By Rob White
The past several weeks have been very interesting. I have met with what has seemed like a continual parade of companies, developers and brokers in response to the news that Bayer Crop Science is moving. I have also been contacted by local and regional leaders offering ideas, advice and their solutions to what appears to have become a topic that has far-reaching implications.
It appears we are about to experience something akin to musical chairs as the companies try to figure out how to best leverage their opportunities for the future.
Let me start with the businesses first. I can’t discuss details because I was asked to provide confidentiality, but each company has stated they have plans to grow several hundred percent over the next five years. This means several hundred jobs, investment into facilities in the tens of millions of dollars and more permanency for the next decade or two.
Each company has echoed the idea that they want to be in close proximity to the university and are willing to pay the surcharge to be in Davis so they can have that connection.
In some cases, the acreage they need for the appropriately sized facilities does not exist within the Davis city limits.
In the case of the developers, we have discussed potential options on existing land and within existing facilities that might provide opportunities for some of this business growth. We have also discussed the opportunity to build some spec spaces on Second Street and in other areas throughout the city. In the case of the brokers, city staff have reviewed and toured much of the available space in the city and continue to identify opportunity locations for the businesses that have indicated their needs.
It is very exciting to see how positive our local policymakers and leaders are responding to the need to best address the issue of business facility needs. Each of them is talking with their networks and working through the opportunities to, we hope, ensure that we mitigate as much movement out of Davis as possible.
And the regional leadership has reached out to provide support and encouragement, realizing that the university is one of the most important regional assets to continue business growth in the region. Nothing demonstrates that growth engine more than Bayer’s expansion followed a week later by the news of Marrone Bio Innovation’s IPO.
But why does it matter? Why are we working so hard as city staff and local leaders to facilitate these companies’ growth needs and working to keep them in Davis if at all possible?
It might be best answered with the following points:
* Every job lost from Davis is a loss from local purchasing … loss of gas sales, lunch sales, catering of office events, stops at the grocery store, etc. These sales do not get reallocated or absorbed by the existing job base. They are just lost. Lost until we grow more jobs to replace them.
* We also see a loss of revenue and income to the businesses that these employees visited. In the case of Bayer, it will impact places like Dos Coyotes in South Davis. It will impact the employees at service businesses by decreased sales and loss of income from tips.
* Loss of a company means we also lose the potential of sponsorship and philanthropy, local leaders in our community and business organizations like the Chamber of Commerce and Rotary Club, and volunteers for our community events and fundraisers.
* Maybe most difficult to measure, but very important to recognize, is that the loss of a major international business interest means we likely will lose future investment by that corporation in new startups and entrepreneurs.
* And we lose the community identity that these corporations bring and the place-making opportunities that come from recognition of Davis as the home of these companies. Ask Berkeley how it felt to lose Bayer’s investment, first to Emeryville and then to Mission Bay (San Francisco). Look at how important companies are to the identity of a city, like Intel is to Folsom or Genentech to Vacaville. These companies started small and grew into global giants, investing heavily in their communities.
And if you disagree with this last point, I can tell you that earlier this month a public official from Folsom stated to a group of his peers at a dinner that it was because of Intel that Folsom enjoyed such exposure and investment. They have approximately 5,000 jobs attributable to Intel and are a major reason for Folsom’s current fiscal health.
Intel’s employees volunteer in the community, raise funds for local charities and are leaders in Folsom’s local organizations. Over the past five years, Intel has contributed more than $50 million to charities in the San Francisco and Sacramento areas. Since 2000, Intel has invested $4.3 billion-plus in manufacturing capital investment, much of that being done at the Folsom campus.
In just under 30 years, the Folsom campus has grown well beyond the two office buildings and couple of hundred employees that started the facility. Sound familiar? Think that a decade or two of growth for a company like Bayer Crop Science or FMC Schilling Robotics or Marrone Bio Innovations might make a significant difference to Davis? A difference in the number of jobs, sales, revenues and philanthropy? A difference in how people think of Davis … not just as a place that companies start or grow, but a place where they thrive and give back and lead.
This is why we are working so hard to make sure we keep as many of these potential opportunities local as possible. There is no way to know who will be the next Intel, but having global companies investments or successful IPOs is a sure sign that we are much more likely to see these successes.
So let’s work together to keep as many of these companies local as possible, let’s invite new ones to locate here and let’s work strongly with our university and research communities to start some more. We owe it to ourselves, the region and the world to be the best possible location for companies to grow and solve the world’s issues in agriculture, sustainability, energy, transportation, engineering and manufacturing.
As always, please let me know your thoughts. My email is email@example.com.
— Rob White is the city of Davis’ new chief innovation officer.