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N.C. Railroad Co. investing $13 million

David Mildenberg on November 2014 at 5:45:00 pm 
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The North Carolina Railroad Co.’s board approved more than $13 million in improvements to its system as part of a six-year plan to spend $60 million. The moves follow a strategic plan adopted in 2013 to increase the company’s economic development efforts.

Since 2000 the railroad has invested more than $80 million in capital projects. (On down the line, February 2014 cover story.)

The largest project among those approved by the board is $5.4 million for improving tracks and sidings in Cabarrus and Mecklenburg counties.

The company is a privately owned corporation with its stock owned by the state of North Carolina. Created in 1849, it manages 317 miles of track from Charlotte to Morehead City. The company is governed by a 13-member, all-male board of directors.



 

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Unemployment rate declines to 6.3% in October

Courtney Price on November 2014 at 3:45:00 pm 
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North Carolina's unemployment rate fell to 6.3% in October, 0.4 percentage points below September's rate of 6.7%, and average earnings declined slightly, according to a report from the N.C. Department of Commerce. The rate has declined 1.2 points over the past year, though it remains above the national rate of 5.8%.

The state had 4.18 million employed in nonfarm, seasonally adjusted jobs, exceeding the pre-recession high of 4.17 million in February 2008, according to a release from Gov. Pat McCrory. The state's employment declined for 24 consecutive months, bottoming at 3.84 million in February 2010.

Over the past year total state employment has increased 28,447, the Commerce Department said. About 294,000 people are unemployed, or about 55,000 fewer than a year ago.

Education and health services added 6,100 jobs, while leisure-hospitality services and government each added 3,500. Financial activities reported a decline of 2,000 jobs.

Preliminary numbers show average hourly earnings fell 8 cents to $16.59, while average weekly hours dropped 18 minutes. Average weekly earnings fell $8.49 to $723.32.

 

 

 

 

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Zapata expansion to add 35 jobs

Courtney Price on November 2014 at 11:45:00 am 
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Charlotte-based Zapata Inc. announced an expansion that is expected to create 35 jobs over two years. The architecture, engineering and construction management firm will grow its service areas, including additional locations in North Carolina.

The company will partner with LJB Inc., an engineering design firm based in Dayton, Ohio, to expand its public transportation engineering design services, according to a news release.

“Charlotte and other areas of North Carolina are in a pattern of tremendous growth,” Marty Ray, Zapata vice president of strategy and planning, said in a statement. “Our ability to support our communities and the state planners and engineers will be critical to North Carolina’s success for growing and attracting future investment.”

Zapata, which was founded in 1991 by former Duke Energy Corp. engineer Manuel Zapata, has mostly focused on federal work. This expansion represents a refocus on local and regional needs, according to the company.

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Rockingham County draws $58 million in investments

Courtney Price on November 2014 at 10:40:00 am 
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Rockingham County commissioners and Eden City Council members agreed this week to provide incentives for two companies – SGRTEX LLC and Gildan Activewear Inc. – that plan investments that total more than $58 million and will add 100 jobs.

Gildan Activewear, an apparel company based in Montreal, Canada, plans to expand its Eden distribution center by adding $12.7 million in machinery and equipment and $10.4 million in building improvements, as well as 16 full-time jobs, according to a news release. The center has 310 full-time employees.

SGRTEX, an India-based textile company, announced plans in May to open a yarn-manufacturing plant in Eden, investing nearly $35.4 million over two phases and creating 84 full-time jobs, according to the release. It will be the company's first U.S. plant.

SGRTEX will receive payments of $635,261  from the county and $555,853  from the city. The company will be paid the incentives over a period of four years. The county agreed to pay Gildan $448,719, and the city will pay $392,629, also over four years. The deals require the companies to meet investment and job-creation targets before incentives are paid. 

Rockingham County is in north-central North Carolina, bordering Virginia. Its county seat is Wentworth and largest cities are Eden and Reidsville. The county's population is about 94,000.

 

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BNC Bancorp expands into Virginia

David Mildenberg on November 2014 at 9:45:00 am 
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BNC Bancorp., the High Point-based banking company backed by Aquiline Capital Partners, is making its biggest expansion by buying Roanoke, Va.-based Valley Financial Corp. for about $101.3 million in stock.

The move expands BNC into Virginia, where Valley operates nine branches in Roanoke and Salem. Including the Virginia bank’s $857 million in assets, Bank of North Carolina will have assets of $4.9 billion. Pending approval from regulators and stockholders expected by the second quarter of 2015, BNC will be the fourth largest North Carolina-based banking company, behind Charlotte-based Bank of America Corp., Winston-Salem-based BB&T Corp. and Raleigh-based First Citizens BancShares Inc.

BNC is paying about 1.7 times Valley’s book value and about 16 times its earnings per share, according to a statement from the company. The valuation is in the mid-range of similar-sized bank acquisitions over the past year, according to SNL Financial LLC data.

BNC has made a dozen acquisitions since 2010 in North Carolina and South Carolina, and its stock has more than doubled in the past two years. Because of its success in managing those acquisitions, industry analysts have said BNC has the best growth prospects of North Carolina’s larger independent banks. ("Fresh crop," June 2014).

Valley Financial was started in 1995 and ranks fourth in deposit market share in Roanoke, trailing large rivals Wells Fargo & Co., SunTrust Banks Inc. and BB&T. Roanoke investor George Logan is Valley’s largest shareholder, with a stake of more than 10%, according to Yahoo Finance.

Aquiline owned 1.5 million voting shares, or 7%, according to BNC's 2014 proxy. The New York-based investment company also owns 4.8 million nonvoting shares, which are convertible into an equal number of voting shares, the proxy says.

 

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Demand on the rise for NC tech jobs

Courtney Price on November 2014 at 4:45:00 pm 
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North Carolina employers showed more demand for technology jobs in October, with 6.2% more job openings compared with September, according to a report from Raleigh-based The Select Group, a staffing and recruitment company.

After seeing a low point of about 3,000 average daily postings at the beginning of 2014, openings have exceeded 3,500 since June and increased to 3,780 last month. 

The most demanded job categories in October were: systems engineer/support (1,020 average daily postings), IT management (750) and software development (710). Most demanded skills included Java (830), SQL (760) and Windows operating system (610).

Labor demand from most sectors increased in October, according to the report, but financial services and banking had fewer job openings. The national average increased 0.5% in October. 

Source: The Select Group

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Wilmington attracts 1,300 jobs

David Mildenberg on November 2014 at 6:00:00 pm 
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Vertex Rail Technologies LLC plans to make rail cars for transporting crude oil at a Wilmington plant that will employ as many as 1,300 people.

Vertex plans to invest $55 million to renovate the plant, which previously housed a crane-manufacturing business operated by Westport, Conn.-based Terex Corp., according to a statement from Gov. Pat McCrory’s office.

Vertex said it well be hiring assemblers and fitters, welders, painters and others for jobs that will pay an average of about $40,000 annually.

Vertex Rail CEO Donald Croteau is managing director of Middleborough, Mass.-based Vertex FD LLC, a fabricating company that employed 30 and had annual revenues of $67 million in its 2013 fiscal year, according to a September 2013 story in the Taunton Daily Gazette in Taunton, Mass.

Vertex said the plant is needed because of increased demand for rail cars by crude-oil exploration companies in Texas, North Dakota and other states.

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Economic development board members named

David Mildenberg on November 2014 at 3:30:00 pm 
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The Economic Development Partnership of North Carolina announced its 17-member board of directors, including nine people appointed by the governor and four each named by House Speaker Thom Tillis and Senate President Pro Tempore Phil Berger.

John Lassiter, president of Charlotte-based Carolina Legal Staffing, is chairman of the board and the sole representative from Mecklenburg County. Four members are from Wake County, including Jim Whitehurst, CEO of Raleigh-based Red Hat Inc. The group holds its first meeting Friday, Nov. 21.

The nonprofit, public-private partnership develops new business prospects and works with the N.C. Department of Commerce, which retains responsibility for job-creation incentives and state funding decisions.

The members are:

  • Marie Flow Arcuri, dealer principal, Flow Lexus in Winston-Salem and Greensboro. (Forsyth)
  • Charles Creighton, founder and CEO, Colony Tire Corp. (Chowan)
  • Bill Graham, lawyer and partner, Wallace & Graham. (Rowan)
  • Michael Hawkins, president, Pisgah Enterprises. (Transylvania)
  • John Kane, founder and CEO, Kane Realty Corp. (Wake)
  • Vimal Kolappa, entrepreneur and founder, East Coast Hospitality. (Beaufort)
  • John Lassiter, president, Carolina Legal Staffing. Board Chairman. (Mecklenburg)
  • Thomas Looney, vice president and general manager, Lenovo North America. (Wake)
  • Pleas McMichael, retired textile executive and exporter. (Rockingham)
  • Melanie McNamara, founder and CEO, Absolute Style Furniture. (Guilford)
  • Caleb Miles, president and CEO, Convention & Visitors Bureau, Pinehurst/Southern Pines/Aberdeen. (Moore)
  • R. Doyle Parrish, CEO, Summit Hospitality Group. (Wake)
  • Sheila Pierce, executive director, Jacksonville Onslow Economic Development. (Onslow)
  • Robert Singer, lawyer and partner, Brooks Pierce McLendon Humphrey & Leonard. (Guilford)
  • Julie Spiro, executive director, Jackson County Chamber of Commerce. (Jackson)
  • Jeffery Turner, executive vice president and COO, Murphy Family Ventures. (Lenoir)
  • Jim Whitehurst, president and CEO, Red Hat. (Wake)
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Forbes ranks NC third best state for business

Courtney Price on November 2014 at 11:45:00 am 
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North Carolina moved up a spot to No. 3 in Forbes’ annual study of the best states for business for 2014.

Utah was No. 1 in the ranking, followed by North Dakota. Virginia, last year's top-ranked state, fell to fourth.

Forbes’ ranking looks at business costs, labor supply, regulatory environment, economic climate, growth prospects and quality of life. Business costs, which include labor, energy and taxes, are weighted the most heavily. North Carolina’s labor costs are 16% below the national average, Forbes reported. 

The state’s unemployment rate has declined from a peak of 11.3% in early 2010 to 6.7% in September, according to the U.S. Bureau of Labor Statistics.

Read more about the national rankings at http://onforb.es/1pR98r7

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LabCorp makes $6.1 billion acquisition

David Mildenberg on November 2014 at 9:45:00 am 
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Laboratory Corp. of America Holdings, the Burlington-based drug testing company with a stock market value of about $9 billion, is buying medical research firm Covance Inc. for $6.1 billion in cash and stock, the companies said today.

LabCorp. will pay $105.12 for each share of Princeton, N.J.-based Covance, 32% more than the company’s closing price on Oct. 31.

LabCorp. said the combined company will make research more efficient and deliver results from clinical drug tests more quickly. The headquarters will remain in Burlington, while the Covance division will be based in Princeton, headed by Covance Chairman Joseph Herring.

LabCorp. Is North Carolina’s 11th largest public company with a stock market valuation of more than $9 billion. Shares increased 20% this year through Oct. 31.

Jim Powell started LabCorp predecessor Biomedical Laboratories in 1969 after graduating from Duke University's medical school. Biomedical was acquired by Switzerland-based Hoffmann-LaRoche AG in 1982 and the company, later named Roche Biomedical Laboratories, became the nation’s largest provider of lab tests for hospitals and physicians’ practices ("False positive," September 1997). LabCorp was formed in 1995 after the sale of Roche Biomedical to National Health Laboratories Holdings of La Jolla, Calif.

Corning Inc. spun off Covance in 1996. The company had revenues of more than $2.6 billion last year.

 

 

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Linamar plans $115 million expansion near Asheville

David Mildenberg on October 2014 at 10:17:00 am 
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Linamar Corp. plans to invest $115 million in its Arden plant near Asheville with plans to add 150 positions, according to a statement from the Economic Development Coalition of Asheville-Buncombe County. The expansion stems from a new product line for the plant, which Guelph, Ontario-based Linamar bought from Volvo Construction three years ago. A building renovation will start this year with hiring expected to begin in early 2015, according to the release. The expansion follows a 2012 announcement of plans to invest $75 million and add 250 jobs at the plant.

Linamar plans to make transmission gears for the automotive industry at the plant, which now employs about 200 people who make engine blocks for customers including Peoria, Ill.-based Caterpillar Inc.

“Linamar’s success elevates Asheville’s growing reputation as a national leader in advanced manufacturing," Paul Szurek, chairman of the Asheville-Buncombe coalition, said in the statement. "There are only a few plants in the world that can produce products with such refined tolerances. We are extremely pleased Asheville has been selected for this project."

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Honda Aircraft announces $19M expansion in Greensboro

Cathy Martin on October 2014 at 3:00:00 pm 
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With sales of its $4.5 million jet looking promising, Honda Aircraft Co. announced a $19 million expansion at its headquarters at Piedmont Triad International Airport in Greensboro.

The first HondaJet aircraft, a light corporate jet that can carry up to seven passengers, is expected to obtain FAA certification in early 2015. It has logged more than 2,000 hours of testing at more than 70 U.S. locations.

The expansion will increase its total space to more than 680,000 square feet and brings Honda’s total capital investment to $160 million. It includes a 49,968-square-foot expansion of its headquarters and a 24,405-square-foot hangar. Construction is expected to be complete in the second half of 2015.

The company, founded in 2006 as a subsidiary of Japan-based Honda Motor Co., opened a 90,000-square-foot maintenance and service center in 2013. Its 250,000-square-foot factory opened in 2010.

In February, the company employed about 900 workers. Honda Aircraft employs more than 1,200 workers and expects to add 150 more before customers take delivery, according to its statement.

 

Click here to take a look inside Honda Aircraft's Greensboro operation.

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Nearly 500 new jobs for Greenville

Cathy Martin on October 2014 at 3:15:00 pm 
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DPx Holdings B.V. will invest $159 million in an expansion of its Patheon pharmaceutical manufacturing plant in Greenville and will create 488 jobs by 2019. Average annual salary for the new jobs will exceed $54,000, higher than Pitt County’s $39,845.

DPx was formed earlier this year when Durham-based Patheon combined with Dutch vitamin-maker Royal DSM in a $2.6 billion deal. The Durham-based company employs about 1,680 in the state, including more than 1,000 here, and about 8,000 at 20 locations worldwide.

The company will receive $6.3 million in state grants if it meets job creation targets.

DPx's CEO is James Mullen, former CEO of Biogen Idec Pharmaceuticals Inc., one of the world's largest biotech companies. Its management team includes Gary Shope, chief of staff to the DPx executive committee and a former officer of the Research Triangle Park Foundation.

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Cowell named among world's top pension officials

David Mildenberg on October 2014 at 5:30:00 pm 
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North Carolina Treasurer Janet Cowell’s resume got a nice boost with the Sovereign Wealth Fund Institute ranking her 18th on its list of the world’s 100 most influential public investors.

The New York-based group studies public pensions and sovereign wealth funds and bases its ranking on fund size, investment performance and industry trends.

Cowell ranked fifth among U.S. investment officials on the list, which was topped by André Bourbannais, global head of private investments at the Canadian Pension Plan Investment Board. She was the second-highest ranked woman.

Cowell oversees the North Carolina Retirement Systems, the nation’s tenth largest public pension with $90 billion in assets. It provides retirement benefits for more than 900,000 people, including teachers and state employees.

Cowell, who is an elected official, outranked chief investment officers of neighboring states, both of whom are in appointed positions. Ron Schmitz of the Virginia Retirement System, was 22nd, while Hershel Harper of the South Carolina Retirement System Investment Commission was 86th.

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Carolinas come up short on Forbes 400

David Mildenberg on September 2014 at 2:30:00 pm 
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The annual Forbes 400 listing of the richest Americans shows how poorly North Carolina and South Carolina stack up when it comes to the richest billionaires.

North Carolina has three people on the list: SAS Inc. co-founders James Goodnight and John Sall and Charlotte investor C.D. “Dick” Spangler Jr. South Carolina has one: Anita Zucker, widow of Charleston investor Jerry Zucker, who died in 2008.

Almost 60% of the wealthiest live in the four most populous states. California, a tech hub, is home to 93 billionaires on Forbes’ list. Finance center New York has 65, Texas, 39, and Florida, 31. Texas has gas and oil, Florida has beaches, and neither state taxes income or dividends, providing a whopping subsidy for the wealthy.

By comparison, Illinois, Ohio and Pennsylvania, the nation’s fifth, sixth and seventh most populous states, have a combined 25  on the list. They each have income tax rates of at least 3%.

To make Forbes’ list, one needed a net worth of $1.55 billion this year, versus $1.3 billion in 2013. Yes, the rich are getting richer.

Having billionaires in a community matters — just ask anyone responsible for raising funds for everything from venture capital to the local food bank. It’s an organic process and one can’t mint billionaires. But the concentration of wealth — and the ensuing power — in the four biggest states is not a positive trend.

     

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U.S. economic outlook solid, PNC forecasters say

David Mildenberg on September 2014 at 3:30:00 pm 
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Investors can sleep soundly, two senior forecasters at PNC Financial Services told the bank’s customers in Charlotte today.

The U.S. stock market has been on a roll for five years and “there’s nothing to point to suggesting this thing is coming to an end,” Bill Stone, chief investment strategist at PNC Wealth Management, told the group assembled at Quail Hollow Club.

Stocks are trading at fair value, neither expensive nor cheap based on historic standards, he said, adding that the past three bull markets have lasted six, eight and 10 years.

PNC expects the U.S. economy to grow by 2.2% this year, 2.9% in 2015 and 2.6% in 2016, according to a company report. Unemployment should decline from 6.3% to 5.3% over the next two years, said Bill Adams, senior international economist for the Pittsburgh-based company, which is the second-largest U.S. regional bank with assets of $327 billion.

The best historic indicator of a pending recession is the spread between the yields of 10-year Treasury bills and 30-year Treasury bonds, Stone said. The past four recessions occurred after the spread declined to less than zero. The current spread is about 0.70%, or 70 basis points.

PNC bought Royal Bank of Canada’s Raleigh-based RBC Bank USA for $3.5 billion in 2012.

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Three Charlotte women on power ranking

David Mildenberg on September 2014 at 5:00:00 pm 
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Three women based in Charlotte rank among the nation’s 25 most powerful bankers, according to an annual report by the American Banker trade publication.

Bank of America Corp.’s Cathy Bessant, global technology and operations executive, is rated seventh, while Laura Schulte, president of eastern region community banking at San Francisco-based Wells Fargo Corp., is 19th. Andrea Smith, global head of human resources at Bank of America, is 22th. Bank of America is based in Charlotte, though the bank's CEO, Brian Moynihan, lives in Boston.

According to the trade publication, Bessant has more influence than Bank of America’s Anne Finucane, global chief strategy and marketing officer, who is 13th. She is based in Boston

Bessant told the publication her recently completed stint as president of the Foundation for the Carolinas helped her handle the stress of the financial crisis. The Charlotte-based community foundation had assets of $1.4 billion on July 31. "During the toughest years in banking I would have been lost if not for the offset of my civic work," she says. "Imagine the opportunity to go every other month and sit with important, caring, inspirational people. What a rejuvenation."

 

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Charlotte software company to create 603 jobs

Cathy Martin on September 2014 at 1:00:00 pm 
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AvidXchange, a Charlotte-based software company, said it will quadruple the size of its local workforce, adding 603 jobs to its existing 200 by the end of 2018.

Founded in 2000, the company provides automated accounts-payable systems to small- and mid-sized businesses.

The company will invest $21.4 million in a new, 115,000-square-foot headquarters at the NC Music Factory in uptown Charlotte.

The new jobs will pay an average annual salary of about $61,651, slightly higher than Mecklenburg County's $59,046, according to a press release from Gov. Pat McCrory's office.

“AvidXchange is deeply rooted in the Queen City, and as we continue to prosper, it is important for us to grow and contribute to the city that has supported us from our days as a small startup to the Inc. 5000’s 20th fastest-growing company in the Charlotte metropolitan area," CEO Michael Praeger said in the release.

AvidXchange employs more than 300 people in North Carolina, New Jersey and Georgia.

"The direct and indirect impact felt to our local economy as a result of the more than 600 jobs created will be significant,” Bob Morgan, Charlotte Chamber president and CEO, said in a statement.

The company could receive more than $7.5 million over 12 years from the state's Job Development Investment Grant program if it meets job creation goals.

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Raleigh clinical trials company plans IPO

David Mildenberg on September 2014 at 1:00:00 pm 
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Raleigh contract research organization PRA Health Sciences Inc. filed for a $375 million public offering, a year after Kohlberg Kravis Roberts & Co. LP bought the company for $1.3 billion.

PRA, one of the largest clinical trials companies in the world, reported a $14 million loss on $712 million in revenue during the first half of 2014. KKR owns 99% of the shares after buying PRA in 2013 from Genstar Capital LLC, a San Francisco-based private equity company.

The company has 10,000 employees in more than 80 countries, running trials on experimental drugs for pharmaceutical companies.

PRA CEO Colin Shannon is a former executive at Wilmington-based Pharmaceutical Products Development LLC. He was paid $8.8 million last year, according to the IPO filing. Chief Financial Officer Linda Baddour, also formerly of PPD, received $5.86 million.

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The Facebook effect: $707 million in NC

Cathy Martin on September 2014 at 3:00:00 pm 
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Facebook Inc.'s Forest City data center, which employs fewer than 100 people, has had a $707 million economic impact since the Menlo Park, Calif.-based company started construction in 2010, according to a report prepared by Research Triangle Park-based RTI International. Much of the benefit stemmed from construction spending of $526 million, which includes data-center equipment, software and infrastructure at the 800,000-square foot facility that is about 75 miles west of Charlotte.

Forest City is one of three locations in the world where Facebook stores billions of photos, videos and comments from users. Other sites are in Prineville, Ore. and Lulea, Sweden, while a fourth is under construction in Altoona, Iowa.

The social-network service provider spent $17 million in operating expenditures in 2013, which supported 310 jobs and had a total statewide economic impact of $27 million.

Western North Carolina is home to other large data centers such as Google Inc. in Lenoir and Apple Inc. in Maiden, all drawn by the region's plentiful supply of electricity and relatively low costs.The Facebook site once housed a Burlington Industries Inc. textile mill and later, a boat manufacturer.

In July, Facebook announced a partnership with Tryon-based PANGAEA Internet and Rutherford County to provide free Wi-Fi access to homes of about 100 students in Forest City, where more than a third of residents had income below the federal poverty level between 2008 and 2012.

The company also has issued $450,000 in community grants to Rutherford County schools and nonprofits since 2011.

 

 


Read more here: http://www.charlotteobserver.com/2014/04/16/4846009/a-peek-inside-the-nc-data-center.html#storylink=cpy

 


Read more here: http://www.charlotteobserver.com/2014/04/16/4846009/a-peek-inside-the-nc-data-center.html#storylink=cpIn July, Facebook announceda partnership with Tryon-based PANGAEA Internet and the local government to provide free Wi-Fi access to homes of about 100 students in Forest City, where more than a third of residents had income below the federal poverty level between 2008 and 2012The company also has issued $450,000 in community grants to Rutherford County schools and nonprofits since 2011.

 

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Four energy companies to build $4.5 billion pipeline in NC, Virginia

Cathy Martin on September 2014 at 10:17:00 am 
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Dominion Resources, Duke Energy and two other energy companies will construct a 550-mile pipeline that could create thousands of construction jobs and bring 1.5 billion cubic feet of natural gas per day from shale basins in Pennsylvania, West Virginia and Ohio to North Carolina and Virginia.

Atlantic Coast Pipeline LLC is a joint venture of Richmond, Va.-based Dominion, Charlotte-based Duke Energy, Charlotte-based Piedmont Natural Gas and Atlanta-based AGL Resources.

The $4.5 to $5 billion pipeline will run from Harrison County, W. Va., to Robeson County. Pending regulatory approval, construction could begin in 2016 with service beginning by late 2018. The pipeline would transport natural gas from the Marcellus and Utica shale regions to the utilities, which are reducing their use of coal-fired power plants.

The construction phase of the project is expected to create 738 jobs per year in North Carolina and will have an economic impact of $680 million, Gov. Pat McCrory said in a statement

Dominion will have a 45% ownership stake and will build and operate the pipeline. The company, which provides electricity to more than 120,000 customers in northeast North Carolina, operates about 8,000 miles of pipeline in six states.

“The Atlantic Coast Pipeline is a transformational project for our region," the companies said in a joint statement. "It will create thousands of construction jobs during development and significant new revenue for state and local governments throughout North Carolina, Virginia and West Virginia. The expanded source of gas will also help fuel economic development across the region as businesses and homes rely more on natural gas."

Duke Energy will have a 40% ownership stake, while Piedmont and AGL Resources will own 10% and 5% respectively.

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Are State Treasurer Cowell and the Bowles too cuddly?

David Mildenberg on August 2014 at 6:00:00 pm 
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North Carolina’s $90 billion state pension is getting lots of attention this week, including a two-part series by Charlotte public radio station WFAE on why State Treasurer Janet Cowell is so fond of alternative investments and collecting campaign funds from New Yorkers with Wall Street ties. The series repeats previous criticisms of Cowell’s strategy, which has boosted state spending on hedge funds and investment groups that specialize in more complex strategies than traditional stock-and-bond investing.

Separately, the cozy relationship between Cowell and Charlotte business icons Erskine and Crandall Bowles was highlighted by International Business Times, a New York-based website affiliated with Newsweek magazine.

Charlotte-based Carousel Capital, which Erskine co-founded, got a contract in 2011 to manage money for the N.C. Innovation Fund, a $232 million state-sponsored investment fund overseen by the state treasurer, only weeks after a fundraiser for Cowell’s 2012 campaign was held at the Bowles’ Charlotte home. Such a fundraiser isn’t too surprising because the Bowles generally support Democrats such as Cowell. But Securities and Exchange Commission rules restrict campaign contributions from companies that manage public pension funds, including Carousel Capital and JPMorgan Chase, where Crandall is a director.

Erskine Bowles told the International Business Times he hasn’t had a role in raising funds for Carousel Capital since 2005 and hasn’t talked to North Carolina or anyone else about investing in the firm during that period. Crandall Bowles, former CEO of the Springs textile empire and the party’s host, didn’t comment. The money apparently helped Cowell, who won about 54% of the vote during her elections in 2008 and 2012, while Republicans gained control of North Carolina politics.

For a balanced perspective on all of this pension-fund talk, check out Andy Silton’s blog. He’s a former chief investment officer for North Carolina and offers an insider’s view of how public pensions work. One interesting point he makes: the State Employee Association of North Carolina slams Cowell for putting 22% of state pension fund into distressed debt, real estate and other alternative investments, up from less than 10% five years ago. Had she put the money in a U.S. stock index fund, instead of messing with all those costly Wall Street and Tryon Street sharpies, the fund would be billions richer, SEANC argues.

But SEANC doesn’t mention that over the past 15 years, including the recent bull market, stocks returned 5% annually vs. 6.9% for bonds. “If we’d followed SEANC’s prescription (even with index funds) over the past 15 years, the state’s pension plans would be in a very deep hole,” Silton notes. He doesn’t fault Cowell for trying something new.

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Fayetteville's recovery from recession among fastest in U.S.

Cathy Martin on August 2014 at 5:00:00 pm 
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Fayetteville recovered faster from the Great Recession than all but two other U.S. cities, according to a survey by personal-finance website Wallethub.com. The city's economy is buoyed by Fort Bragg, the nation's largest Army installation and home to about 57,000 soldiers, according to the Associated Press.

Raleigh ranked No. 10 on the survey of 150 cities, while Durham was No. 22. Greensboro and Winston-Salem were Nos. 84 and 87. With much of its economy tied to the finance industry, which has taken longer to climb out of the recession, Charlotte ranked lowest among North Carolina cities included in the survey at No. 98.

The survey considered 18 metrics including unemployment rates, median household income growth, and increase in the number of college-educated workers moving to the area, to measure which cities experienced the most economic growth since the recession ended in June 2009.

Fayetteville also had the largest decline in the ratio of part-time to full-time jobs.

 

 

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NC exports top $15 billion in first half of 2014

Cathy Martin on August 2014 at 5:00:00 pm 
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North Carolina exports topped $15 billion during the first half of 2014, an increase of 2.7% over the same period in 2013, according to a press release from Gov. Pat McCrory's office.

“Exports have not only increased for our traditional industries, such as textiles and food, but also for many of our newer industries as well,” said Sharon Decker, secretary of the N.C. Department of Commerce.

One of the new industries is wood pellets, benefiting after the European Union mandated that 20% of the region's energy come from renewable sources by 2020. Six wood-pellet production plants are now open or in development, including four owned by Bethesda, Md.-based Enviva LP, which is also constructing two storage domes at Port of Wilmington.

In our July issue, contributing writer Lee Weisbecker examines this growing industry, which environmentalists view as a threat to North Carolina woodlands.

Click here to read the article.

 

 

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Canton paper mill wins incentives from state

David Mildenberg on August 2014 at 5:00:00 pm 
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The billionaire owner of the Canton paper mill, a bulwark of western North Carolina’s economy for more than a century, got his state aid after lawmakers in Raleigh reversed course in less than 24 hours. Graeme Hart of New Zealand, who bought the mill in 2006 for $500 million and renamed it Evergreen Packaging, sought $12 million over six years to help pay for modernized boilers that burn more natural gas and reduce coal use to meet new federal rules on emissions. The plant provides more than 1,000 jobs with average annual compensation of more than $78,000. A bill enabling incentives was approved today, after another bill, which also included assistance for Evergreen, was defeated yesterday."It's a small insurance policy for a company that has a $100 million annual impact," says state Rep. Nathan Ramsey, a Fairview Republican who voted for the bill.

Champion Fibre and its successor entities ran the mill for decades until selling it for $200 million to an investor group, which included employees, in 1999. Upgrading boilers will cost up to $44 million, which would have no adverse impact on its finances, according to Evergreen’s 2013 annual report. “We’re afraid [Hart’s] going to say, ‘I’ve had enough of this,’ and just shut it down,” says Sen. Jim Davis, a Republican from Franklin who voted for the bill. Hart, who spent more than $16 billion assembling a packaging empire the past decade and is often called New Zealand’s richest man, may sell as much as $7.9 billion of assets, according to a July government filing. Talk around Canton is that Koch Industries’ Georgia Pacific might buy the plant, former Mayor Pat Smathers says. Evergreen officials didn’t return telephone calls. Georgia-Pacific had no comment. 

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Just appreciate, baby!

Spencer Campbell on August 2014 at 1:30:00 pm 
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Complain all you want about its concussions, its tin-eared commissioner and its players who carry more guns than common sense — the NFL is doing just fine, thank you very much. Forbes released its annual ranking of most-valuable NFL franchises today, and 25 of the league’s 32 teams are worth more than a billion dollars. North Carolina has 36 public companies worth that much.

Last year’s Carolina Panthers, which posted a 12-4 record and won the NFC South, secured the franchise’s first playoff spot since 2008. That earned Carolina an 18% increase in value, from $1.05 billion to $1.25 billion. It improved one spot on the list, climbing to 17th. Also important to the pocketbook of Jerry Richardson — whose ownership group paid just $200 million for the expansion team in 1993 — is that though annual revenue grew only 4.4% to $283 million, operating income nearly doubled to $56 million.

But the Forbes list proves the business of the NFL is about more than winning, with all apologizes to late Oakland Raiders owner Al Davis. The Dallas Cowboys, which haven't been relevant since Troy Aikman was under center and were a middling 8-8 for the third-straight year in 2013, are evidently still America’s favorite team, worth a staggering $3.2 billion, 39% more than last year. Its operating income is only about $40 million less than the Panthers’ revenue.

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Florida attracts BofA biggie

David Mildenberg on August 2014 at 11:00:00 am 
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David Darnell’s move to Florida costs Charlotte its top-ranking Bank of America executive. But why don't more wealthy Tar Heels retire to the Sunshine State, where the temperature is high and the taxes low?

Darnell, 61, is a Charlotte native, Wake Forest University grad and ardent supporter of his hometown, having served as chairman of the Charlotte Chamber. He’s also regarded within the bank and community as a genuinely nice guy. BofA's North Carolina-based leadership team has dwindled since Brian Moynihan replaced Ken Lewis Lewis as CEO in 2010. Most of its key decision-makers now work in New York. However, Charlotte boosters could always point to Darnell, formerly co-COO, as evidence that Moynihan, who lives near Boston, hasn't turned his back on the bank's headquarters city.

That's a tough sell, now that Darnell will become a vice chairman based in Tampa and is no longer equal to COO Tom Montag, a former Goldman Sachs executive who oversees investment banking from New York. Darnell retains responsibility for business banking and wealth and investment management.

Darnell’s Merrill Lynch wealth advisers might recommend a move to Florida for tax-planning purposes. The Sunshine State doesn’t tax personal income, while North Carolina’s tax rate for the highest earners is 5.8% this year and 5.75% next year. His compensation has averaged about $9 million a year over the past three years, so living in North Carolina can cost income-earners at Darnell’s level a half-million dollars a year. Darnell owns a home near Bradenton, Fla., 45 miles south of Tampa, according to property records. "David’s decision was based on a desire to relocate with his family to Tampa and still provide strategic leadership to the company," bank spokesman Tony Allen says. "Nothing more than that."

The state has no way of tracking how many residents move to Florida for tax reasons, says Trevor Johnson, a spokesman for the N.C. Department of Revenue. It’s an impossible stat to gather because many motivations prompt moves, says Richard Borean, spokesman for the Washington-based Tax Foundation. But U.S. Census Bureau statistics rebut the idea of a surge of Tar Heels heading south. About 53,000 more Floridians moved to North Carolina between 1993 and 2010 than vice versa, according to the Tax Foundation.

 

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Canadian manufacturer bringing 68 jobs to Scotland County

Cathy Martin on August 2014 at 4:00:00 pm 
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Cascades Tissue Group will invest $62 million and create 68 much-needed jobs over three years in a manufacturing plant in Scotland County, which had the highest unemployment rate in North Carolina in June at 12.1%. Based in Kingsley Falls, Quebec, Canada, the company makes recycled paper towels, tissues and napkins. Started in 1964, Cascades employs about 12,000 workers at more than 100 locations in North America and Europe, including 178 at plants in Kinston and Rockingham. Salaries will vary, but will average about $47,000 annually, 47% higher than Scotland County's average according to a press release from Gov. Pat McCrory's office. The company will receive up to $402,000 in grant money from the One North Carolina Fund if it meets job creation and investment targets.

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Best-performing N.C. stocks

David Mildenberg on August 2014 at 4:00:00 pm 
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The best North Carolina-based stocks to own over the past five years were mostly companies in traditional, less-than-sexy industries, according to Business North Carolina’s annual ranking of the Top 75 public companies in the state.

Raleigh-based Salix Pharmaceuticals Ltd. (ticker: SLXP) topped the list, increasing more than tenfold since June 2009 on increased acceptance of its drugs, which treat gastrointestinal illnesses. Other big gainers included companies with popular brands such as Greensboro-based VF Corp. (VFC) and Hanesbrands Inc. (HBI) and Krispy Kreme Doughnuts Inc. (KKD), both based in Winston-Salem. Each rose more than fourfold. Old Dominion Freight Line (ODFL), based in Thomasville, jumped 327%, while manufacturers Enpro Industries Inc. (NPO) and Carlisle Cos. (CSL), both in Charlotte, gained 306% and 276%, respectively.

In comparison, Bank of America Corp. (BAC) increased 18% during the five-year period, while the S&P 500 Index more than doubled.


See the top performers here.

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Dollar General weighs bid for Family Dollar

Cathy Martin on August 2014 at 6:00:00 pm 
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Dollar General Corp. is considering a bid for Matthews-based Family Dollar Stores Inc., according to a Bloomberg report.

Chesapeake, Va.-based Dollar Tree announced July 28 it would pay $8.5 billion − $74.50 a share − for the discount retailer. Family Dollar's stock has been trading at or above that price since the announcement.

Goodlettsville, Tenn.-based Dollar General is currently the No. 1 dollar-store chain by number of stores. A combined Family Dollar and Dollar Tree would overtake the top spot.

Investor Carl Icahn, who took a 9.4% stake in Family Dollar in June (Under Fire, July 2014), aggressively pushed for a sale of the company, then dumped more than half of his shares after the Dollar Tree deal was announced.

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