TREO Is Working To Position The Tucson Region For Post-Recession Growth

The past year was unprecedented in the U.S. economy. As experienced nationwide, the recent credit and housing crises resulted in rapid job losses and extreme economic uncertainty. While the situation at the national and state level is critical, leaders in the Tucson region are working to take our destiny into our own hands, providing leadership in developing local tools and programs to create jobs for our citizens.

Gains experienced in 2009 were a result of our ability to react quickly and develop programs and initiatives to mitigate the effects of the worst recession in 30-plus years. Significant progress was made in addressing the work force skills gap, improving and expanding our best practices, communications to internal and external customers, and thought leadership.

In response to the economic conditions, Tucson Regional Economic Opportunities (TREO) developed a plan called Tucson: Job One. In conjunction with all our community partners, we created a proposed immediate action plan with clearly defined priorities to address strengthening the local economy, creating and maintaining jobs, and spending. This is our chance to synergize the region’s recent strategic planning efforts and priorities, demonstrating how all local economic drivers can work together to emerge stronger and with a much more diversified economy.

To address local economic conditions, in early 2008 TREO embarked on a comprehensive survey of 170 of the top local companies in an effort to gather data on those planning to hire new employees within the next year. Companies that responded to the survey reported a total of more than 2,200 open positions anticipated to be filled within the next 12 months. TREO then created a job portal on its Web site as part of the Tucson: Job One program. Available at www.treoaz.org/Tucson-Job-Portal.aspx, the job portal provides links to the career pages of a sampling of companies that reported plans to hire despite the state of the economy.

The region realizes it needs to be poised and ready when the economy improves, so TREO has instituted some programs to help facilitate readiness.

Shovel ready and fast track permitting
TREO’s Shovel Ready and Fast Track Permitting program involves the certification of shovel-ready sites for fast-track permitting and development processes. The program makes the Tucson region more competitive in attracting and expanding new, high-skilled/high-wage jobs.

Certified shovel-ready sites are parcels that are on the market for sale or lease, appropriately zoned, pre-qualified to meet local planning requirements, served by utilities, and with identified access to transportation linkages. The certification requirements are designed to ensure the ability of a firm to proceed immediately to the building permit phase and be able to receive approval of plans within 90 days.

California job development program
Arizona Sun Corridor: Open for Business is an unprecedented partnership between the Greater Phoenix Economic Council (GPEC), TREO, the Greater Yuma Economic Development Corp., and the city of Flagstaff that is designed to bring high-wage jobs and investment to the Sun Corridor, a megapolitan projected as one of the 10 U.S. markets expected to see most of the nation’s growth in the next 35 years.

The program pools resources to place a contractor in California who will be responsible for researching companies and qualifying those poised to expand operations. The contractor actively generates business development leads in targeted industries such as aerospace/defense, health care/bioscience, transportation/logistics, renewable energy, and information communications technology.

Transportation and logistics focus
TREO’s efforts in the transportation and logistics industry focus on developing and presenting a regional implementation plan that positions the Tucson region as a recognized global logistics and distribution hub. The goal is to facilitate economic growth, prosperity and opportunity for the Tucson region through the promotion of freight, transportation and logistics.

The Tucson region possesses a strong transportation infrastructure, including interstate highway, railroad and air freight connections. The convergence of Interstate 10 and Interstate 19 provides the region with connections to major east-west and north-south trade corridors. The same advantage holds for the region’s rail connections — the Union Pacific Sunset Route runs east-west through Tucson, along with the north-south connection to Mexico via Nogales. The existing Port of Tucson intermodal operation is a huge asset for the expansion of rail opportunities in Southern Arizona. Additionally, current air freight operations include integrated carriers such as Federal Express and cargo operations provided via passenger carriers. Expansion possibilities exist for air freight with the ongoing expansion of the air cargo warehouse facilities at Tucson International Airport. Recent surveys indicate more than 150 logistics-based businesses are currently serving the needs of freight movement in the region, and more than 72,000 jobs are associated with the existing manufacturing, warehouse, and transportation sectors.

Aerospace and defense industry recognized
According to economy.com, Tucson’s highly concentrated aerospace product and parts manufacturing sector has an 8.35 location quotient, a ratio calculated to compare a region’s industrial activity level to the rest of the United States. The location quotient means Tucson is 8.35 times more concentrated in the aerospace product and parts manufacturing industry than the average of all metropolitan statistical areas across the country.
In August 2009, Business Facilities magazine named Tucson No. 6 on its list of the top 10 metro areas for aerospace/defense manufacturing in its fifth annual ranking report. The ranking is primarily based on a comparison of industry sector employment and wages. Also evaluated were major projects and facility expansion/relocation activity for a region in the past 12 months, and the number of major aerospace and defense contractors headquartered in the region.

Solar heats up
Tucson is home to a growing number of companies involved in the development and production of solar technology, including several recent investments from Germany, Europe’s solar hub. In 2009, TREO conducted an economic analysis revealing that there are close to 50 companies in the region involved in solar-related activities, directly or indirectly supporting more than 2,000 jobs with a total annual economic impact of more than $400 million.

New expansions and relocations
Switzerland-based Roche bought Ventana Medical Systems in early 2008, and purchased 17.1 acres for $8.9 million to expand its campus. Ventana is now the headquarters of one of Roche’s global business units that focuses on diagnostics. Roche CEO Severin Schwan says the company plans to expand research and development laboratories at Ventana’s campus and increase staffing levels from about 750 to more than 1,000.

Tucson-based Salutaris Medical Devices, a startup medical devices firm, received $1.5 million in Series A financing by Arizona venture capital firm Translational Accelerator (TRAC). TRAC, a private, Arizona-based, $20 million bioscience venture capital group, is Arizona’s first venture fund established to target early-stage bioscience companies. TRAC investments only support firms located in Arizona or those planning to move to the state.

The Rockefeller Group Development Corporation broke ground on the first of three distribution buildings on a 21.5-acre, pad-ready approved industrial site in the Tucson Airport Commerce Center. The first building, a 113,000 square foot state-of-the-art speculative distribution building was completed and ready for occupancy in June 2009.

Schletter, a manufacturer and distributor of solar mounting systems based in Germany, chose Tucson for its first U.S.-based operations center. Schletter has operated more than 40 years in the design and manufacturing of steel and aluminum products, and rose to be the largest provider of solar mounting systems in Europe, supplying utility-sized PV-projects. Following the German lead, the Tucson facility offers everything from design and development to manufacturing of Schletter products.

Since TREO was formed in 2005, more than 40 companies have announced their relocation or expansion in the region, adding thousands of new jobs and contributing more than $1 billion in fiscal and economic impact.

Laura Shaw, senior vice president of marketing and communications for TREO contributed to this report.


Arizona Business Magazine

January 2010