Wait Till We Get Our Globalization On You

Hanesbrands Inc., the maker of Hanes ("Wait Till We Get Our Hanes On You"), Champion, and Wonderbra (among other inner and outerwear) is closing nine facilities and firing around 5,300 U.S., Canadian, Puerto Rican, Dominican, and Mexican employees, in order to continue its globalization "cost reduction strategy."

The move, announced Wednesday, will concentrate bra sewing and manufacturing to lower-cost countries in Central America and Asia. The company is continuing the process it began last year, when it separated from Sara Lee Corporation. One of the facilities is a manufacturing plant in Statesville, NC, which will lose 70 jobs. Just last month, Hanesbrands closed another plant in Statesville, firing around 140 people. In Winston-Salem, at the company's corporate headquarters, 260 management and administrative jobs will be eliminated.

In the past year, the company has announced plans to eliminate 10,300 jobs and close 15 factories.

Sources: Hanesbrands, The Toronto Star, Winston-Salem Journal

Having cake, and eating it too

This post is dedicated to Michelle, and her attempt to keep Business Facilities' facility full of cake and cookies.

-Celebration Foods, the company that produces Carvel ice cream cakes and other desserts, will be relocating its sweet headquarters and manufacturing operation to New Britain, Connecticut. The $16.3 million facility is expected to generate 225 jobs, bringing Celebration's plants in Maryland, California, and Massachusetts under one roof. Centerplan Development Co. broke ground this month on the 13 acre site, which they will rent to Celebration.

The city and state Department of Economic and Community Development offered the company a $1 million grant and a five year, 80% discount on real and personal property taxes.

-While on the topic, the town of Brookhaven, New York is sounding very delicious. Tate's Wholesale, a national distributor of gourmet baked goods, relocated its manufacturing facilities to a 27,000-square-foot facility this month. The move represents a major move Brookhaven, which created the first "floating Empire Zone" for the company, allowing Tate's to be eligible for wage tax credits and other benefits. The company plans to create 50 jobs.

Sources: The Hartford Courant, Newsday

IBM Smells the Roses

Following its announcement last month that it will dedicate $1 billion per year to reducing energy consumption (Project Big Green), IBM 's newest expansion will officially be a green one. The computer company is dropping a cool $86 million into a green data center in Boulder, CO.

The expansion will add 80,000 square feet of space by next April. The new facility will reduce energy costs for IBM and its clients by using recycled materials for manufacturing and increasing virtualization use and overall computing density.

IBM has also been awarded incentive funding by both the state of Colorado ($632,000) and the city of Boulder (a $100,000 rebate program).

IBM has over eight million square feet of data center space worldwide. Project Big Green aims to double IBM's data center capacity by 2010 without increasing energy use. Sun and HP are also vowing to green their data center operations. In the expansion announcement, TechSpot.com wrote:

Power concerns are huge, and more companies are seeing it better, for both public relations and ultimately for business, to work "green."

Sources: TechSpot, IBM, Commercial Property News, ComputerWorldUK

Hype It Up, Hire It Up

Apple Computer's newest innovation, the iPhone, is not being released until June 29th, however with all of the media hype surrounding the launch, it's expected to generate a significant demand once it hits shelves.

AT&T, the exclusive iPhone retailer, (outside of Apple) expects to generate wireless subscribers through the launch. The phone company announced yesterday that it had hired 2,000 temporary store workers for its 1,800 stores in anticipation. Apple will also be selling the iPhone at all of its 162 U.S. store locations.
Foxconn and Quanta Computers, both manufacturers based in Taiwan, are rumored to be the Apple's iPhone manufacturers, not to mention all of the other manufacturers of various components in the iPhone supply chain, from factories in Singapore and the U.S. to Apple's assembly plant in China.

The phone combines a music and video player with a web browser and, of course, a phone. The design is Apple's trademark: simple, clean, and very usable. The phone will initially cost consumers between $499 and $599.

The Indianapolis Star reported yesterday that Gene Munster, who covers Apple for investment firm Piper Jaffray, says the iPhone could nearly double the size of Apple within two years. Apple revenue is now at $24 billion, and he projects iPhone sales could push that to $42 billion - including $15 billion in iPhone sales - by 2009.

Sources: Forbes, Business Week, Reuters, macnn, Apple Computer, AT&T, Shmula, The Indianapolis Star

Toyota Done Building U.S. Plants?

Did you catch this one on column three above the fold on the front page of today's Wall Street Journal? You need to be a subscriber to read it online, but the basic thrust is this: Toyota's building of assembly plants in the U.S. may be at an end, for now. The plants have scored political points for the company as it ascends to the dominant world position in automobiles, but it may be facing excess capacity in U.S. factories. Furthermore, the factories in the U.S. are not configured to be as flexible as some of its factories in Japan, which can produce more than six vehicle models, as opposed to one or two per plant in the U.S. And the most interesting fact: right now, it is cheaper for Toyota to build a car in Japan and export it here than it is to build it here (thanks largely to the weakness of the yen versus the dollar).

Green Machine

When I think of summer the first three things that come to mind are Saturdays at the beach, ice cream, and...higher gas prices.

Being a big fan of the whole push towards a "greener," cleaner energy culture, I was delighted to hear last week that Toyota's global sales of hybrid vehicles have hit a record 1 million as of the end of May. Of those, nearly 345,000 hybrids were sold in Japan, while 702,000 were sold abroad, according to a statement released by the company last week. Sales of Toyota hybrids have climbed from just 18,000 in 1998 to 312,500 last year. Concern over gas prices, global warming, and pollution have all helped to drive the demand for hybrids.

The Prius is the clear winner when it comes to hybrids, with a total of 757,600 units sold since its 1997 introduction in Japan. Toyota began selling the Prius in North America, Europe, and other places in 2000. Last year, the model made up more than 40% of hybrid sales in the U.S.

And on another green energy note:
State Reps. Kate Ebli, D-Monroe, and Kathy Angerer, D-Dundee, unveiled a plan this past Monday aimed at making Michigan a leader in the renewable energy production arena, which should help attract cutting-edge industries and boost the state's economy.

The plan involves increasing tax incentives for alternative energy, offering tax breaks for individual households employing the alternatives and protecting the Great Lakes and Michigan's other natural resources. Some of the ideas are similar to those proposed earlier in the year by Governor Granholm or Michigan Public Service Commission leader J. Peter Lark.

"With our highly skilled workforce and our outstanding universities, our state is in an ideal position to become a key player in the renewable energy sector," Rep. Angerer said. "Michigan gave birth to the auto industry, and Michigan will pave the way for this renewable energy economy."

House Democrats' 21st Century Renewable Energy Plan will:
¥ Require that renewable energy sources (such as solar, wind, hydroelectric and biomass-based power) account for 10% of the state's energy production by 2015. The plan sets a goal of 25% by 2025.

¥ Foster more "alternative-energy renaissance zones" across the state by including solar and wind generation and fuel-cell technologies among those who qualify for renaissance zone tax abatements.

¥ Promote energy conservation through updated construction codes and consumer tax credits for energy-efficient appliances.

¥ Provide tax credits for the purchase of solar equipment.

¥ Establish a statewide target of reducing electricity consumption by 1% a year.

House Democrats also will be examining ways to expand programs at community colleges to train workers to maintain new renewable-energy technologies.

A program focused on renewable energy and energy efficiency would create tens of thousands of new jobs and pump hundreds of millions of dollars into Michigan's economy, according to a recent NextEnergy study prepared for the Michigan Department of Environmental Quality.

The House Democrats said the points of the plan will be introduced as bills soon. The Energy and Technology Committee and the Great Lakes and Environment Committee, both of which Rep. Ebli sits on, likely will hear the bills in the next few weeks. We'll keep you posted!

Where there is sea, there are pirates, Part 3

Pirates attacking off the coast of Somalia are now using satellite phones and GPS devices to track their prey. The technology is making it easier to find and overpower large container and cargo ships. Crucial shipping lanes pass through Somali waters, allowing for the trade of oil, gas, and cargo throughout the region. So far this year, at least 10 pirate attacks and many more attempted attacks have occurred off of Somalia's 2,300-mile coastline.

"We prefer hijacking ships to being on land because that way we can feed ourselves," said Somalian pirate Abdulahi Hasan Afdhub to a French journalist via satellite phone from a hijacked Taiwanese ship.

Pirates took control of the boat, a fishing vessel, earlier this month, killing one crew member and holding others hostage. The boat is one of five known vessels that are currently being held by Somali pirates, all attacking on speedboats mounted with machine guns, rocket propelled grenades, and AK-47s.

Aside from the cargo, pirates on board (via satellite phone) or accomplices on the ground negotiate a minimum of $25,000 for an empty boat and $400,000 for a fishing vessel with a catch on board. Merchant vessels tend to go even higher. Earlier this year, Somali pirates held a boat for four months, eventually negotiating $2.5 million. The pirates only see a fraction of the spoils, however. Only five leaders (possibly local warlords) are thought to control all of the piracy operations along the Somali coastline.

Somalia, which is located in the horn of Eastern Africa, has had no official government since 1991, and most of the ransom funds are thought to arm local militias. The International Maritime Bureau has declared the Somalia coast to be one one of the most dangerous stretches of water in the world.

Sources: The New York Times, The Mail & Guardian, The Peninsula Online,

Also check out: Where there is sea, there are pirates, Part 1 and Part 2

Arabian Pathfinders

Arabian Automobiles Company, one of the largest automobile distributors in the Gulf and the sole distributor of Nissan, Infiniti, and Renault in the Northern Emirates, announced today that they will invest over $136 million over the next three years to expand its sales and services facilities in and around Dubai. The company, which is owned by AW Rostamani Corporation, will construct its largest logistics facility on three million square feet in Dubai Industrial City, with the capacity to hold 12,000 cars. The facility will cost $95.3 million.

The firm's goal is to capture at least 25% of Dubai's local car market by 2010.

In 2006, 236,515 cars were sold in the United Arab Emirates, an increase of 23 percent over 2005. According to Arabian Automobiles statistics, the sales of Japanese cars between January and April of 2007 grew 32.3 percent compared to the same period last year.

Despite political tensions in the Middle East and the rising cost of living in Dubai, the auto market is hot. At least Arabian Auto is banking on it.

Sources: Middle East North Africa Financial Network (Jordon), AW Rostamani/Arabian Automobiles, AME Info, Gulf News

English Midlands Calling

The British Midlands Development Corporation's Bridge to Growth is an aggressive marketing program aimed at attracting U.S. companies to central UK with various incentives, including free incorporation services, free advice and market analysis, free banking service, and free office accommodations.

The latest press release quoted Christopher Jones, VP of the British Midlands Development Corporation:

By participating in the Bridge To Growth program, small and medium-sized firms can avoid much of the start-up costs associated with opening an office in a new geography. The Bridge To Growth program allows firms to focus on growing sales from the first day that they land in the U.K. market. The program is essentially a package of services from expert organizations who manage the legal, financial, and administrative aspects of running a business in the UK.

Considering relocating to the British Midlands? Don't worry about going there just yet. Bridge to Growth representatives are probably coming to sell the program in a city near you. Now that's aggressive marketing.

Sources: Bridge to Growth, British Midlands Economic Development,

CoreNet Global Bans Site Publications From Fall Show

From the Publisher of Business Facilities:

An association is defined as an organization of people with a common purpose and formal structure. Synonyms of the word include alliance, union, society, company, band, and fellowship.

I was thinking of this definition the other day when word filtered out that the CoreNet Global Association is disallowing the core economic development/site publications--Business Facilities, Site Selection, Area Development, and Expansion Management--from exhibiting at the CoreNet Global Summit biannual trade shows in the U.S. At the crux of this decision is CoreNet's desire to capture a larger share of advertising in their own economic development publication, CoreNet Leader, which they have been publishing for six years now. Surely part of the decision was also that each of the "Big Four" site publications created their own events that have seen some success in the corporate real estate marketplace.

You see, CoreNet Global views the traditional site publications as competition. CoreNet Global does not want the media cavorting with its clientele at their CoreNet Summit events. Unfortunately, they just don't get it. CoreNet Summit isn't their event; it belongs to the entire real estate community--which includes the media. The media represents a very big part of the corporate real estate community, while the publication CoreNet Leader only represents one viewpoint.

CoreNet Global has ceased to act like an association for some time now. They have never collaborated with the media and have generally acted more like a for-profit group than a non-profit. The CoreNet Summit events have declined in relevance for several years now. If CoreNet Global continues to behave as a for-profit entity and a clandestine organization, then no one should support their efforts--and their claim as the association representing our marketplace will end.

The New Color of Luxury

Starwood Capital Group announced today that it will open New York City's first five-star green hotel as part of a 31-floor mixed-use building in Manhattan. The building will feature approximately 100,000 square-feet of hotel and 86,000 square feet of residential condominiums.

Last October, Starwood announced that it would be launching the first luxury, eco-friendly global hotel brand: "1" Hotel and Residences. The purpose is to demonstrate that green principles can coexist with and enhance a luxury experience. In fact, the Natural Resources Defense Council has agreed to be Starwood's advisor on the project.

Barry Sternlicht, CEO of Starwood Capital Group, says:

Today marks an important step in the development of what I believe will truly become a revolutionary force for change in the hospitality industry.

The building will be LEED certified by the U.S. Green Building Council, and will feature extensive use of high-recycled and locally procured materials and half of all energy used will come from renewable sources such as wind and hydroelectricity. The "1" in New York will donate one percent of profits to local environmental organizations.

Other hotels under the "1" brand are being planned for Seattle, Scottsdale, Arizona, Ft. Lauderdale, Mammoth Lakes, CA, Washington D.C., and Paris.

Hopefully green operations will not only become a luxury and hospitality industry standard, but a standard for all industry.

Sources: EarthTimes, 40th Street Development, Starwood Real Estate, Natural Resources Defense Council

A Dubai on the Atlantic?

Have you heard of "the new Dubai"? It seems like a contradiction in terms, considering that Dubai City itself is quite new (before 1971, there were no signs of that city on the Arabian Peninsula).

However, the "New Dubai" that I'm referring to is what the Senegalese government is calling its new capital, which will be located 150 kilometers North of Dakar, the present capital.

The city does not exist yet. On this remote stretch of coast, called Lompoul, Senegalese President Abdoulaye Wade envisions a $30 billion "Dubai on the Atlantic," also called W.D.C. by its planners. Dubai World, the original Dubai's state holding company, will begin construction in Senegal next year.

The story was reported today, however a group of Gulf developers met with the Senegalese President this April in Dubai (the "old" Dubai) to discuss the "new administrative city" that was to be developed. Among the UAE business people in discussions were members of Dubai World as well as Tameer, a.k.a. Al Khaleej Development Company, which is also developing a $20 billion city in Libya.

President Wade's election in 2000 ended four decades of socialist rule, and since then has made Senegal attractive to foreign investors. However, he has faced criticism for not doing enough to end poverty and unemployment. Thousands of Senegalese people continue to risk their lives every year trying to reach Europe, and currently over 40% of the population is unemployed.

Reuters reported an interview with Ahmed Khalifa Niasse, the minister leading the project:

"In three years, the central government will no longer be in Dakar, but in the new capital. In the first two years, we expect 200,000 people to come, and three years later, 2 million. . .We think this new Dubai can be more attractive than the Dubai in the Gulf."

Senegal, a French-speaking country in West Africa, will model its new city on Maghreb styles, designed by a Parisian Architect. Plans for the city include Africa's first high-speed train linking Lompoul with Dakar, an eight lane toll road, and a Formula 1 circuit. Currently there are no direct flights from Senegal to anywhere in the Dubai area, which will change by 2008.

Sources: Reuters (Alertnet), Reuters (Africa), Overseas Property Mall

Massachusetts' Thick Skin

Organogenesis Inc. announced plans to build a new headquarters and factory in Massachusetts, adding over 300 high-skilled jobs. The company, which makes artificial skin called Apligraph, plans to build a new 250,000-square-foot complex within 15 miles of its current Canton, MA headquarters.

Organogenesis had been planing to expand its operations outside of Massachusetts, but was lured by the state's incentives and Life Sciences Initiative. Massachusetts will provide $12.9 million in grants and infrastructure support, as well as $5 million in low interest loans, to the company. The Boston Globe reported today that "with biotech companies and other life-science businesses riding a wave of job growth and financial success, Massachusetts is competing with other states to lure and keep companies." Governor Deval Patrick announced that the company's decision to remain in MA was the first victory since the announcement of Massachusetts's $1 billion life-sciences strategy last month.

The artificial skin that Organogenesis produces is made from live human cells (apparently from infant foreskin) and cow collagen. Doctors place the grafts on diabetic ulcers and other wounds.

Sources: The Boston Globe, Organogenesis, Metropolis