The formal announcement Thursday of Indiana County’s largest job-creation project in half a century set off speculation throughout the area of what could happen next.
With more than 800 temporary and permanent jobs associated with the project, the ripple effects in the local economy would include surges in merchandise sales, profits, hiring, personal income tax collections and possibly more, according to a professor of economics at Indiana University of Pennsylvania.
Philadelphia-based Urban Outfitters, the company murmured early this year to be interested in a massive slice of the Windy Ridge Business & Technology Park in White Township, went public after paying $5.6 million for about 48½ acres of land for an Eastern U.S. fulfillment center.
With the site deed finally in hand, Chief Development Officer David Ziel predicted 600 tradesmen and craftsmen would be needed to build an 836,000-square-foot facility for URBN, and about 225 people would be hired for full-time jobs running the center.
Construction will begin within weeks and be finished in 10 months, Ziel said.
Naturally, the influx of that kind of traffic to the site near the Route 422 and 286 interchange will mean extra drivers fueling up at Get-Go or picking up lunch at the McDonald’s drive-thru at SouthTowne Plaza. Those are easy guesses; business should pick up all along Oakland Avenue.
The next foreseeable ripple: some of those merchants, and others in the Indiana area that directly or indirectly provide services to the URBN center, probably will hire more workers to answer the demand.
Then there’s the trailblazing effect.
What starts today with a never-before-seen creation of hundreds of jobs on one site could be followed by another company creating a supply-side hub in Indiana County.
“Simply from the standpoint of saying this type of work, from this type of nationally known and well-regarded firm – 225 jobs, this is a good day for the county. That’s a positive,” said David Yerger, the chairman of the Department of Economics at IUP.
“What history suggests could happen, in the optimistic view, is that the toughest firm to attract in an area is the first firm. If they come in and have a positive experience, and maintain or expand their staffing, that makes it even easier for the economic development folks to recruit the next firm.”
Success for URBN could breed more investment in the area, according to Yerger.
“You have a well-regarded firm from the Philadelphia area, now developing an awareness and understanding of how things work in Indiana County. If they have a positive experience, that’s a plus,” he said.
Yerger, a member of the Economics Department faculty since 2002, said that what bodes well for Indiana County and Western Pennsylvania is, as Ziel mentioned, that Eastern Pennsylvania has been saturated.
“What we do know is that with so much of the growth that has happened in the greater Carlisle area and east region, it has become quite a bit more expensive to locate things like this out there. Land costs are notably higher, labor costs are higher,” Yerger said.
“From my perspective, it’s quite plausibly the first of more to come,” he said. “Hopefully that’s the direction we will go, because absolutely the county could use some employers coming outside of meds and ed.”
Yerger cautioned that the next major retail distribution center still may be years away, but will happen sooner than the decades of effort that led to URBN.
The immediate impact may be easier to estimate, he said.
“If someone suggested 225 jobs from direct employment could spin off another 60 to 75 indirect jobs, that would strike me as plausible,” he said. “It would be easier be critical and say ‘oh, it’s only a few hundred jobs versus the thousands and thousands of jobs already in the county.’ But at the margin it’s a positive development, especially since it kind of represents a new direction.
“If it was IUP or IRMC doing an expansion, that would be wonderful, but it wouldn’t necessarily have the same potential implications for this sector becoming a bigger part of the community. … This is a good thing and it would be a wonderful thing for another retailer saw how it was working out for these folks and explored taking other space in the same area,” Yerger said.
Yerger said some economic data allows a better prediction of the spin-off effects of a large economic investment when other factors are known, such as the kind of products being handled and where they stand in the chain between raw materials and consumer-ready products. With the URBN project, where officials have not announced the exact function of the building beyond being a “fulfillment center,” Yerger said it appears the ripple would be less than one-for-one secondary job creation.
“The most positive thing that’s coming out for me is not so much the actual number of immediate spillover jobs, but how this raises the possibility that five or six years from now, Indiana County may have a few more of these types of operations establishing themselves,” Yerger said.
“The first one’s the hardest.”
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Indiana County Development Corporation welcomed about 150 guests for the groundbreaking ceremony Thursday morning at Windy Ridge. ICDC President Jim Wiley spoke from stage set up at the end of a cul-de-sac that he said would end up being plowed under for construction of Urban Outfitters’ massive 836,000 square foot center.
Although Urban Outfitters had never been identified as the developer in mainstream media or in public settings over the last eight months, many among the crowd considered it one of the “worst-kept secrets” of the year.
Wiley headed an agenda that included 10 area politicians and dignitaries who spoke at the groundbreaking. Executive Director Byron Stauffer of the Indiana County Office of Planning and Development had himself exactly where he wanted: absent from the list.
Still, Stauffer’s name was one of the most-often mentioned of the program.
Earlier identified by Ziel as the key figure among the economic leaders who attracted URBN to Windy Ridge, Stauffer heard speaker after speaker thank him for helping to land Urban Outfitters, and Indiana County Commissioner Rod Ruddock summoned him, “the man of the hour,” to the stage.
Stauffer left his vantage point from behind the rows of seats set up for the program, climbed to the stage for a smile and a handshake — many rose to applaud his efforts — and declined an offer to speak before exiting. His only formal role was at the handle of one of 27 shovels the dignitaries used to turn some earth and signal the beginning of construction.
The next-most-often mentioned name of the day was State Rep. Dave Reed, cited by many in the same breath as Stauffer for leading URBN to consider Indiana County for its new home.
Reed spoke publicly for the first time about his connection with Urban Outfitters executives that far outdated the local campaign for the company’s investment in Windy Ridge.
Six years ago, long before Reed became the House Majority Leader, he said he was among a contingent of lawmakers who met Ziel in Harrisburg and legislatively helped the company to develop a mega-distribution center in Lancaster County and a huge world headquarters in Philadelphia.
“A lot of people come into my office with a lot of great ideas and most of them never happen,” Reed said. “But there was something about David. When he left, I turned to my staff and said, ‘I think he’s actually going to build this thing.’ Lo and behold, he built it, and he far exceeded the numbers that folks ever thought they were going to see in Gap,” Reed said.
Next, he said, he lobbied Urban Outfitters to put Indiana County on the short list for its next new location, and introduced Ziel to the county development team.
Reed, who will retire from the state House when the legislative session ends following the General Election in November, talked about the URBN project in superlative terms in the context of his time in office.
“A $30 million investment by the private sector in Indiana County may be the most exciting thing I’ve ever been able to announce in 16 years in the Legislature,” Reed said. “My goal has been to try to turn the page from the last chapter in Indiana County’s economic history to the next, and finally make that chapter be bright again.
“Today with this announcement, I can finally leave in November with peace in my heart and peace in my mind, knowing that I did everything I could to help move this county forward.”
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Basking in the glory clearly wasn’t on Stauffer’s to-do list as Urban Outfitters and Indiana County Development Corporation publicly unveiled the plan for the $30 million fulfillment center at Windy Ridge.
Within hours of the late-morning celebratory groundbreaking, Stauffer was on the road to help strengthen the marketability of Indiana County’s industrial park properties.
At a special meeting of the Burrell Township board of supervisors at mid-afternoon, Stauffer ushered the township leaders through the adoption of an ordinance granting tax breaks in the Corporate Campus light-industrial park near the interchange of Routes 22 and 119.
In between the groundbreaking and the township meeting, Stauffer said, he handled call after call from people interested in the URBN development.
“My phone rang all afternoon,” he said. Calls came from publications — Site Selection, Developing Pittsburgh, Made in PA and others.
At the session in Black Lick, the supervisors agreed to add three undeveloped lots to a previously designated Keystone Opportunity Expansion Zone, and consented to renew the KOEZ status for several lots where the tax break package would expire at the end of the year.
Included are the Interchange Center and a second multi-tenant building intended for smaller companies, both owned by Indiana County Development Corporation.
The Interchange Center offered 15 years of relief from real estate, earned income, net profits, mercantile and other business taxes under Keystone Opportunity Improvement Zone status.
“We’re marketing the heck out of these parks,” Stauffer said. One potential candidate, Stauffer told the supervisors, is a Lithuanian furniture manufacture that could end up partnering with URBN for distribution, or being put under its own roof at Windy Ridge or Corporate Campus.
The lots vacated a few months ago by the WyoTech automotive school also are being restored to the KOZ list, Stauffer explained.
“These went on in 2010, but then they came off because they went non-profit,” he said. “But now that there’s no school there, they should go back on the tax rolls.”
Stauffer said roughly two-thirds of the 100-acre park has been developed, leaving about one-third spread over several idle lots on the fringes open for businesses to relocate or start anew.
“They expire in December 2018. In order to extend, you have to have the application in (to the state) by Oct. 1,” Stauffer said.
Then came suggestions from the supervisors as the meeting broke up. A 24-hour fitness center, Dan Shacreaw said. And he named some popular national restaurant chains.
Stauffer took the ideas.
Congratulations on URBN were not in order.
“No, no,” Stauffer said. “That’s not my bag. I just like to watch it all unfold; I just work, let the leaders take the credit.”