Roanoke Times
Copyright (c) 1995, Landmark Communications, Inc.
DATE: SUNDAY, May 30, 1993 TAG: 9305300202
SECTION: VIRGINIA PAGE: A14 EDITION: METRO
SOURCE: MICHAEL STOWE STAFF WRITER
DATELINE: WINSTON-SALEM, N.C. LENGTH: Medium
In fact, from 1985 to 1987 the situation was bleak, said James Lockery Jr., director of economic development for Winston-Salem Business Inc.
Many of the problems that faced Winston-Salem mirror problems facing the Roanoke region now, with the merger of Dominion and First Union banks, the closing of the Gardner-Denver plant and other economic upheavals.
During the mid '80s, Winston-Salem lost two of its largest corporate headquarters when Piedmont Airlines was acquired by USAir and R.J. Reynolds Tobacco Co. merged with Nabisco and shifted its headquarters to Atlanta.
RJR Nabisco is still Forsyth County's largest employer, but more than 2,500 jobs were lost when the company's headquarters moved to Atlanta.
The Piedmont acquisition actually added jobs, but it was still a blow to the community's pride.
"Losing a corporate headquarters affects the identity of the community," said Robert Leak, president of Winston-Salem Business.
In late 1987, AT&T started phasing out an 880,000-square-foot plant and cutting 3,500 jobs.
Up to that point, Winston-Salem's Chamber of Commerce had been in charge of economic development. It had attracted little industry, however. The steady expansion of existing companies had made local business leaders complacent.
All the chamber did was look after the companies already there and help companies that found Winston-Salem on their own, Leak said.
When the companies started downsizing, business leaders began to criticize the chamber's failure to create jobs and decided to take matters in their own hands.
They teamed up in 1987 to form Winston-Salem Business, a nonprofit organization with the sole purpose of attracting industry.
Founders included Gerald Long, former chairman of Reynolds Tobacco Co.; John Davis III, managing director of Alex Brown & Sons Inc; and John McNair, then president of Wachovia Bank.
The group raised $1 million in corporate funds to finance the organization for three years. They soon found out it was money well spent.
Since its formation, Winston-Salem Business has landed 34 projects and created more than 3,120 jobs.
Landing Siecor's new plant - which plans to employ about 500 workers by 1995 - is just one of several major victories in the last year.
Just days before Siecor's decision, Pepsi-Cola announced it would open a customer service center employing more than 1,000 workers.
Southern National Bank, the state's sixth-largest bank, announced in November that it would move its North Carolina headquarters from Lumberton to Winston-Salem and create 200 jobs.
Wachovia Corp., which has been headquartered in Winston-Salem since it was formed, announced plans to build a new 20-story, 400,000-square-foot headquarters in downtown. With more than 518 branches and $31.8 billion in assets, Wachovia ranks 22nd among U.S. bank holding companies.
One of the secrets to the success is having a good relationship with local governments so Winston-Salem Business Inc. can offer attractive incentive packages.
Leak used the Pepsi deal as an example, saying that $1 million was needed to help secure the soft-drink company's space in the building that used to house RJR Nabisco's headquarters.
Within 24 hours of being asked, the city had committed $500,000 to the project. The county contributed the rest.
"An economic developer is a coach," Leak said. "Without a team, you can't win. I can't negotiate without the county and city being involved."
But unlike most economic development groups, Winston-Salem Business doesn't have to rely on public funding to get a project done.
When the group needed $750,000 to buy a 115-acre site for an industrial park, it got some of the money from loans with local banks and the rest from private funds in the organization's budget.
Lockery said he is constantly amazed by the collective support the Winston-Salem business community displays toward economic development.
He cited the Southern National Bank deal as an example. Business leaders decided the best way to lure the bank to Winston-Salem was to guarantee commitments for $100 million in new deposits.
A campaign was started to solicit deposits and in less than two years the city had met its goal of $100 million. About 80 companies and just over 300 individuals agreed to deposit money in the bank.
Leak realizes that Winston-Salem is on a hot streak, but he doesn't take it for granted.
"We're growing right now, but who knows what will be happening in five years," he said.
by CNB