the investment (of which up to 50% may be claimed in the year of investment), up to $100,000 in total credits in a single tax year per taxpayer. Unused credits may be carried forward for up to ten years. The credit is transferrable, and may be sold, exchanged or otherwise transferred, but only once.
make up for the companies that do not succeed,” Dunbar said. Dunbar brings to Columbia’s angel investor community his experience in UCAN, the Upstate angel investors group, which has invested $9.5 million in 33 companies. Two-thirds of the companies are in South Carolina, and 80% of the dollars invested are in the state as well. He estimates 120,000 households in South Carolina could be accredited for high-risk investment pools under federal guidelines. “If we could get 1% of that capital off the sidelines, that would be $57 million to invest in startups,” he said. He said the angel groups typically seek to invest $200,000 to $250,000 in a company selected as promising for investment. But a company needs $500,000 to $750,000 to show its viability, he said. The Capital Angels group is for members who want to be active investors, involved in the selection of companies in which to invest. For high-wealth individuals who prefer to be passive investors, Dunbar and his group are also setting up a professionally managed fund, Palmetto Angel 2014 Fund LP, through which
those investors can participate. The fund will require a minimum commitment of $25,000, with a three to four year deployment in the 10-year life of the fund. Paul Clark, also a general partner in the fund, said the goal is to offer a passive investment vehicle that co-invests in early stage companies with Capital Angels. “We expect to have $1 million in the fund soon, and the goal is a fund of $5 million,” Clark said. Typically, the fund would invest in five or six companies a year. The investments from the two funds would be pooled in order to guarantee the target company enough capital to succeed. “Our goal is to bring $500,000 of investments to the table,” Dunbar said. That pool of investments also can grow if angel networks elsewhere in the state decide to participate. Investors get an equity stake in the young company for their investment. Also, angel investors in South Carolina are eligible for the 35% angel investor tax credit. For more information about Capital Angels, visit its website: www. capitalangels.sc. cr br
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South Carolina angel investor tax credit
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June 23 - July 6, 2014
First Citizens to merge with N.C. cousin Staff Report
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colanews@scbiznews.com
t’s “business as usual” following the announcement that First Citizens BancShares Inc. of Raleigh and First Citizens Bancorporation Inc. of Columbia agreed to merge the S.C. institution into the larger North Carolina bank holding company. “We do not expect any immediate changes,” said Angela English, director of corporate communications at the Columbia-based bank company. “Associates are encouraged to continue to operation in a ‘business as usual’ environment.” First Citizens Bancorp. has assets of $8.5 billion with 176 offices in South Carolina and Georgia, while First Citizens BancShares Inc. has assets of $22.2 billion with 401 offices in 17 states. The combined bank will have assets of $30.7 billion, making it the largest familycontrolled bank in the United States, the companies said. Based on the closing price of First Citizens BancShares class A common stock and the last price of First Citizens BancShares class B common stock on June 10 when the merger was announced, the transaction is valued at between $636.9 million and $676.4 million. North Carolina’s Holding family has controlled the Raleigh-based bank for three generations, and family members directly or indirectly own more than 90% of the company’s voting shares, according to AmericanBanker.com. Frank Holding Jr., who’s expected to lead the merged company, has been president of the Raleigh-based bank since 2008. His father was president 1918-1957 and his brother Lewis was president 1957-2008. The family also owns controlling interests in Fuquay-Varina, N.C.-based Fidelity Bank, with assets of $1.38 billion; Mt. Olive-based Southern Bank & Trust, with assets of $1.23 billion; and Columbiabased First Citizens Bancorp. Based on financial results as of March 31, the combined company would have total deposits of $26.1 billion, loans of $18 billion, and more than 575 branches in 18 states and the District of Columbia. The merger will create the sixth-largest bank headquartered in the Southeast by asset size. First Citizens Bank and Trust, the bank subsidiary of First Citizens Bancorp., was the fourth-largest bank in South Carolina when ranked by deposit market share, according to the FDIC’s ranking last June 30. First Citizens had 165 offices across
Holding South Carolina, and reported $6.39 billion in deposits, or 9.33% of the total deposits in the state. The merger is expected to close in the fourth quarter of 2014, subject to regulatory approvals and the shareholder approval from both companies. A combined leadership team will make decisions about the company’s future structure, products and operations, English said. “The two banks have worked together in various capacities for years, and First Citizens Bank of North Carolina has provided data and item processing, and other IT services to our company in a vendorclient relationship since the mid-1990s,” English said. The leadership team also will make decisions about jobs and what type of structure the company will have in Columbia, which is the headquarters of the South Carolina institutions. “As far as jobs, management will evaluate the merged talent pool, resource allocations and business requirements to make those kinds of decisions,” English. Jim Apple, chairman and CEO of First Citizens Bancorp., and First Citizens Bank and Trust Co. Inc., plans to retire later this year. He will be available for consultation with the combined company for an extended period of time, the company said. “I have no hard and fast plans at this stage other than to spend time with family and to allow myself to enjoy a break in the action,” said Apple, who will be 62 years old in December. “I will continue to stay in touch with leaders in the community and in banking, as I value these longstanding relationships.” cr br
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June 23 - July 6, 2014
Stone would propel craft beer industry By Ashley Boncimino
aboncimino@scbiznews.com
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overed in intricate stone work and hidden behind a winding, boulderlined path under the San Diego sun, the country’s 10th largest craft brewery hides its size well. The sprawling EXECUTIVE complex is supSUMMARY ported by 30-foot rust colored beams Lexington, Greenand equally tall ville and Myrtle concrete walls, one Beach are seeking of which sports to attract Stone an etching of the Brewing’s proposed horned gargoyle on East Coast brewery. each of Stone Brewing Co.’s 32 craft beers. The brewery’s Escondido, Calif., headquarters includes an upscale bistro that can seat 425 people, 34,000 square feet of gardens, a retail store and a 50,000-square-foot brewery space that produced about 213,000 barrels of craft beer last year. A similar complex might be headed to South Carolina, where 23 breweries collectively produce about 47,000 barrels of beer annually now. Stone has plenty of suitors.
Lexington, Greenville and Myrtle Beach have made pitches for the brewery, and possibly others. South Carolina’s competitors for the brewery include the Pennsylvania cities of Allentown and Bethlehem, as well as Norfolk, Va.; Blount County, Tenn.; and Charlotte. “There’s a lot that goes with Stone coming here, like education and folks just finding out about craft beer,â€? said Coast Brewing Co. owner Jaime Tenny, who is also the founder of the SC Brewers Association. “If it’s not them, other breweries are looking to do the same things‌. People pay attention to that and look to that, and we’re hoping they rope in a new crowd of people that helps the whole scene.â€? Stone is growing quickly, with revenue climbing more than 30% during 2013 to $135 million, and the brewery is looking to expand further with an East Coast campus. The company has asked East Coast communities to submit reasons Stone should commit to their area. Stone’s $29 million investment would increase its brewing capacity by around 50% with the addition of a 130,000-square-foot brewing, packaging and distribution facility, according to a request for proposals the brewery opened for communities. Similar to its San Diego location, the new East Coast facil-
ity would draw hundreds of people a day from all corners of the country. While Stone would create 374 jobs, the impact of a brewery of its caliber far outweighs the measurable economic benefits, according to proponents. “It would enhance the state’s craft brewing industry and really get momentum going,� said Tom Davis, Thomas Creek Brewery co-owner, brewmaster and quality control officer. If Stone chose South Carolina, it would not only make a name for the state as a leader in craft brewing, but it would create more craft beer aficionados that would then be more likely to buy craft beer from other stores in the area, he said. Momentum in the state’s fledgling craft beer industry follows several regulatory changes and comes in the form of more and more breweries opening, with five opening in 2013 and three more opening so far this year for a total of 23. South Carolina breweries produced nearly 47,000 barrels of craft beer in 2013, a 33% jump from 2012 and a 71% increase from 2011. The state still ranks 35th in amount produced, however, and ranks 41st for the number of breweries per capita. Stone has See STONE, Page 7
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June 23 - July 6, 2014
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Top S.C. brewers
Here are the state’s top brewers, based on 2013 estimates by the Brewers Association, along with Stone’s plan for an East Coast brewery.
Brewery
Barrels produced
Stone’s East Coast plan Thomas Creek Brewery RJ Rockers Brewing Co. Westbrook Brewing Co. Palmetto Brewing Co. New South Brewing Co. Holy City Brewing STONE, continued from Page 6
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plans to ultimately brew 500,000 barrels a year on the East Coast. By comparison, neighboring North Carolina has around 86 breweries, or 1.3 per capita, ranking No. 22 nationally. The Palmetto State’s northern counterpart has also done quite well with breweries looking for an East Coast hub, garnering at least $200 million in investment by attracting second largest craft brewer Sierra Nevada, third largest craft brewer New Belgium and 24th largest brewery Oskar Blues for each brewery’s East Coast operations. “The South has typically lagged in almost every craft measure, and one of the reasons is regulatory,” said Brewers Association Economist Bart Watson. “These things become tap dependent… the combination of momentum and regulation have been key.” Snagging Stone for South Carolina would be the state’s first big fish when it comes to craft brewing. Part of the reason is that the state hasn’t been in the running until recently, when legislative changes made the state more attractive by eliminating production limits, allowing food service and permitting brewers to sell more beer for on-site consumption. The Stone Law, which was signed by Gov. Nikki Haley in early June, is just the latest in a string of beer law changes that lift limitations on craft brewers in the state. It started in 2007 when the Pop the Cap law raised the legal alcohol by volume for beer from 6.25% to 17.5%. Three years later, legislators passed a tasting law that allowed breweries to give out, at most, four 4-ounce tasters of beer, which was previously prohibited. Finally, South Carolina took another step just last year via the Pint Law, which lifted beer tasting limits to three pints per person per day. “By degrees, the industry is reaching acceptance as a legitimate economic driver, and the laws are reaching parity with other states,” said Timmons Pettigrew, author of Charleston Beer: A High-Gravity History
120,000 13,500 8,236 7,000 6,000 2,550 2,507
of Lowcountry Brewing. “It’s not perfect, but comparing where we are now with even four years ago is staggering.” Before the Stone Law, craft breweries couldn’t sell food alongside their beer, nor could they sell more than three pints of beer per customer per day. “This is one of the fastest bills that I’ve seen go through any arena, and it seemed to not get nearly as much resistance,” said Thomas Creek’s Davis. “The Pint Bill itself took three or four times longer to get through … that in itself speaks volumes about how far we’ve gone in a very short period of time.” While South Carolina may be in the running, Stone has yet to announce a public decision about its new location. “While we applaud the legislation in South Carolina and any like it, this necessary element is but one of many factored into our decision making laid out in our request for proposal,” said Stone Brewing Co. Public Relations Specialist Sabrina LoPiccolo in an emailed statement. Other factors include “completeness of response, advantageous operational expenses (e.g. labor, utilities, logistics, etc.), development challenges, availability/timing, unique attributes (e.g. redeveloped or historic properties, sustainable sites), creativity as well as a significant weighting on incentive/development packages available,” according to Stone’s RFP packet. Bend, Ore.-based Deschutes Brewery is another brewery that may be considering an East Coast expansion. Though Deschutes may not decide for several years, South Carolina’s legislation may impact the brewery’s interest in the state. “Previously, we had dismissed South Carolina, along with some other states, as options for an East Coast operation based, in part, on outdated laws that discourage components of our business model, and craft beer in general,” said Deschutes Brewery Founder and CEO Gary Fish in an emailed statement. “And, although this is just a start in South Carolina, this progress may cause us to take another look.” cr br
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June 23 - July 6, 2014
South Carolina breweries weigh opportunities, costs of new law by Ashley Boncimino
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ashleyb@scbiznews.com
hange takes time. So much time, in fact, that Spartanburg brewery RJ Rockers still retains a tasting system it had to use before the Pint Law made it unnecessary almost a year ago. That system poured 4-ounce samples, the limit EXECUTIVE before the Pint SUMMARY Law was enacted A new law lets to allow brewerbreweries sell more ies to sell 3 pints on site, but some per customer. The are leery of burden Pint Law was the of running a latest in a string of restaurant. changes begun in 2007 to the way the state regulates its breweries. Now, a beer law takes effect July 1, uncapping beer limitations as long as breweries sell food. S.C. breweries are adjusting again, looking for ways to build business under the new rules. “We’re just doing something low key,” said RJ Rockers co-owner John Bauknight, who said his brewery would continue to partner with neighboring restaurant Cribbs Kitchen rather than launching its own food service. “The restaurant piece is not really important to us right now.” Heralded as a catalyst for the craft brewing industry in South Carolina, the Stone Law was named for its purpose, to help lure Stone Brewing Co. Stone doesn’t just brew large quantities of beer. It sells beer on site at a restaurant and retail store that accommodate hundreds of patrons at a time who visit from all over. S.C. law previously didn’t allow that. Regardless of whether Stone comes here, existing S.C. brewers aren’t so sure space and cost limitation will allow them to take advantage of the new rules to expand with taprooms, restaurants and added beer sales. The law, which passed with near unanimous support in May, allows breweries to sell more than 3 pints per customer per day if the brewery has a food-service permit from the S.C. Department of Health and Environmental Control. “Right now it’s kind of a daunting task to think about,” said David Epstein, owner of Myrtle Beach-based microbrewery New South Brewing Co. “It’s just a matter of putting a kitchen in here, and the building is not really set up for that.” Dealing with a new regulatory body and piling on more fees and taxes are also concerns, said Epstein, who said he currently pays 13 different taxes annually. “When you start serving food, they
want to make sure you have all your t’s crossed and i’s dotted for safety,” he said. “It’s a great step for S.C. breweries, but maybe it’s more for breweries that are opening or moving here.” Without food service, breweries are still limited to selling 3 pints per customer. A DHEC-approved kitchen not only opens the doors for breweries to sell more of their own beer, but they could sell the beer and wine of other producers as well. As long as RJ Rockers, for example, has a DHEC permit to offer food from the neighboring restaurant and customers consume the food within the brewery, Bauknight says they can serve more than three pints of beer, offer guest taps and have a wine license. “You can go as small as you want to go or as big as you want to go,” Bauknight said. Brewpubs like Greenville’s Quest Brewing Co., which are licensed differently than breweries, can already sell more beer on site but are limited in the amount of beer they can produce, and they can’t distribute. Some brewpubs may want to switch licenses, increase production and begin distribution, said Quest Brewing co-owner Don Richardson. Doing so, though, would require them to add food service if they don’t already offer it or limit how much they sell. “If we’d known two years ago we would have this [law], we might have ended up changing our layout and plans,” said Richardson of Quest, which opened last year. Greenville-based Thomas Creek says the immediate impact of the new law may be minimal as well. “I don’t really foresee it making that huge of a difference on a day-to-day basis, honestly,” said Tom Davis, Thomas Creek Brewery owner and quality control officer. Davis said Thomas Creek plans on offering something simple, such as sandwiches and chips from a glass case. He said most people aren’t interested in more than three pints anyway. The larger effect may be on special events, at which people have prearranged designated drivers and cabs. “It does allow me to create a draw for more everyday business … If they want to stop by and have a sandwich and a beer, they don’t have to stop by two places to do that.” The law might eventually add a revenue stream for startup and microbreweries with limited distribution means, said RJ Rockers’s Bauknight. “It helps all the other craft breweries in the area and I really feel it helps the smaller breweries,” he said. “We’re very appreciative that Stone is looking at this state … but there’s a lot of other companies behind Stone that this might help.” cr br
June 23 - July 6, 2014
www.columbiabusinessreport.com 9
Employment and wages in Columbia, May 2013 Workers in the Columbia MSA had an average (mean) hourly wage of $19.41 in May 2013, 13% below the nationwide average of $22.33, according to the latest data from the U.S. Bureau of Labor Statistics.
MARKET
Sponsored by
FACTS
Occupational employment and wages by major occupational group, United States and the Columbia Metropolitan Statistical Area Percent of total employment
Mean hourly wage
Occupation
US
Columbia
US
Columbia
Management
4.9
4.6
53.15
45.13
Business and financial operations
5.0
5.0
34.14
27.24
Computer and mathematical
2.8
2.6
39.43
31.45
Architecture and engineering
1.8
1.7
38.51
34.38
Life, physical, and social science
0.9
0.5
33.37
26.75
Community and social services
1.4
1.6
21.50
18.99
Legal
0.8
1.1
47.89
32.79
Education, training and library
6.3
6.1
24.76
23.63
Arts, design, entertainment, sports, and media
1.3
0.9
26.72
19.66
Healthcare practitioner and technical
5.8
6.5
35.93
30.53
Healthcare support
3.0
2.9
13.61
12.29
Protective service
2.5
3.3
20.92
16.10
Food preparation and serving related
9.0
8.3
10.38
9.21
Building and grounds cleaning and maintenance
3.2
2.9
12.51
11.04
Personal care and service
3.0
2.3
11.88
10.87
Sales and related
10.6
10.6
18.37
15.38
Office and administrative support
16.2
18.3
16.78
15.67
Farming, fishing, and forestry
0.3
0.3
11.70
13.28
Construction and extraction
3.8
2.9
21.94
17.42
Installation, maintenance, and repair
3.9
4.3
21.35
20.04
Production
6.6
7.0
16.79
15.63
Transportation and material moving
6.8
6.3
16.28
14.77
10
www.columbiabusinessreport.com
June 23 - July 6, 2014
2 Charlotte companies heading to S.C. By Chuck Crumbo
T
ccrumbo@scbiznews.com
wo Charlotte-based companies plan to move corporate offices south of the border and into York County, S.C. Both LPL Financial, regarded as the largest EXECUTIVE independent broSUMMARY ker/dealer in the Two companies will be moving hundreds United States, and The Lash Group, of employees who a patient support work in Charlotte services company, locations to Fort announced June Mill, creating thou16 plans to consolisands of new jobs. date their operations and build new office buildings just off Interstate 77 in Fort Mill. Together, the companies’ investment could reach $240 million and mean 5,400 jobs to a bedroom community that’s becoming home to more company headquarters and corporate operations. LPL Financial and The Lash Group contributed to a historic day for economic development news in the Upstate, which involve the creation of 7,000 new jobs and the investment of up to $800
million along I-77. Earlier in the day, Giti Tire, identified by the S.C. Department of Commerce as the world’s 10th-largest tire manufacturer, said it plans to build a $560 million manufacturing plant and create about 1,700 jobs in Chester County. Both LPL Financial and The Lash Group will be located in an area called Kingsley Park, a development near the interchange of I-77 and S.C. 160 (exit 85) that includes space for corporate campuses, retail stores, hotels, restaurants, common areas and scenic walking trails. “I believe it will be the location of choice for Class A office space,” said Britt Blackwell, chairman of the York County Council. Although the companies will be moving hundreds of employees who work in Charlotte locations to Fort Mill, Blackwell said thousands of new jobs could be created by the investments. And it’s possible the new employees might prefer to live on the South Carolina side of the border, he said. “Once we have them here, we plan to keep them,” Blackwell said. The Lash Group said it will be consolidating its operations in a new 250,000-square-foot corporate headquarters. The $57.3 million investment in the
first phase is expected to reach $90 million as the firm grows and adds a second facility on the campus over time. Lash Group president Tracy Foster said that the company plans to employ 1,200 workers at the Fort Mill campus, which is expected to be ready in March 2016. And the company plans to double the workforce to some 2,400 employees over the next several years, Foster said. Moving to Fort Mill will allow the company to retain its current employees, who work at three different locations “seven miles up the road” in “Charlotte, Foster said. “The new campus will improve efficiency and integration of our teams by consolidating our operations into fewer buildings and providing a superior work environment for our associates, ultimately benefitting the patients we serve,” Foster said. She added that the company will keep a workforce of about 600 employees in its Charlotte office through 2019. The Lash Group, which has operations in California, Maryland, Pennsylvania and Texas, is a unit of Amerisource Bergen, a $100 billion global pharmaceutical resourcing company headquartered in Valley Forge, Pa. LPL Financial said it plans to invest at
least $150 million and create 3,000 jobs. The investment, which runs through 2022, aims to accommodate its growing customer service operations, the company said. LPL Financial currently employs more than 1,000 Charlotte-based employees in three buildings across West Charlotte. The Charlotte area has been designated by LPL Financial as its primary destination for job growth during the next five years, said Mark Casady, chairman and CEO of LPL Financial. Construction of the new LPL Financial corporate office will begin in 2015 with expected completion in the fall of 2016. “We plan to create a work environment that supports innovation, collaboration, and engagement-a space that promotes employees’ overall well-being and where they will feel proud and excited to come to work every day,” Casady said. The company will be hiring while the Fort Mill headquarters is under construction. LPL Financial and its affiliates have more than 3,000 employees with primary offices in Boston, Charlotte and San Diego. cr br
Reach Chuck Crumbo at 803-726-7542.
In Focus:
LIST Commercial Real Estate Firms, Page 17
Commercial and Residential Real Estate
Top Builders by Permits Pulled Single Family Attached/Detached Permits Through April 30
Columbia-based Mungo homes, the largest home builder in the Midlands, is currently building new homes in the Spring Park subdivision of Northeast Richland County in the price range from $123,900 to $222,900.
Home building gets back to normal in Midlands By Chuck Crumbo
B
ccrumbo@scbiznews.com
eing in a region dominated by state, local and federal government employment, the Midlands homebuilding industry had managed to stay on an even keel during the EXECUTIVE best and worst of SUMMARY times. However, the Building 1,000 average single-fam- Great Recession changed the calily homes generates 2,970 full-time jobs, culus as state, local and federal gov$162 million in ernment joined wages, $118 private industry million in business in having to lay off income and $111 workers. million in taxes. Lately, though, things have been picking up, said John Covert, president of the Home Builders Association of Greater Columbia and owner of Covert Homes. “I think right now we are experiencing a controlled, but steady recovery, but I do believe there is significant room for continued growth,” Covert said. “We are certainly seeing the beginning of a return to a normal market.” Steven Mungo, CEO of the Midlands
largest builder, Mungo Homes, said business is “OK.” “It’s certainly better than it was,” Mungo added, noting that low interest rates for mortgages make homeownership attractive to many buyers. However, wounds inflicted by the Great Recession such as a plunge in property values and uncertainty about the job market still are keeping some buyers on the sideline. While there are potential buyers who can make the monthly house payments, some can’t qualify for a mortgage under today’s stricter underwriting rules because they either don’t have enough money for a down payment or a high enough credit score. “The lending situation is still somewhat tenuous,” Covert said. “For wellqualified buyers, financing is readily available.” Mungo said he thinks there are buyers who could get a loan but are reluctant to try. “The media is always talking about stricter underwriting,” Mungo said. “And everybody hates rejection.” Property valuations also have made it harder to move into a new home, Covert said. Because of the recession there still are homes selling for less than what they were purchased for, Covert said.
“We have worked through most of those, but the continued leftovers of that market are still in the system as comparatives,” Covert said.
‘Time to buy’
Lower home values presents challenges to home builders who have to compete despite rising costs of materials and labor. Still, for the consumer “now is the time to buy,” said Joey Von Nessen, who does economic research for Resh Marketing. Von Nessen explained that as the housing market improves and demand grows, prices are bound to rise. During the past year, he said, the median price of new home sales has climbed in all of the state’s metro markets. For example, the median price of new homes in Columbia rose 5.4% to $195,000 in the first quarter compared with $185,000 for the first quarter of 2013, Von Nessen said. In Greenville, the median price rose 9.8% in the first quarter to $225,000 compared with $205,000 for the initial three months of 2013. The Charleston metro area recorded an increase of 16.7% in the first three months of 2014 to $245,000 See HOMEBUILDERS, Page 16
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2014 2013 Builder YTD YTD Mungo Homes.............160............... 223 Essex Homes...............113............... 138 Great Southern............109............... 132 D.R. Horton....................71................. 85 Crown............................70................. 60 McGuinn........................52................. 35 Fortress.........................44................. 29 Ryan Homes..................38................. 41 Holiday Builders.............24................. 34 C and C.........................20................. 14 Edge City.......................17................. 20 Hurricane.......................17................... 8 Wilson Parker................13................... 0 Americas Home.............10................... 2 Schumacher....................9................... 4 New Start........................5................... 0 Pineapple Homes.............5................... 2 Rex Thompson.................4................... 2 Blue Ribbon.....................3................... 4 Blythe..............................3................... 3 Randy Bock.....................3................... 0 Celtic Works....................3................... 1 Imperial...........................3................... 2 James Waters..................3................... 0 JD McCain.......................3................... 0
Building Permits by Area (Through March 2014) Lexington County 330 Richland County 233 City of Columbia 48 Kershaw County 36 Town of Lexington
16
Cayce 8
West Columbia 8
Next Issue’s Focus:
Statehouse Review
12
SPECIAL REPORT
www.columbiabusinessreport.com
June 23 - July 6, 2014
High property tax on business chills Columbia’s growth By Mike Fitts
I
Taxes per Bedroom for Student Housing Projects
colanews@scbiznews.com
n 2012, an investment group opened a private student housing project right across from Coastal Carolina University in Conway. Called Monarch 544, the project brought 440 beds to the growing campus area without expending the college’s capital. The investors then looked for sites in Columbia near the University of South Carolina to follow up on its success in the state, as they had around the country. But they quickly backed off and went elsewhere, according to experts in commercial real estate. The reason: Property taxes for the project they wanted to build in Columbia were much higher than what they were paying in Conway, or would pay in many other college towns. According to data compiled by CBRE real estate firm, the initial tax assessment for another investor’s project on the same Vista site was three times what Monarch 544 pays in Conway. Land in downtown Columbia is more expensive than in Conway, and the planned project for USC would welcome more residents. Still, the huge disparity highlights an issue that could be holding back growth here: property taxes in Columbia and Richland County are considered to be the highest of any South Carolina metro area for commercial development. One national survey even puts Columbia’s commercial taxes among the highest in the United States (see sidebar on page 13). David Lockwood, executive vice president for South Carolina at Colliers International real estate firm, said that potential commercial investors first look across the river to Lexington County or elsewhere in the Midlands. “You develop in Richland County and Columbia if you have to do it,” Lockwood said.
Even with the 50% tax credit for certain large residential projects, Columbia’s property tax remains one of the highest among cities surveyed by CBRE-Columbia.
$800
Columbia, Mo.
$791 $465
$425
San Antonio, Texas
$1,581
Tallahassee, Fla.
$568
Wilmington, NC
Columbia projects with tax credit
Columbia projects without tax credit
Source: CBRE-Columbia
Business license fees combine with property tax rates make Columbia an unappealing commercial investment, he said. “The layering of these tax components is extremely detrimental to growth in Richland County and the City of Columbia,” Lockwood said. John Darby, president and CEO of the Beach Co. in Charleston, said that his company found tax rates in Columbia to be the highest it has dealt with in the state. The Beach Co. developed the CanalSide project in the Vista along with numerous projects in the Lowcountry, and its latest development is in Greenville. Columbia’s tax rates could be a major factor in discouraging development here, Darby said. “It’s more than taxes, but taxes sure
could affect the profit of the investment,” he said. Do these tax rates scare away possible customers before representatives of the area even can talk about the benefits of the region or special incentives? Some in the commercial real estate field fear that they do. Leaders at CBRE Columbia, the commercial real estate firm that has helped close two deals to bring student housing to the Vista, point to some local sites that have sat vacant for years, including those involved in these deals. The former Heart of Columbia motel site is directly across Assembly from the Statehouse, for example, which should be prime real estate. But deals to put the site to some use have been tried for years only to fall apart, said Martin Moore, executive vice president at
CBRE. Columbia ought to do much better than it does, but it’s difficult to know how many potential investors don’t really explore Columbia as an option. “It’s hard to know when somebody doesn’t call,” Senior Managing Director Mary Winter Teaster said. Columbia Mayor Steve Benjamin concedes that some developers could be put off from considering Columbia by the tax rates, but he expects that most companies would explore incentives and other options to see if Columbia could be a good fit. “Most businesses are pretty savvy,” Benjamin said.
The state and local bind
What makes the property taxes for
New Student Housing Construction Projects in Columbia = No. of beds
Arnold site: Blossom at Huger 673 Investment: $40 million Developer: Park7 Group
Edwards site: 620 Blossom St. 818 Investment: $40 million Developer: Edwards Student Housing
Bernstein site: Assembly at Pendleton about 700 Investment $62 million Developer: Park7 Group
USC site: Park at Blossom about 880 in two phases Investment: $94 million Developer: Holder Properties and USC
Also featuring: ground-floor retail space Source: City of Columbia
SPECIAL REPORT
June 23 - July 6, 2014
www.columbiabusinessreport.com 13
Private student housing merited a break, backers say By Mike Fitts
T This student housing project proposed at Blossom and Huger Streets would benefit from the city’s 50% tax credit for certain residential properties.
commercial ventures in Columbia and Richland County so high? Start with S.C. law. South Carolina puts more of its tax burden on businesses than many other states, a situation the S.C. Chamber of Commerce has sought to change for years. The state chamber has campaigned to correct what it sees as an unfair shift of the tax burden that resulted from the passage of Act 388. That law exempted single-family homeowners from paying school districts’ operating costs on their primary residence. To the chamber, that means that businesses and multifamily residences pay too much of the tax burden. Municipalities also have restrictions on ways in which to raise revenue. Other revenue sources such as hospitality taxes come with limits on the uses of the revenue. “We have almost no tools,” Benjamin said. “That’s why we have to be creative.” Add to that state framework the special challenges of the Richland County economy. As Benjamin puts it, “It’s an interesting challenge.” Benjamin pointed to several workhorses of the city’s economy and how many of them do not contribute to the
property tax, at least not directly. He rattles off a list of the Midlands’ top employers: the Statehouse and state agencies, the colleges including USC and its dormitories and Fort Jackson. None of these organizations pay property tax on buildings they own. That leaves a significantly smaller chunk of the Richland County economy to provide all the local government funds that usually are paid for by property taxes. Many state capitals have similar issues, Benjamin notes, but Columbia’s mix of employers makes the challenge even more pronounced. “The tax base is not representative of a city of our size,” Benjamin said. To meet the challenge, Benjamin said, Columbia puts out a focused, combined effort. That includes individual attention to possible projects and teamwork on economic development. Benjamin notes with pride that Columbia officials have been directly involved in most of the economic development efforts that have brought new businesses and tenants to Main Street.
Use of Incentives
Overcoming the challenging tax rates See PROPERTY TAX, Page 14
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Columbia Stands Out in National Survey A study by the Lincoln Institute of Land Policy comparing effective tax rates across the country rated Columbia as the highest among 53 cities for industrial tax rate, with an effective tax rate of 3.496%, versus a national average of 1.424%. The survey assumed that 60% of the business assets were taxed as personal property. For urban apartment tax rates, Columbia was ranked 14th of the 53 cities, with an effective tax rate of 2.416% on a property valued at $600,000. The national average rate was 1.961%. Columbia also has the second-lowest property tax on a median home, in part because of exemptions. Combined, that gave Columbia the fourth-highest ratio of the 53 cities surveyed by the institute for the difference between its commercial and homeowner property tax rates.
colanews@scbiznews.com
paid a much lower property tax. Columbia was prepared to tax the properties at $1,582 per bedroom while a private project in Tallahassee, Fla., home of Florida State University, pays $465, and the Monarch 544 project in Conway, near Coastal Carolina University, pays $458. Even during the 10-year tax credit, the Columbia projects will pay $791 per bedroom, according to Johnson. The tax difference in Columbia would be difficult to pass along to tenants, according to David Lockwood, executive vice president for South Carolina at Colliers International real estate firm. The pricing of the market won’t allow it, if a city project’s competitors are charging less for housing in Richland or Lexington County. “High taxes hit these projects hard,” Lockwood said. “You can’t pass them on.”
he tax breaks given to three new private student housing projects in Columbia have broken a precedent. Others may be keen to follow, but elected officials say they will be careful in deciding which projects measure up. In the past, such tax benefits have been given in order to attract more traditional employers, such as manufacturers. Those advocating for the change argue that the size of these investments makes them deserve the tax credit – and that these projects will not come inside the city limits without them. The main reasons cited: high property tax rates and pricey city requirements, including parking structures. Real estate company CBRE Columbia represented the buyer, Manhattan-based ‘Truly Compelling’ Case Local elected officials, who had not Park 7 Group, for the first two projects to gain approval, and made the case to the approved such a tax break before, call city and county councils for the tax break. the case for these projects convincing. Together, the two projects will bring more “These numbers are truly compelling,” than 1,300 new beds to the city. In both said Columbia Mayor Steve Benjamin. “We would have lost hundreds of millions cases, approval was unanimous. of development if Leaders at CBRE we didn’t act deciColumbia reject sively.” the argument that The tax credit the projects would helps the comhave come to the High taxes hit these projects munity increase city without the tax downtown populacredit, which gives hard. You can’t pass them on. tion density, rather them a 50% tax than let population break for 10 years. DAVID LOCKWOOD, continue to sprawl There are too many Executive vice president for South Carolina into unincorpooptions outside at Colliers International real estate firm rated areas. These the city to build in, student populations and too many cities competing to attract this capital, accord- will continue to add to the economic vigor ing to Martin Moore, executive vice presi- of the downtown area, Benjamin believes. The two projects on the Arnold and dent. Columbia requires these projects to Bernstein sites will pay more than $1 milbuild their own parking garages and to lion in annual property taxes, even after build to the city’s standards for vertical the 50% tax credit, according to CBRE development, Moore said. Going outside estimates. That includes about $640,000 the city limits has allowed developers to for Richland One schools, from tenants use less expensive land and surface park- who will enroll few if any children in the ing and to build lower-rise units, as have system, Moore of CBRE notes. “It’s still a huge win for the people of proliferated in the Bluff Road area. Building outside the city limits also Columbia,” Benjamin said. Kelvin Washington of Richland Counmeans not paying the city’s allotment of property tax. Moore and CBRE Research ty Council said it was a challenge at first to Director Ben Johnson maintain that the see the housing projects as eligible. He said taxes on the proposed student housing he became convinced that it was worth projects would have been prohibitive doing because the tax credit ends after 10 without the tax credit. Without it, Moore years and because of the continuing need said, the two projects and their $100 mil- to add assets to the county’s tax rolls. Without the tax break, the county lion total investment would go elsewhere. “You have a major impact on the com- would have added nothing to its tax rolls, munity that you wouldn’t have otherwise,” County Council Member Greg Pearce decided. Giving the tax break was better Moore said. A survey of other student housing projSee STUDENT HOUSING, Page 14 ➤ ects in comparable cities finds that most
14
www.columbiabusinessreport.com
SPECIAL REPORT PROPERTY TAX, continued from Page 14
June 23 - July 6, 2014
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also involves the use of incentives. Benjamin notes that can mean the major tax incentives that often are part of economic development, but also smaller efforts, too. For Main Street, that has meant using a special fund for property owners to improve the building facades or working to provide solutions for parking using city facilities. This was used for the Hub at Columbia student housing project in the former SCANA space, resolving the thorny issue of parking for several hundred new downtown residents. Burnie Maybank, economic development attorney at Nexsen Pruet and former director of the S.C. Department of Revenue, notes that county councils have the power in South Carolina to change their property tax codes as they see fit to land a particular project. Maybank remembers working with one S.C. county to land a high-tech target. The county cut its tax assessment on data servers to match what a rival in another area was offering and landed the project. Both Benjamin and Richland County Council Member Kelvin Washington wonder if the current tax incentives serve Columbia and other urban areas well. Washington, a member of county council’s economic development committee, believes the economy has changed from the old, factory-centered view and that incentives have not kept up. “We have to change the model,� Washington said. Washington said over years he has grown weary of companies that receive a property tax incentive lasting several years coming back at the expiration to seek an extension. When do these deals STUDENT HOUSING, continued from Page 14
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than “to get 0% of zero,� Pearce said. Both Pearce and Washington cited the example of the project that Holder Properties has launched with USC to build office and student housing on land near the old Carolina Coliseum. The project will create more than 750 beds and spend more than $90 million over its two phases. And the county will garner no property taxes from the project, the two men said, as the land will continue to belong to the university, even as Holder builds and maintains it. Holder Properties declined to comment for this article. While the 50% property tax credit is new, Moore at CBRE argues that some kind of tax or other incentive has been at work in many local projects. New tenants moving in this August at the Hub on Main Street, for instance, will park in a city garage, instead of the owners having to build (and pay property taxes) on one of their own. Other downtown projects have used Bailey Bill redevelopment tax benefits or other economic development bonuses.
actually pay off for local governments, Washington wonders. Benjamin also believes that local governments need better options from the state on incentives and revenue. “I’d like the Legislature to recognize the face that the metropolitan economies are driving the growth in the state,� Benjamin said. In the nearer term, Benjamin anticipates that the property tax burden on businesses will improve. He notes that voters approved new school bonds in recent years in Richland 1, Richland 2 and Lexington-Richland District 5. Those bonds moving off the tax rolls in the years ahead will provide some relief. There also would be tax benefits if the city and Richland County can consolidate some functions, he said. It’s an idea that has existed locally for years but has not come to pass yet. In the longer term, Benjamin and others say that they are seeking to increase private business growth in Columbia, in part because growing the tax base with new investment would spread the burden around better. Benjamin has cited the need for growth as a reason for his support of the tax credits given to two new student housing projects and for the public expenditures being used in the Bull Street project. Bob Hughes, lead developer of the Bull Street project, said that the project’s success would give Columbia a more diverse and vibrant economy with more visitors, and would add greatly to the tax base, which would provide some property tax relief. “It solves a number of problems,� Hughes said. cr br
Going Forward
Now that the precedent has been set on this issue, local government leaders know that other developers are interesting in benefitting, too. “There is a significant amount of interest,� Benjamin said. City council has been specific about what will deserve a credit, Benjamin said. To be eligible, projects will need to be designated as a student housing project and have an investment of $40 million or more, with a minimum tax bill of $750,000 per year before all credits are taken into account. Washington, too, knows that others will be interested. He emphasizes that the usual tax benefits don’t seem to fit the kind of growth that is possible in the city limits, citing the continuing discussion about a tax break for discount retailer Costco, which he supports. Traditional metrics about the size or potential jobs of a project seem outdated and inadequate, Washington said. Only similarly big investments will deserve consideration for a similar tax credit to the student housing projects, Washington said. “We’re going to take them case by case.� cr br
June 23 - July 6, 2014
IN FOCUS: COMMERCIAL AND RESIDENTIAL REAL ESTATE
The former AgFirst building has been sold, and the buyer, Memphis, Tenn.-based developer Heritage Land & Development, plans to redevelop it as a mixed-use structure with about 100 luxury residences. (Photo/Chuck Crumbo)
Developer plans ‘luxury’ residences for AgFirst building Staff Report
T
colanews@scbiznews.com
he new owner of the former AgFirst building said it plans to build more than 100 luxury residential units in the 118,000-square-foot structure. Construction EXECUTIVE will begin in fall SUMMARY to transform the building into a Construction will mixed-use facility begin in fall to with office space transform the in addition to the 118,000-squareresidences, accordfoot former Federal ing to Memphis, Land Bank building Tenn.-based develinto a mixed-use oper Heritage Land facility with office & Development. space and 100 More details of luxury residential the project will be units. disclosed at a news conference set for 10:30 a.m., Wednesday, at the former AgFirst building, 1401 Hampton St., the developer said. In spring, Heritage had acquired the building, which until recently was occupied by AgFirst Farm Credit Bank. The developer also is seeking landmark status for the structure. The request is cycling through City Hall. The city Planning Commission and the Design Development Review Com-
mission have approved the measure. The request now heads to City Council for its approval. Receiving landmark status would allow the developer to apply for a variety of tax credits offered by city and county government. The AgFirst parcel includes two buildings constructed in 1924 and 1935 and makes up one of 12 district offices of the Federal Land Bank System nationwide. In spring, AgFirst moved 380 employees to the Bank of America Plaza, 1901 Main St. The firm located its information technology staff in a second structure nearby on Calhoun Street. Columbia Mayor Steve Benjamin and Heritage Principal William M. Yandell III will discuss construction plans and the development’s importance for the ongoing revitalization of downtown Columbia’s urban core. Heritage develops real estate projects with an emphasis on historically significant structures that can be renovated. Most recently, Heritage has rehabilitated the historic Cotton Council Building in Memphis and the First National Bank Building in Tuscaloosa, Ala. In Tuscaloosa, Heritage invested $15 million in converting the top eight floors of the 10-story tower into 100 one- and two-bedroom apartments. The Memphis project involved converting a 36,000-square-foot building into 142 apartments. cr br
www.columbiabusinessreport.com 15
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IN FOCUS: COMMERCIAL AND RESIDENTIAL REAL ESTATE
Snapshot of Greater Columbia
HOMEBUILDERS, continued from Page 11
MF Permit Change from 2012 ............................................ down 50.80%
Staying competitive
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compared with $210,000 for the first quarter of 2013, Von Nessen added. “Delaying a purchase of a house Here’s a look at economic and housing stawill be disadvantageous,” Von Nessen tistics compiled by the National Association said. “All signs point toward a continof Home Builders for the Columbia area, which includes Fairfield, Kershaw, Lexington, ued increase in economic activity. This means the buyers’ market is ending and Newberry and Richland counties: that consumers will be better off purPopulation..................................... 793,742 chasing a home today than they will be one year from now.” Population rank...................................... 84 Pricing of new homes in the Columbia market is gear toward the salaries of Owner-Occupied Housing Units..... 200,912 state and federal workers, Mungo said. Statistics compiled by the home buildOwner-Occupied Housing Units Rank....... 7 ers association show that 85% of the Homeownership Rate ...................... 67.6% 839 new homes that were on the marHomeowner Vacancy Rate.................. 2.7% ket at the end of April sold for between $100,000 and $299,999. Percent Single-Family Detached....... 85.4% Nearly half – 48% – of the homes fell in the $100,000 to $199,999 category, Median Home Value..................... $138,700 while 35% of the new homes were priced Median Income of Home Owners .... $62,000 between $200,000 and $299,999, according to the report. Percent Built 2000 or Later.............. 26.4% Just 17 homes – or 2% – of new singleSingle Family Permits 2013............... 3,229 family units were listed for more than $500,000. SF Permit Percent Change from 2012 “We just don’t have a bunch of bankers ............................................ down 14.70% in high-rises that make $800,000 a year,” Multi Family Permits 2013 .................. 462 Mungo said of the Columbia market. Robert Dietz, economist for the National Association of Home Builders,
said expansion of the home building and remodeling industry has direct economic benefits. “Housing provides the momentum behind an economic recovery because home building and associated businesses employ such a wide range of workers,” Dietz said. Growth in housing employment ripples through the economy, the national trade group added. “About half the jobs created by building new homes are in construction,” the association said. “They include framers, electricians, plumbers and carpenters. Other jobs are spread over other sectors of the economy, including manufacturing, retail, wholesale and business services.” An analysis new construction employment shows that building 1,000 average single-family homes generates: • 2,970 full-time jobs. • $162 million in wages. • $118 million in business income. • $111 million in taxes and revenue for state, local and federal governments. Similarly, construction of 1,000 rental apartments, including units developed under the Low Income Housing Tax Credit, generates 1,130 jobs while $100 million in remodeling expenditures creates 890 jobs. Homeownership also represents an important investment and source of savings
June 23 - July 6, 2014
for most households, homebuilders said. The latest economic data show that the primary residence represents 62% of the median home owner’s total assets and 42% of their wealth, according to the national homebuilders association. Almost two-thirds of all U.S. households own a home, while just 50% possess a retirement account and 16% own stocks and bonds. To stay competitive, homebuilders are looking for ways to control costs and a looming labor shortage will offer challenges. Columbia, like just about everywhere else, is facing a shortage of skilled construction workers and those who are still on the job – particularly craft professionals – are in the 50s and 60s. The local homebuilders association and Mungo Foundation, along with area high schools and Midlands Technical College, are recruiting young people into the construction business. As the industry starts to grow again, it’s important for the homebuilders to have the workforce ready to meet the demand, Covert said. Not having the workers can cause delays and drive up costs, he said. “We can help avoid inflation in our own construction market by being prepared for it,” he said. cr br
Reach Chuck Crumbo at 803-726-7542.
June 23 - July 6, 2014
IN FOCUS: COMMERCIAL AND RESIDENTIAL REAL ESTATE
www.columbiabusinessreport.com 17
Commercial Real Estate Firms Ranked by No. of Commercial Brokers
Phone / Website Email
Brokers / Offices / Listings
Value / No. of Transactions 2013
Types of Properties/Specialization
Top Local Official(s) / Year Founded
NAI Avant 807 Gervais St., Suite 301 Columbia, SC 29201
803-254-0100 naiavant.com INP
29 1 1,000
INP INP
Agricultural, flex, health care, hotel, motel, incomeproducing, industrial, land, multifamily, office, restaurant, retail, sports, entertainment, warehouse, Medical, investment
Todd Avant, Bruce T. Harper 1966
Colliers International 1301 Gervais St., Suite 600 Columbia, SC 29201
803-254-2300 www.colliers.com/columbia INP
26 1 620
$187,393,774 344
Flex, health care, hotel, motel, income-producing, industrial, land, multifamily, office, restaurant, retail, warehouse
David C Lockwood III 1906
803-252-8710 www.weichert.com wrrc@weichert.com
21 1 INP
INP INP
Income-producing, land, multifamily, office, retail
Ray L. Covington Jr. 1981
803-779-8600 www.wilsonkibler.com INP
20 1 358
INP INP
Agricultural, flex, health care, hotel, motel, incomeproducing, industrial, land, multifamily, office, restaurant, retail, warehouse
C. Marshall Kibler 1987
803-779-7777 www.cbre.com/columbia INP
12 1 INP
INP INP
Agricultural, flex, health care, hotel, motel, incomeproducing, industrial, land, multifamily, office, restaurant, retail, sports, entertainment, warehouse
Mary Winter Teaster 1983
803-359-9571 www.svrealty.com dana@svrealty.com
6 1 52
$56,000,000 135
Agricultural, health care, income-producing, industrial, land, multifamily, office, restaurant, retail, warehouse
Robert P. Wilkins Jr. 1986
Cypress Real Estate Partners LLC 3101 Devine St. Columbia, SC 29205
803-834-7014 www.cypressrep.com jharrison@cypressrep.com
5 1 33
$33,050,000 32
Income-producing, industrial, land, office, retail, Singletenant NNN lease investment Shopping center investment 1031 tax deferred exchanges
James C. Harrison III 2009
Coldwell Banker United, Realtors 1711 Gervais St. Columbia, SC 29201
803-799-8035 www.cbunited.com glenn.niere@cbunited.com
4 5 74
INP INP
Agricultural, flex, health care, hotel, motel, incomeproducing, industrial, land, multifamily, office, restaurant, retail, sports, entertainment, warehouse
Glenn Niere, Marcie Sain 1955
W.S. Commercial Real Estate LLC 3936 Sunset Blvd. Columbia, SC 29169
803-731-9494 www.wscrealestate.com INP
4 1 30
$500,000 9
Flex, health care, income-producing, industrial, land, multifamily, office, restaurant, retail, sports, entertainment, warehouse
William F. Smith III 1985
Merrilyn Hall Realty Inc. 840 St. Andrews Road Columbia, SC 29210
803-765-1777 www.mhallrealty.com sales@mhallrealty.com
3 1 3
$295,000 58
Land, multifamily, office, restaurant, retail
Merrilyn Hall 1985
803-298-3010 www.avisonyoung.com bruce.neel@avisonyoung.com
2 1 15
INP INP
Flex, health care, hotel, motel, income-producing, industrial, land, multifamily, office, restaurant, retail, warehouse
Bruce Neel 1978
803-799-4663 www.cbccarolinas.com/commercial INP
2 1 INP
INP INP
Flex, health care, industrial, multifamily, office, retail, warehouse
Scott K. Davis, Ed Garrison 2008
803-787-2575 www.thehoefercompany.com marshallhoefer@aol.com
2 1 14
$744,000 3
Industrial, land, multifamily, retail, warehouse
Marshall Hoefer 1992
803-781-4663 www.mcdanielsc.com INP
2 1 INP
INP INP
Health care, industrial, land, multifamily, office, retail, warehouse
Cary McDaniel 1978
803-269-3301 INP INP
1 1 INP
INP INP
Office
Anaya Meszoros 2001
803-466-4192 www.bridgegaprealty.net Bridgegaprealty@gmail.com
1 1 INP
INP INP
Income-producing, multifamily
Rachel F Thompson 2013
803-808-1260 www.gibbsrealty.net columbia@gibbsrealty.net
1 1 1
$625,000 3
Agricultural, flex, health care, hotel, motel, incomeproducing, industrial, land, multifamily, office, restaurant, retail, sports, entertainment, warehouse
Darrell Gibbs 1994
803-252-4222 www.greatsoutherncorporation.com greatsoutherncorp@fostersaad.com
1 1 INP
INP INP
Health care, industrial, office, retail, warehouse
Saundra Sloan 1999
Mabry Commercial Properties 2711 Middleburg Drive, Suite 204 Columbia, SC 29204
803-779-3555 INP INP
1 1 25
INP INP
Agricultural, income-producing, industrial, land, retail, warehouse
Henry Mabry Jr. 2000
William Durham Company, LLC 3135 Millwood Ave. Columbia, SC 29205
803-256-3591 INP wdurham@williamdurhamcompany.com
1 1 35
INP INP
Flex, health care, income-producing, industrial, land, multifamily, restaurant, retail, warehouse
William S. Durham III 1965
803-779-4420 www.EDENS.com INP
INP 1 INP
INP INP
Restaurant, retail
Terry S. Brown 1966
803-254-6613 www.securityrealty.net INP
INP 1 INP
INP INP
INP
John Papas III 1981
Company
Weichert Realtors - Ray Covington Inc. 2330 Devine St. Columbia, SC 29205 Newmark Grubb Wilson Kibler 1111 Laurel St. Columbia, SC 29201 CBRE Columbia 1333 Main St., Suite 700 Columbia, SC 29201 Southern Visions Realty Inc. 955 Old Cherokee Road Lexington, SC 29072
Avison Young 717 Lady St., Suite C Columbia, SC 29201 Coldwell Banker United, Realtors, Commercial Division 1711 Gervais St., Suite 300 Columbia, SC 29201 The Hoefer Co. Inc. 3101 Carlisle St. Columbia, SC 29205 McDaniel & McDaniel Co. 6040 Wescott Road Columbia, SC 29212 AmeriStar Commercial Inc. 208 Genesee Road Irmo, SC 29063 BridgeGap Partners Realty, LLC 201 Columbia Mall Blvd., Suite 209 Columbia, SC 29223 Gibbs Realty & Auction Co. Inc. 107A Vista Oaks Drive Lexington, SC 29072 Great Southern Corp. 1201 Hampton St., Suite 2B Columbia, SC 29201
EDENS 1221 Main St., Suite 1000 Columbia, SC 29201 Security Realty 2772 Rosewood Drive Columbia, SC 29205
INP=Information not provided. Because of space constraints, only the top-ranked companies are printed. For a full list of participating companies, visit www.scbiznews.com/data. Although every effort is made to ensure accuracy, errors sometimes occur. Email additions or corrections to lists@scbiznews.com, fax to 803-726-7404 or go to www.tinyurl.com/joinourlists.
Researched by Patrice Mack
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IN FOCUS: COMMERCIAL AND RESIDENTIAL REAL ESTATE
June 23 - July 6, 2014
At Work:
People, places and happenings across the Midlands Andrew Johnson Owner and operator of Craft and Draft Native of Lancaster, S.C. 10 years in Columbia, minus a fouryear hiatus in Charlotte working at his family’s business Something about Johnson no one else knows (other than his fiancé): “I’m a huge fan of Disney. I love everything about it. I guess you could say I have 12-year-old spirit.”
People in the News BANKING Thomas Anderson has been named vice president at SCBT. Anderson, who joined SCBT in 2007, started his career as a credit analyst in the Midlands Region and Anderson relocated to Charleston in 2009 as a commercial lender. Anderson serves on the board of the South Carolina Community Loan Fund and the Young Bankers Division of the SCBA.
CONSTRUCTION
Craft beer shop follows owner’s growing interest in new brews By Janet Jones Kendall
A
colanews@scbiznews.com
growler is defined as a refillable container or vessel into which tap beer is poured for home consump-
tion. It is a concept very familiar to Lancaster, S.C., native Andrew Johnson who might have considered himself a growler during his college days at the University of South Carolina. Now, a decade after he transferred to Columbia as a sophomore from USC-Lancaster, Johnson is putting his college days of refining his taste for beer to work as he and his college classmate and friend Kellan Monroe (a Gilbert, S.C. native) open Craft and Draft, a craft beer store and growler shop located at Devine Street between Salty’s Board Shop and Devine Foods. “(Kellan and I) both studied engineering at USC and had been tossing around the idea of opening a brewery back in college,” Johnson said. “Long story short, we decided a more viable option was a craft beer store.” For Johnson, all roads seemed to lead to this point in his life. After completing school at USC, he moved to Charlotte where he worked for his family’s construction business for four years – just long enough to get some valuable experience and realize he wanted to start a business of his own. “I have always wanted to open my own business,” Johnson said. “Working for my father’s business taught me a lot about the
daily responsibilities that accompany managing and running my own business, and I was motivated by the high-paced environment it produces, as well as taking on such responsibility. I worked as a truck driver, dispatcher, and customer sales representative – which is where I received most of my retail experience.” However, words of advice he received from his dad might be what serves him best in his own business venture. “My father has been a huge inspiration to me and what I do on a daily basis,” Johnson said. “He always taught me to continuously work to keep customers satisfied well beyond when they walk out the door. He taught me to always be honest and to only sell something or do something if I feel 100% comfortable doing it. That’s just a little of the many lessons I learned from him.” Craft and Draft features a 12-tap growler bar to fill growlers to go with premier craft beers from all over the country as well as local favorites from here in South Carolina. Customers can also take home a variety of beers featured in the store’s inventory of six packs, big bottles and cans. An onpremise consumption license gives customers the option of sitting at a bar around the growler station and enjoying the draft selection while shopping the store. “We want to continue to promote craft beer and the growth of craft beer consumption in Columbia through as many options possible, so we thought that allowing on-premise consumption would both fill that niche and give Columbia residents
more flexibility in their drinking and shopping,” Johnson said. Monroe and Johnson offer a good complement to each other as Monroe’s taste focuses more on the porter, stout, sour and IPA beers while Johnson can help any customer interested in traditional recipes like dunkels and altbiers and anything aged in bourbon barrels. Being able to open such a business in Columbia is a dream come true for Johnson who says the area offers everything he enjoys most. “I love sports—all of them. I have season tickets to USC football, basketball, and baseball, as well as season tickets to the Carolina Panthers games. Sporting events are my “escape,” and I love watching competition and athletic feats,” Johnson said. “I am also very active. I run and bike every week, run the steps at the Statehouse about twice a week, kayak once a month during the summer, and travel to the beach most weekends when the weather is warm. South Carolina is the perfect place to live to satisfy all my hobbies and philanthropies.” cr br
To keep up to date with new releases and what’s available on the continuously rotating taps at Craft and Draft, follow the store on Facebook at Facebook.com/CraftAndDraftSC, on Twitter @CraftAndDraftSC and on Instagram @CraftAndDraftBeer. Or go to the website at CraftAndDraftBeer. com. Visit Craft and Draft in person at 2706 Devine St. from 10-7 Tuesday-Thursday and 10-8 Friday and Saturday.
Hauser
R. Van Hauser has recently joined LCK as vice president for project management services. Hauser, a mechanical engineer, more than 28 years of experience in the health care industry in facilities and conSee PEOPLE, Page 21
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Business Digest Alliance Consulting Engineers celebrates 10 years
During the last decade, South Carolina-based Alliance Consulting Engineers has grown into one of the state’s largest civil and environmental engineering firms. As the firm celebrates its 10th anniversary, company leaders are looking to the future. “We are thrilled and honored to reach the milestone of our 10th anniversary, especially considering the economic challenges our nation has experienced in the last decade,” said Deepal S. Eliatamby, company founder and president. Alliance currently has offices in Bluffton, Columbia and Greenville, as well as Charlotte, N.C. To date, Alliance has worked on more than 900 projects, spanning all 46 counties in the state. One area of concentration has been economic development and working with companies that are building new facilities in South Carolina or expanding existing ones. In total, Alliance has worked with projects that represent $8 billion in industrial development and have led to the creation of 25,000 jobs. Alliance also has worked on city and county infrastructure projects. See BUSINESS DIGEST, Page 22
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June 23 - July 6, 2014
Capitalizing on the ‘new normal’
W
ith school now out at USC, I’ve started the practice of taking a weekly walk with a local client through the relatively quiet Horseshoe. It’s amazing how clearly you can think on a beautiful day in a peaceful place. On one of these walks recently, my client asked me for advice on dealing with today’s changBill ing economic enviMcCrary ronment. The last few years have been a difficult stretch for most of us. Here’s the good news, though. We are rebounding. Admittedly, things are, for most people, not completely back to where they were before the recession, but it is clear things are getting better. We are operating in what many now call the “new normal.” Throughout history, we’ve seen old forms of capitalism give way to new ones in a process Austrian economist Joseph Schumpeter called “creative destruction.” Over time, things change. We all know that. In our case, technology continues to impact the way we do business and the types of jobs and training that are available. Add to that the fact that we now live and work in a global marketplace, where national borders and languages no longer represent limits. What’s exciting, though, is that all this change brings with it a new level of opportunity. Leaders who understand the changes that are taking place, and are able to make the right moves to capitalize on them, will see enormous potential growth in the months and years ahead. Now is the time to do what entrepreneurs have always done – find new ways to meet new challenges. There are four crucial areas you need to evaluate as you seek to capitalize on this economic upswing. They are: Strategy, Systems, Staff and Skills.
Strategy
Who is your ideal customer today? Has that changed? Should it change? Will you strive to be the price leader or will you develop real value to capitalize on higher margins? Will your strategies allow you to be profitable at today’s sales volumes? You can gain market share by having lower prices, or by being perceived as being superior and providing outstanding customer service. This gives you the opportunity to achieve higher margins. Remember, though, if you choose the low price strategy, you eventually will be replaced by someone who is willing to do it even cheaper. One free piece of advice: Don’t be the one who loses money on each sale, but makes up for it in volume.
Systems
What systems currently support sales and hold people accountable in your company? Who REALLY is in charge of sales? Do you have a sales manager? Do you need a sales manager? What does your sales manager do, really? Studies show that more often than not sales managers do not increase sales. What about your compensation plan? Is it helping or hurting your efforts to motivate your people and grow your business? Who is currently coaching the sales people? What are they coaching them to do? Is that person effective?
Staff
Do you have people who can sell at higher margins? How effective are they at prospecting for, and closing, new customers? Are your current sales people “hunters” or “farmers?” Hunters take great pride in finding new business, while farmers tend to wait on old customers to call. If your “A” players were talking about someone on your payroll who shouldn’t be on your team, who would they be talking about? How long have you known that? What message does it send to the entire organization if you allow that to continue?
Skills
What new message, or approach, will your people need in order to be effective when they reach out to your ideal prospects? What is your impression when you hear them making calls? Would you buy from them? What new skills will they need in order sell at higher margins? What percentage of their proposals close? Are their proposals being shopped or used as free consulting? What skills will they need to “up-sell” or resell to existing accounts? Do they get the referrals they deserve? Begin by having conversations with your best, most consistent, most loyal customers. Why do they choose you? What services, benefits and values do you offer that draw them back again and again? Stay creative and keep listening to your customers. Seek out new ways to be useful, and to provide outstanding service. And, always remember, the market rewards those who innovate and create value – especially now! cr br
Bill McCrary is the founder and CEO of Sandler Training-South Carolina, where he coaches business leaders on ways to grow their companies and make them more profitable. Sandler is the global leader in sales and management training with centers in 23 countries worldwide. You can contact Bill at 803-771-0800or Bill.McCrary@Sandler.com.
June 23 - July 6, 2014
www.columbiabusinessreport.com 21
People in the News struction management. He will manage key assignments for the company while also overseeing the project management services operation. Bill McKinney recently joined MillerValentine Construction as a construction superintendent. He brings nearly 40 years of experience in the construction indusMcKinney try with over 30 years as a superintendent, specializing in industrial, office, education, hospitality, medical and multi-family facilities.
NONPROFIT Central Carolina Community Foundation has hired Cherise Arrendale as its interactive marketing manager. Arrendale’s role is to ensure the foundation’s online Arrendale presence reinforces the organization’s brand and its strategic objective. Prior to joining the foundation, she was the marketing coordinator at the Peace Center for the Performing Arts in Greenville. Palmer “Satch” Krantz, president and CEO of Riverbanks Zoo and Garden, is the first winner of the Stephen G. Morrison Visionary Award presented by One Krantz Columbia for Arts and History. Krantz began his career at Riverbanks Zoo in 1973 and was appointed executive director of the Zoo in 1976.
REAL ESTATE Jeremy Wilson of Newmark Grubb Wilson Kibler represented the buyer, ET Lexington LLC, in the sale of the two-story office building at 113 Reed Ave. in LexingWilson ton for $5.5 million. The property includes a 51,512 square-foot building on 3.72 acres currently occupied by TD Bank. Ben Kelly of NAI Avant represented the seller.
FINANCIAL PLANNING Mason B. Hardy, CFP, vice president at Creative Financial Strategies in Colum-
Standing from left are Sam Tenenbaum, president, Palmetto Health Foundation; Ronnie Amick; Dan Lebish, executive vice president of Aflac Group; and Kevin McRedmond. Seated from left are Piper Teal, Rob Teal, the Aflac Duck, Risha Teal and Bridges Teal. (Photo/Provided)
Aflac honors leaders in fight against childhood cancer
Aflac, a provider of voluntary insurance, presented its first 2014 Duckprints Awards to local heroes for their commitment in the fight against childhood cancer during a ceremony at Palmetto Health Children’s Hospital. Recipients were: Rob and Risha Teal, whose 7-year-old son, Bayler, died of cancer in 2010. In his memory, the couple created an endowment at Palmetto Health Foundation; Kevin McRedmond, former pediatric hematologist/oncologist at Palmetto Health Children’s Hospital, who’s now chief medical officer at Hands of Hope, Hospice Care of South Carolina; and Harold Bessent, long-time donor and fundraiser for Camp Kemo. Earlier this year, Aflac announced its new goal of $100 million for contributions to childhood cancer. Since 1995, the company has raised and contributed more than $90 million. bia, has been authorized by the Certified Financial Planner Board of Standards to use the “Certified Financial Planner” and “CFP” certification marks. Hardy has worked at Creative Financial Strategies since 2011, in personal financial planning, retirement planning, wealth management and qualified retirement plans through Lincoln Financial Services.
nors. She is an active volunteer with the South Carolina Bar and Special Olympics South Carolina.
LAW Haynsworth Sinkler Boyd P.A. received several distinctions in the 2014 edition of “Chambers USA,” a United Kingdom guide that annually ranks American law firms and lawyers. The firm was ranked in the top tier for corporate/ mergers and acquisitions and corporate mergers and acquisitions: banking and finance. Columbia attorneys recognized were William C. Boyd, George S. King Jr. and John B. McArthur. Allison P. Sullivan, partner with Bluestein Nichols Thompson and Delgado LLC, was named Young Lawyer of the Year by the South Carolina Bar Association’s Young Lawyers’ Division. She was presented the award at the division’s annual retreat and recognized during the May 8 meeting of the South Carolina Bar’s Board of Gover-
Gray
Stepp
Sowell
Watson
Four Sowell Gray attorneys have been featured as leaders in their field in the 2014 edition of “Chambers USA,” a United Kingdom guide that annually ranks American law firms and lawyers. Betsy Gray, Biff Sowell, Bobby Stepp and Cal Watson were recognized in the general commercial litigation category.
C. Edward Rawl Jr., an associate at Fisher & Phillips LLP, has been appointed to serve as the national member service project coordinator in the Young Lawyers DiviRawl sion of the American Bar Association. The cabinet-level appointment places Rawl on the senior leadership team and council. Rawl previously served as the vice director of membership and District 10 representative for South Carolina and the U.S. Virgin Islands. The South Carolina Bankruptcy Law Association inducted new officers at its annual meeting in May. The association’s leadership are Pamela Simmons-Beasley, president, of the Law Offices of Pamela Simmons-Beasley of Irmo; Robert Kerr, vice president, of Moore & VanAllen of Charleston; and D.J. Reynolds of the McCarthy Law Firm of Columbia, who will serve as secretary/treasurer. The association promotes bankruptcy legal education for attorneys. John E. Waites, United States bankruptcy judge for the District of South Carolina, was presented with the J. Bratton Davis Professionalism Award by the South Carolina Waites Bankruptcy Law Association. The award, named after South Carolina’s first bankruptcy judge, is the association’s highest honor. McNair Law Firm P.A. has been ranked a “Leading Firm” in the 2014 edition of “Chambers USA: America’s Leading Lawyers for Business.” Eight of the firm’s attorneys earned recognition as “Leaders in Their Field.” Sidney Boone Jr., Joel Gottlieb and Judith McInnis were individually acknowledged for their work in real estate, Celeste Jones in litigation: general commercial, and John Withers Currie and William Musser in the practice of corporate mergers and acquisitions. Six attorneys from Fisher & Phillips LLP in Columbia are featured in the 2014 “Chambers USA.” Attorneys Michael D. Carrouth, G. Daniel Ellzey, Fred Manning, Stephen C. Mitchell, Jonathan P. Pearson and J. Hagood Tighe are listed for labor and employment law. The firm is ranked as one of the top labor and employment law firms in the nation and state. Lee Ellen Bagley, an associate at Gaffney Lewis and Edwards LLC in Columbia, graduated from the South Carolina Bar’s Leadership Academy on May 8.
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June 23 - July 6, 2014
Business Digest Garner Johnson celebrates a year in business
ments for its private health plan and Healthy Connections Medicaid members. In 2013, BlueChoice conducted a centering pilot for its Healthy Connections Medicaid members with Greenville Health System providers that involved 70 births. BlueChoice offers similar payments for its private health plan and Healthy Connections Medicaid members. In 2013, BlueChoice conducted a centering pilot for its Healthy Connections Medicaid members with Greenville Health System providers that involved 70 births.
Garner Johnson, a full-service construction management and insurance restoration company, recently celebrated one year in its Columbia offices. Garner Johnson has done insurance restoration work for thousands of homes and businesses. The firm also has performed upfits for Westgate Mall, HTI, the state of South Carolina and others. The company formed when Joe Garner and Jeff Johnson joined forces in 2007. They have more than 30 years combined construction experience.
New deputy manager named at SRS
Palmetto Moon opens first Midlands store
Charleston-based retailer Palmetto Moon has opened its first store in the Midlands at the Village at Sandhill in northeast Columbia. Located at 630-5 Promenade Place, the store features regional specialty gifts, South Carolina lifestyle apparel and accessories, and collegiate gear. The Columbia location is the ninth store that the Palmetto Moon chain has opened. The store is open 10 a.m. to 9 p.m. Monday through Saturday, and noon to 6 p.m. on Sunday.
Red Ventures expanding Lancaster County headquarters
Red Ventures, a technology company headquartered in Indian Land, is expanding for the second time in Lancaster County since locating to the Palmetto State in 2009. The expansion is expected to add 200 jobs and a 180,000-square-foot facility called RV3. The company specializes in strategic marketing. Red Ventures expects to employ 2,000 people across its five offices by the completion of the Lancaster County expansion later this year. The building addition will complement the style of the two existing buildings on the Indian Land campus, as well as Red Ventures’ Charlotte and Wilmington, N.C., offices by offering similar employee amenities, such as an expanded bistro, beer garden, yoga room and a 21-bike indoor-cycling room. Red Ventures has also purchased more than 100 acres of the surrounding area for future use and development. Applicants interested in a career with Red Ventures may apply at the company’s career site: www.redventures.com/careers.
BlueCross, BlueChoice expand prenatal coverage
In support of a statewide initiative, BlueCross BlueShield of South Carolina and BlueChoice Health Plan have enhanced prenatal benefits to cover pilot programs intended to improve the birth rates of healthy babies. The programs involve screening of pregnant
Gov. Nikki Haley, left, applauds as Lou and Bill Kennedy, foreground center, cut the ribbon on their company’s new manufacturing facility at Saxe Gotha Industrial Park in Lexington County. (Photo/Chuck Crumbo)
Nephron plant now open for business A sign hanging over the front door of Nephron Pharmaceuticals’ facility in Saxe Gotha Industrial Park quoted the longtime hit tune, “Nothing could be finer than to be in Carolina.” And for Nephron owners Bill and Lou Kennedy there was plenty to sing about recently as they cut the bright blue ribbon that graced the plant’s main entrance, signaling that the facility is open for business. “Everybody knows we build airplanes, everybody knows we build cars, everybody knows we build tires,” said Gov. Nikki Haley, joining about 200 local officials, vendors, contractors, and Nephron employees at the ribbon-cutting. “Now everybody knows we make pharmaceuticals, and not just any pharmaceuticals. We’re going to have the Taj Mahal of pharmaceuticals.” Haley said the facility represents a major step in the state’s effort to develop research and development in the life sciences. “It’s a game changer,” said Mike Briggs, president and CEO of Central SC Alliance. The plant, which will make products like ophthalmic and injectable medications, generic inhalation solutions and vaccines, represents a $313 million investment that the Kennedys have committed to make in the Midlands. The 408,000-square-foot Nephron facility is located on a 60-acre site complete with ponds, fountains and finely manicured landscaping. Nephron has about 100 workers at the new plant and expects to have more than 700 on board in 10 years. The average wage will be about $71,000.
women for maladies like depression or drug use and group care that integrates health assessment, education, and support. In May, both BlueCross BlueShield of South Carolina and BlueChoice HealthPlan of South Carolina began reimbursement for a program called SBIRT, which stands for Screening, Brief Intervention and Referral to Treatment. As part of the program, physicians screen pregnant patients for depression, domestic violence, and tobacco, drug or alcohol use, and make referrals for treatment if needed. The screening program is included as preventive care required by the Affordable
Care Act. Beginning June 1, the companies enhanced coverage for a program called Centering Pregnancy, in which 10-12 women whose babies are due at about the same time participate in group visits. The women receive routine medical care, participate in discussions, and receive support. Visits last much longer than a typical checkup — usually two hours. In addition to paying the global maternity rate, the insurers will make an incentive payment to the medical providers for each patient who attends a session and another payment if she attends five or more sessions. BlueChoice offers similar pay-
Terrel Spears, a 35-year veteran of federal service in the U.S. Department of Energy and the Department of Defense, has been named deputy manager of the Savannah River Site. Spears has broad leadership responsibility for approximately $1 billion in annual operating and construction activities at the Aiken County facility. Other Energy Department positions he has held include assistant manager for Waste Disposition Project. The job involved the safe management, treatment and disposition of highly radioactive waste resulting from Defense materials production, as well as all low-level radioactive, transuranic (TRU), hazardous, mixed and sanitary waste in support of the Office of Environmental Management’s risk reduction and cleanup mission at SRS. Other senior level positions Energy Department positions Spears has held include director of the Salt Waste Processing Division and Federal Project Director for the Salt Waste Processing Facility, director of Site Integration and Planning Division, and deputy assistant manager for Science, Technology and Business Development.
University Associates names new officers
Charles W. “Chuck” Garnett, president and chief executive officer of the National Bank of South Carolina, has been elected president of the University of South Carolina’s University Associates for the 2014-2015 term. Luther J. Battiste III, attorney with Johnson, Toal and Battiste, was tapped to be president-elect; Susie H. VanHuss, author and former university faculty member and administrator, was elected vice president; and J. Cantey Heath, Jr., chief of staff and special assistant to the University of South Carolina president, was elected secretary-treasurer. Founded in 1964, University Associates is a “town and gown” organization of Midlands area business, community and professional leaders committed to supporting and promoting the university.
Viewpoint: USC biologist’s Chernobyl research shows value of scientific inquiry Views, perspectives and readers’ letters
T
he first thing I noticed about the e-mail I received on a recent Sunday afternoon was the subject line that said “Chernobyl studies.” It took me a second to register that Tim Mousseau was back in the Ukraine, studying the genetic consequences of the Chernobyl nuclear reactor explosions on animal life in the territory now largely deserted by people. I first wrote about James T. Tim’s research with Hammond a French academic collaborator in 2006. At that time, Tim and his collaborator were conducting research largely ignored by governments and academic institutions. “I was just thinking back to the very first article on our work, one that you wrote a few years back for The State,” Tim wrote in his e-mail from Chernobyl. “This was the first time that I thought what we were doing might be of some general use. You could see it even if I was uncertain. “ This biologist and professor at the University of South Carolina has recently had media attention that could move his research forward if the right people see the results of this decade-long research in the “exclusion zone.” In May, the New York Times sent reporter Henry Fountain to visit Tim at Chernobyl and published an article about the research. And when Tim wrote his e-mail to me, he was awaiting the arrival of Bob Simon of the CBS Sunday evening program 60 Minutes. Reflecting on the evolution of his research, he was writing to thank me again “for the big plug back when I needed it to keep going.” It was the kind of feedback that journalists don’t often receive, and it makes me recognize what an important role the media can play in boosting projects that need it, in sometimes connecting the dots between research and the funds needed to keep it going, and giving encouragement to people who are engaged in hard work that takes a very long time to pro-
duce results. It’s not that journalists set out to boost anything. We are basically inquisitive people with an implied license to be nosy and ask a lot of questions. We are storytellers looking for that person, that endeavor that stands out from the background noise of human activity. Tim’s research certainly stood out to me. Two decades after the 1986 explosions at Chernobyl, when much of the world had consigned Chernobyl to the history books, he was making regular trips to the region to take DNA samples of birds, insects and other wildlife to be able to compare genetic changes caused by the persistent radioactivity that blanketed the region. His confidence that the research was of value waned as the years passed. The academic world did not seem as interested in his work as he had hoped. But the New York Times said that has changed since a tsunami destroyed the Fukushima nuclear plant in Japan in 2011. While many of the circumstances were different from Chernobyl, the blanket of radioactive contamination around Fukushima could produce genetic impacts similar to those in the Chernobyl region. Tim has traveled to Japan several times to study the impact, and the Times reported he’s already observed changes in animal life. Tim’s research, and his tenacity, is a vivid reminder that academic research that produces knowledge is a lifelong endeavor to which not everyone is suited. And even those who stay the course sometimes need encouragement. Tim said as much in his e-mail to me. “Last week was cold and wet, this week hot and buggy! I confess it’s not as much fun as it used to be although I suspect this is mainly because I am getting old(er) and it hurts more! Ha. However, I can’t stop now as it seems we really are onto something,” he wrote. This inquiry, and the benefits it might one day bestow on the human race, is a marathon, not a sprint. Institutions such as the University of South Carolina are uniquely suited to foster scientific
Tim Mousseau, a biologist at USC, has been studying the impact of radiation at Chernobyl, Ukraine, on animal life such as the yellow bunting pictured above.
inquiry that takes years or decades to accomplish. Tim is not unique at the university in pursuing such knowledge; he’s just one I know better than others. It’s easy to be distracted by the struggles between a public university and state government, or disagreements with the host city of Columbia over traffic, building codes and public safety issues. Sometimes it may seem that the university’s primary mission is entertainment in the form of football, basketball or baseball. But it’s important to remember that a public research university has two foremost missions: to educate each new generation of South Carolinians to become responsible and productive adults; and to provide an environment where basic research can be pursued, insulated as far as is possible from the financial and political pressures that the university’s leaders face daily.
Tim is far from being an ivory tower academic. He has served as dean of the Graduate School, associate vice president for research and graduate education and associate dean for research and graduate education in the College of Arts and Sciences. But through his years spent helping administer the university, he has maintained a love of science that keeps him on the road to Chernobyl and Fukushima, adding to the body of knowledge that might one day help other scientists address such a disaster, should there be another one. So, this is my unapologetic plug for basic scientific research, and for people like Tim Mousseau who cling to it when the weight of fundraising and administration can be powerful distractions. James T. Hammond is editor of the Columbia Regional Business Report. Reach him at 803-726-7545.
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June 23 - July 6, 2014