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ENCORE Fayette - Anatomy of a deal
 

ENCORE Fayette - Anatomy of a deal

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An historical recap of the recruitment of SANY America to Fayette County, Ga, presented to the ENCORE Fayette Class on February 14, 2013.

An historical recap of the recruitment of SANY America to Fayette County, Ga, presented to the ENCORE Fayette Class on February 14, 2013.

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  • Distance to Hong Kong = Distance from Atlanta to Orlando.Distance to Shanghai = Distance to Washington, D.C.Distance to Beijing = Distance to Green Bay, WI

ENCORE Fayette - Anatomy of a deal ENCORE Fayette - Anatomy of a deal Presentation Transcript

  • A Behind the Scenes Perspective of How Sany America Came to Fayette County, Georgia February 14, 2013 Matt Forshee President/CEO
  • Overview Primer on Economic Development in Georgia Sany: The Company, Products and Equipment Project Development, Recruitment & Location Facility Site & Building Plans Lessons Learned Questions
  • What is Economic Development?
  • Creation of Wealth
  • How do we do that in Fayette County?
  • Recruiting New Industry & Office
  • Economic Development in Georgia
  • Site Selection: Project Origins Project originated as a direct “call-in” to the Metro Atlanta Chamber in September of 2005.
  • Site Selection: Project OriginsSany began a comprehensive nationwide site search , which considered several Metro Areas.
  • SANY: The Company Headquartered in Changsha, Hunan Province, China  Hong Kong – Jacksonville  Shanghai – Wash. DC  Beijing – Green Bay Pop – 6 m + (19th largest in China)
  • Sany: The CompanySany has manufacturing operations in Changsha, Beijing, Shanghai, & Shenzen. They have announced additional facilities in India, Germany and the US.
  • Sany: The Products
  • Sany: The Products
  • Sany: The Products
  • Sany: The Products
  • Sany: The Products
  • Sany: The Products
  • Sany: The Products
  • Sany: The Products
  • Sany: The Projects Sany currently holds the Guinness world record for the highest elevation reached by a single pump – 406 meters (1332 feet). This was performed during the construction of the Hong Kong International Financial Center.
  • Sany: The projectsSany equipment has been involved in the construction of the Three Gorges Dam on the Yangtze River, the largest hydro-electric power station in the world.
  • Site Selection: Project OriginsThe initial requirement from the company called for 350,000 square feet of existing space under roof for assembly of concrete pumps and pump trucks.
  • Site Selection: Timeline Summary Representatives from Sany make initial contact with the Metro Atlanta Chamber of CommerceSEP OCT NOV DEC JAN FEB MAR APR MAY JUN JUL AUG 2005 2006
  • Site Selection: Timeline Summary Initial Georgia Team is builtSEP OCT NOV DEC JAN FEB MAR APR MAY JUN JUL AUG 2005 2006
  • Site Selection: Timeline Summary Initial Sites Submitted for an assembly facility: McDonough (I- 75) & Palmetto (I-85)SEP OCT NOV DEC JAN FEB MAR APR MAY JUN JUL AUG 2005 2006
  • Site Selection: Timeline Summary Additional Sites Submitted: Waynesboro (I-20),Griffin (I-75) & McDonough(I-75)SEP OCT NOV DEC JAN FEB MAR APR MAY JUN JUL AUG 2005 2006
  • Site Selection: Timeline Summary DEcD and GPC meet with Sany at World of Concrete Trade Show in Las Vegas, Nevada.SEP OCT NOV DEC JAN FEB MAR APR MAY JUN JUL AUG 2005 2006
  • Site Selection: Timeline Summary Additional Sites Submitted: Stockbridge (I-75), Newnan (1-85) and Morrow (I-75).SEP OCT NOV DEC JAN FEB MAR APR MAY JUN JUL AUG 2005 2006
  • Site Selection: Timeline Summary Sany changes the parameters dramatically. The project is reduced to a small warehouse for parts, 1-2 acres & 30,000 sf, to be operated as Synnium.SEP OCT NOV DEC JAN FEB MAR APR MAY JUN JUL AUG 2005 2006
  • Site Selection: Timeline Summary Georgia Team begins looking for new sites that meet parameters for small distribution location.SEP OCT NOV DEC JAN FEB MAR APR MAY JUN JUL AUG 2005 2006
  • Site Selection: Timeline Summary Project returns to original parameters for Assembly & adds HQ function. Peachtree City site is proposed on paper to Sany.SEP OCT NOV DEC JAN FEB MAR APR MAY JUN JUL AUG 2005 2006
  • Site Selection: Timeline Summary Local team is added.SEP OCT NOV DEC JAN FEB MAR APR MAY JUN JUL AUG 2005 2006
  • Sany: The SiteWe proposedthe Cooper Loopproperties: 228acres in the PTCindustrial park. Hasaccess to all utilities, ona state divided highwayand in foreign trade zone.
  • Site Selection: Timeline Summary Sany officials first visit Peachtree City. First incentive proposal is sent to Sany’s Board of Directors.SEP OCT NOV DEC JAN FEB MAR APR MAY JUN JUL AUG 2005 2006
  • Site Selection: Timeline Summary DEcD and GPC make 2nd trip to WOC in Las Vegas to call on Sany’s project team.SEP OCT NOV DEC JAN FEB MAR APR MAY JUN JUL AUG 2006 2007
  • Site Selection: Timeline Summary A revised proposal of incentives from DEcD and Fayette County is sent to Sany’s Board of Directors.SEP OCT NOV DEC JAN FEB MAR APR MAY JUN JUL AUG 2006 2007
  • Site Selection: Incentives • State Proposal • Job Tax Credits $ 3,618,750 • GA Quick Start $ 2,316,000 • Sales & Use Tax Exemption $ 600,000 • REBA Grant $ 900,000 • Local Proposal • Tax Abatement (Real & Personal) $ 4,693,696 • FCDA Grant $ 150,000 • Fayette County Grant $ 150,000 • PTC Grant $ 50,000 • Total $12,478,446
  • Site Selection: Incentives• Average Incentive Per Job • State $12,391.25 • Local $ 8,406.16 • Total $20,797.41• Fayette County Cost/Benefit Analysis • After all incentives local taxes, fees and services are accounted for, Fayette County still shows a positive growth of $29,000 in Year 1 of the facility. By Year 10 we have accumulated an average annual net benefit of $603,744. • After YR 10, average annual benefits are $1,157,739.
  • Site Selection: Timeline Summary DEcD and GPC team makes 1st trip to China to call on Sany. Visits headquarters in Changsha.SEP OCT NOV DEC JAN FEB MAR APR MAY JUN JUL AUG 2006 2007
  • Site Selection: China Visit #1Company reps had indicated several times that Georgia was at a disadvantage by nothaving visited the board members in China
  • Site Selection: The Grand Tour
  • Site Selection: Timeline Summary FCDA and Pathway Communities accompany DEcD and GPC on 2nd trip to Changsha and Sany’s HQ.SEP OCT NOV DEC JAN FEB MAR APR MAY JUN JUL AUG 2006 2007
  • Sany: Fayette goes to Changsha
  • Sany: Fayette goes to Changsha
  • Site Selection: Timeline Summary Sany Board of Directors votes 8-1 to select Georgia over competing other states and cities.SEP OCT NOV DEC JAN FEB MAR APR MAY JUN JUL AUG 2006 2007
  • Site Selection: AnnouncementSept 2007: Sany publicly announces intent to locateNA HQ and Assembly in Peachtree City. From Sept 05 to Sept 07, process was a 2-year effort!
  • Site Selection: Announcement Initial investment announced was $30MM USD,now revised to roughly $70MM USD. It will employ up to 600 people over 10 years.
  • After Site Selection: Legal Docs Crafting a Memorandum of Understanding  Signatories (and Attorneys) included Sany, FCDA, Fayette County & Peachtree City Tax Abatement Bonds  Initially issued $30MM in bonds for Tax Abatement structuring Grant Application  REBA grant required a large application process that took longer than expected
  • Sany: Proposed Site PlanSite Data•228 Acres•Assembly Bldg 1 (ph 1) •325,000 sf•Assembly Bldg 2 (ph 2) •500,000 sf•Assembly Bldg 3 (ph 3) •500,000 sf•Distribution Center (ph 1) •100,000 sf•Office, R&D Bldg (ph 1) •140,000 sf•Total – 1.5 million sf
  • Sany: Proposed Site Plan
  • Sany: Proposed Site Plan
  • Sany: Proposed Site Plan
  • Sany: Proposed Site Plan
  • Sany: Lessons LearnedTime was always on Sany’s side (and they used it!) To balance this, we had to formulate uniquequalifiers and expirations for land and incentives.
  • Sany: Lessons LearnedSany’s site selection process was very unique and quite different from most US orEuropean companies. The process could be quite frustrating at times.
  • Sany: Lessons LearnedThe Chinese concept of Guanxi has no truecomparison in Western Culture. You mustunderstand the implications to succeed in Chinese business, industry & society.
  • Sany: Lessons Learned There are some major visa issues forpermitting Chinese Nationals to work in theUS, but the companies are also aware of the tax benefits to rotating employees.
  • Sany: Lessons Learned To do business in China, you have to experience China.
  • To learn more about the business opportunities inFayette County, contact the Fayette County DevelopmentAuthority. We can help you with:• Available site and building information 200 Courthouse Square• Comprehensive demographic information Fayetteville, GA 30214• Labor statistics• Community tours• Customized state incentive proposals• Groundbreaking ceremony coordinationMatt Forshee, President/CEOmforshee@fayettega.orgPH: 770-461-5253 • FX: 770-460-0259www.fayettega.org