INSIGHT ON: Economic Development – A powerful surge

Posted on Apr 1, 2015 :: Economic Development , Insight On
Sean P. Johnson
Posted by , Insight on Business Staff Writer
Wisconsin AG Center – An artist’s rendering of the Wisconsin Agriculture Education Center proposed along Interstate 43 in Manitowoc County. The $10 million to $12 million center has been projected to attract up to 500,000 visitors a year. Photo courtesy WEAC

Wisconsin AG Center – An artist’s rendering of the Wisconsin Agriculture Education Center proposed along Interstate 43 in Manitowoc County. The $10 million to $12 million center has been projected to attract up to 500,000 visitors a year. Photo courtesy WEAC

There is a definite thaw in Manitowoc County and it has nothing to do with ice on the lake.

This latest trend has very little to do with the unpredictable Wisconsin weather. No, this warming applies to the regional economy, which is seeing several years’ worth of initiatives finally coming to fruition as new projects take off and old scars begin to fade.

With unemployment falling to 5.3 percent for the county at the end of 2014 — nearly back to the prerecession levels of 2008 — a barely contained optimism is about to burst.

“I think the general consensus is we are heading toward a bit of a renaissance on the lakeshore,” says Peter Wills, interim executive director for Progress Lakeshore. “We’ve had several projects culminate in success this past year. It just seems like we are really peaking.”

That sense of optimism is helped by the removal of significant symbols of past economic challenges.

Old Mirro complex rejuvenated

In the last year, Niagara Worldwide began the process of salvaging and dismantling the 900,000-square-foot Mirro complex in downtown. An emerging market for historical products and repurposed wood — particularly the millions of board feet of old growth hemlock and maple in the plant — has helped renew that project.

As that central complex has begun the healing process, plans for other buildings left behind when Mirro closed its doors are also moving closer to fruition. With housing and historic preservation tax credits falling into place, developers should soon be moving forward with plans to convert the former Mirro Plant No. 3 into a residential housing complex, says Nicolas Sparacio, community development director for the city of Manitowoc.

It’s another visible sign the city is moving ahead and shedding the economic negatives from its past, he says.

“I think it’s been hard for the community to see these buildings for so long when nothing was happening,” Sparacio says. “This is a positive, adaptive reuse of the building and the community will no longer have the scar of that building sitting vacant and unused.”

So far, Wisconsin development firm Impact Seven has received both affordable housing and historic preservations tax credits, as well as assistance from the city of Manitowoc. The company has closed on the property and is currently working to firm up its part of the financing. Sparacio is confident in the project’s viability.

“I think we are at a turning point,” he says. “We definitely want to see more of these type of partnerships. It’s a huge opportunity for the city.”

Sparacio’s positive vibe is spreading across the county. Just up the road in Two Rivers, demolition continues on the former Thermo Fischer Scientific facility and that city’s plans to open up nearly 16 acres of riverfront property to new development.

It’s probably been more than 100 years since there has been that much available property on the riverfront. The latest vexing challenge from the site is the demolition of a 200-foot smokestack that has a historical appeal, but does not necessarily fit into the redevelopment plans. Demolition is on hold while environmental tests are being conducted.

While the smokestack is symbolic to the city’s manufacturing past, the cost to taxpayers of maintaining the structure and the challenges of marketing the property with the giant relic make it impractical to save it, says Two Rivers City Manager Greg Buckley.

The waterfront has become an important part of development all across Manitowoc County. In addition to clearing the Thermo Fischer Scientific site along the river, the Two Rivers community recently launched a campaign to construct a new pavilion at Neshotah Park, host of Kites Over Lake Michigan, one of the largest kite festivals in the Midwest.

Construction is expected to be finished by late summer, just in time for the 10th anniversary Kites Over Lake Michigan festival and will host other community events as well.

The good vibes are a product of several recent successes in the county, including:
» Ironwood Plastics, which announced a $19 million expansion in Two Rivers
» Lakeshore Industrial, a manufacturer of custom cages for safely lifting personnel and materials, will soon be constructing a new, 11,000-square-foot building in Two Rivers’ Woodland Industrial Park.
» Jagemann Plating, which expects this spring to complete a $4.5 million, 36,000-square-foot expansion that will bring new equipment and technology to its operations in Manitowoc.
» The proposed Wisconsin Agriculture Center, a $10 million to $12 million project that will create both an educational and tourist destination showcasing a working dairy farm.

“It seems things are getting better each year,” Wills says.

There is, or course, a specter posing a potential challenge to the recent run of good economic news.

Manitowoc Co. to split ice, crane divisions

Manitowoc Crane – A Manitowoc Crane works on the $3.9 billion New NY Bridge across the Hudson River north of New York City, one of the largest infrastructure projects in North America.  Manitowoc Co. recently announced plans to split its crane and foodservice divisions into two separate companies. Photo courtesy Manitowoc Co.

Manitowoc Crane – A Manitowoc Crane works on the $3.9 billion New NY Bridge across the Hudson River north of New York City, one of the largest infrastructure projects in North America. Manitowoc Co. recently announced plans to split its crane and foodservice divisions into two separate companies. Photo courtesy Manitowoc Co.

Manitowoc Co. announced earlier this year it was splitting its crane and foodservice divisions into two independent companies — a move expected to be complete by the first quarter of 2016.  As it stands today, each division would be its own multi-billion dollar company.

The move is expected to benefit each company by giving it greater flexibility to pursue individual market strategies and attract additional investors, Glen Tellock, chairman and chief executive officer stated in press releases related to the spinoff.

“Manitowoc has taken and continues to take actions to enhance returns, including margin expansion initiatives, re-investment in our businesses, and utilization of our free cash flow to de-lever our balance sheet,” Tellock says. “We believe the separation of Cranes and Foodservice will position these businesses to take advantage of anticipated long-term improvement in demand and other opportunities in their respective markets.”

The company has declined to elaborate beyond its recent press releases because of ongoing legal and financial proceedings related to the separation.

Wills says there is always concern when a large regional employer embarks on a major restructuring, and says that while worries about the company scaling back or relocating operations for either or both divisions are real, there are still many unknowns.

“We hear all those concerns, but so far there is nothing to react to,” says Sparacio. “We continue to reach and let them know we can offer any assistance if needed.”

Good vibes

Manitowoc County’s recent economic development successes are showing up in the positive attitudes many of its corporate leaders have about the regional business climate.

In a recent Manitowoc County Business survey, more than 51 percent of those responding rated the region’s business climate as good or excellent. Another 23 percent gave the area a fair rating, bringing the total for positive responses to 74 percent.

“We are looking forward to seeing those numbers go up even more as we make additional progress,” says Wills.
The same survey found that 85 percent of those companies planned to either maintain their current workforce or bring on additional employees this year.

New face

Sparacio, who is working on the Mirro project (among others) is a new face on the economic development scene in Manitowoc, though he’s a familiar player in the greater New North region.

He joined the city of Manitowoc in his role as community development director in late 2014 after spending nearly six years as a planner for the city of Green Bay. A practitioner of placemaking to help drive economic development, Sparacio helped develop the master plan for downtown Green Bay that set the stage for its recent resurgence, including new corporate headquarters for Associated Bank and Schreiber Foods.

He was also a key player in the mixed-use redevelopment of the Larsen Cannery property by Titletown Brewing Co. that includes additional brewing capacity, a tap room, a public market and office space.

“I’m really hoping to bring that sort of vibe to Manitowoc,” Sparacio says. “There really are some great opportunities here.”
Previous to his experience in Green Bay, Sparacio worked with planning departments in Lincoln and Rusk counties.