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FAST LANE - July
2005
The new facility will result in 1,500 additional employees on the Covington campus and produce a $115 million construction project for the region’s economy. The company’s plans were made public after the Kentucky Economic Development Finance Authority (KEDFA) granted approval for tax incentives tied to future job growth and local infrastructure improvements to assist with access to theFidelity campus and more than 250 acres of additional land designated for neweconomic development projects along KY 17. “Securing this Fidelity expansion has many positives for Northern Kentucky,” said Steve Pendery, chairman of Northern Kentucky Tri-ED. “First, confidence in the Northern Kentucky market is exemplified because other targeted businesses heed smart location and expansions when firms like Fidelity Investments show such confidence in our area. Second, keeping and attracting quality jobs like these raise the standard of living of all in Northern Kentucky. Third, our youth in Boone, Kenton and Campbell counties have at least 1,500 more solid jobs to aspire for.” Fidelity expects construction on the new building to begin later this year with an opening scheduled as early as the end of 2007. At that time, the company will relocate more than 700 employees currently in Blue Ash, Ohio leased space to consolidate its Midwest operations entirely on the Covington campus. Fidelity’s Midwest operations currently employ more than 3,600 people. The new 350,000 square foot building will be the fourth built on the 188-acre Covington campus since 1994. Currently, Fidelity has three buildings on the campus totaling approximately 780,000 square feet. Fidelity ranks as one of the world’s largest financial services providers, with assets of $2.1 trillion. STATE In the residential real estate industry, which is already setting record sales numbers, the summer months get even hotter as families strive to relocate before the next school year begins. And in a recent study conducted by Worldwide ERC, Primacy and Sperling’s BestPlaces, a number of Kentucky cities were showcased as being among the best in the nation for relocating families. The ranking process combined traditional factors such as tax rates, average home cost, and home appreciation with more subtle variables that can affect quality of life and cost of living after a move – including the ability to qualify for in-state tuition, service levels of local utilities, volunteerism, and auto taxes. New criteria for 2005 also included nuanced climate criteria to give value to those cities where mild winters, mild summers, and plentiful rainfall combine to keep utility prices reasonable. HIGHLAND HEIGHTS General Cable Corporation has announced plans to close its plants in Bonham, Texas and Dayville, Connecticut. The Texas plant, which employs approximately 170 people, is one of its three North American plants that manufacture copper telephone exchange cables. “As a result of the significant reduction in demand for copper telephone exchange cable over the last several years, our Bonham facility has been operating at below 50 percent of its capacity,” said General Cable CEO Gregory B. Kenny. The Connecticut facility was also operating at under 50 percent of its capacity, noted Kenny. “The decision to close these facilities was based strictly on our need to further optimize the utilization of our available manufacturing capacity in a market for communications cables that has experienced a significant decline in demand over the last four or five years.” General Cable is a leader in the development, design, manufacture, marketing and distribution of copper, aluminum and fiber optic wire and cable products. BOWLING GREEN The old Bowling Green Mall is once again serving as a hub of business activity as Western Kentucky University’s Center for Research and Development. WKU research operations in the facility include the Applied Physics Institute, the Institute for Combustion Science and Environmental Technology and the Center for Advanced Solar Studies. Buddy Steen, director of the Central Region Innovation and Commercialization Center, said the facility’s mission is to attract and develop science and technology companies and create high-tech job opportunities in the community and for WKU graduates. “We’re proud of what Western and our many partners have done to make this facility a driver for economic development,” WKU President Gary Ransdell said at the center’s ribbon-cutting ceremony. “This is the classic example of what higher education is and what it should be about,” he said. Commerce Secretary Jim Host commended Ransdell for working with business leaders and with local, state and federal governments “to convert this old shopping mall into the Center for Research and Development.” The Center will become a national model and will be a one-stop shopping center for state-of-the-art research and development activities, Host noted. GEORGETOWN
The new law, which goes into effect October 1, prohibits smoking in all public places, including businesses, restaurants and hotels. Business owners who do not enforce the law will face fines, beginning at $50 for the first offense and escalating for future infractions. Local groups have already stated plans to oppose the ban. And Varney acknowledges that he’s open to revisions. “This thing will be tweaked time and time again,” he told the Georgetown News-Graphic. “We want to make this the best ordinance for everybody.” PIKEVILLE
The Pikeville Medical Development Corporation will primarily focus on developing health care delivery systems and hospital-related projects that will spur the local economy. The corporation will also work to promote various types of economic development projects that are not related to health care. The mission of PMDC includes developing collaborative research initiatives between PMC and major medical research entities in Louisville as well as Pikeville College School of Osteopathic Medicine and other similar institutions; creating a high-tech, regional research and development institute in eastern Kentucky to work with other medical partners in fostering advanced medical-related concepts and other new economy-type startup companies; and encouraging private companies to locate in eastern Kentucky. “In eastern Kentucky, we have a lot of social, economic and infrastructure problems,” said Pikeville Medical Center President Walter E. May. “All these problems can be solved with the creation of jobs. If we can create jobs, the other problems will correct themselves. Pikeville Medical Development Corporation is dedicated to contributing to the growth of our local economy in an important way.” OWENSBORO Owensboro was recently named a “Broadband Boomtown” by Business 2.0 magazine, a publication for the high-tech business community. Owensboro was one of four Southeastern cities highlighted in the May article, along with Bristol, Virginia; Daytona Beach, Florida; and Manassas, Virginia. Those cities were in the company of other, more prominent hi-tech areas such as New York City, Philadelphia, Washington, D.C. and Chicago. The magazine highlighted the efforts of Owensboro Municipal Utilities (OMU), which built a fixed wireless network throughout the greater Owensboro area to serve local businesses and residential customers. Network construction began in 2002 as a pilot project with 80 customers and one antenna. Since then, demand has steadily increased, and the company now serves nearly 3,000 customers over 13 wireless antennae sites. Owensboro Municipal Utilities chose the fixed wireless network as the best option to deliver high-speed Internet technology to their small business and residential customers. BOWLING GREEN A new nonprofit organization is now operating in Bowling Green, designed to help companies with various aspects of international business. The Global Advanced-Leadership Center opened its doors earlier this month in downtown Bowling Green, with Raja Bhattacharya heading the center. “We started thinking about this center a year ago,” Managing Director Bill Parsons told the Bowling Green Daily News. “Through some conferences like the Global Automotive Conference, we realized a need for this kind of organization. There are a lot of unfulfilled job tasks out there in management and middle management, coaching and mentoring that need the type of training and skills we can provide. That way those individuals at that level of management can take on and lead their own units within a company.” The center will take traditional classroom learning another step further, added Parsons, by emphasizing “rational decision-making, critical analysis, intuitive things that can only be developed on the job.” The center has developed partnerships with the Bowling Green Area Chamber of Commerce and the Intermodal Transportation Authority and is also working with the Kentucky World Trade Center, the Kentucky Cabinet of Economic Development and the U.S. Department of Commerce. “There’s nothing like it in the state,” Parsons explained. “It’s regional in scope. We will serve possibly a four-, five- or six-state area.” While the center will concentrate on the automotive industry to a great extent, assistance will be provided to any company that is interested in increasing its global presence, including farmers. “Farmers in the state have been so focused on tobacco,” Parsons noted. “This will allow us to emphasize other business models for offshore ag markets.” STATE "In the Interest of Women,” an annual women’s conference sponsored by Toyota Motor Manufacturing, Kentucky (TMMK), has been scheduled this year for October 10-11. The conference will be held on October 10 at the Lexington Center in Lexington and will meet in Louisville’s Galt House East on October 11. The 2005 event will feature keynote speakers Priscilla Presley and Kathleen Passanisi. In addition to serving as co-executor of the Elvis Presley Estate, Presley has forged a career as an actress, author and businesswoman and will share the challenges and successes she has faced over the years. Passanisi is a recipient of the Lifetime Achievement Award in the field of therapeutic humor who has inspired many people through her entertaining and enlightening programs. This year represents the ninth time Toyota has held the day-long event, which allows attendees to select four workshops from a slate of 12 options. The conference will run from 8:30 a.m. to 4:30 p.m. Registration is $75 per person. For additional information, call 859-252-3350 ext. 3813 or visit www.toyotageorgetown.com/women. STATE
Representatives from the University of Kentucky, University of Louisville, Eastern Kentucky University, Kentucky State University, Northern Kentucky University and Western Kentucky University were all on hand to showcase the commonwealth’s niche capabilities and opportunities in bio/life sciences. “Among our goals are to attract life science businesses, researchers and entrepreneurs to Kentucky and mobilize additional venture capital investment in the commonwealth,” said Dr. Allyson Handley, senior advisor for economic initiatives to Governor Ernie Fletcher and Dr. Thomas Layzell, president of the Council on Postsecondary Education. “Bio/life science business development won’t happen overnight, but it will happen,” stated Handley. “The governor is committed to fostering and developing expanded commercialization ventures and our postsecondary education system, which is a critical partner in the creation of knowledge economy enterprises, is actively engaged.” James R. Ramsey, president of the University of Louisville, noted that the event “enables us to show the world the outstanding research we’re doing in Louisville. And it helps us show that Louisville and the commonwealth are ideal locations for such research efforts and for the companies and other economic development opportunities they bring with them.” LOUISVILLE
Genentech discovers, develops, manufactures and commercializes biotherapeutics for unmet medical needs. Founded in 1976, the company has multiple protein-based products on the market for serious or life-threatening medical conditions and over 30 projects in the pipeline. Its research organization focuses its efforts on basic and applied science in oncology, immunology, and vascular biology. “Louisville’s future is the knowledge-based economy and Genentech’s research and life-improving products provide the right kind of job opportunities for our community,” said Louisville Mayor Jerry Abramson. “Riverport was able to fit Genentech’s needs, with available workforce, nearby transportation networks, and existing infrastructure.” “We expect that this distribution center will play an important role in helping provide Genentech with the distribution capacity needed to support our anticipated growth, as well as enhance our ability to get life-improving and life-extending products to our patients quickly, “ said Patrick Y. Yang, Ph.D., senior vice president of product operations for Genentech. “In our evaluation of potential locations for a distribution facility, Kentucky provided us with the best overall package including government incentives, the availability of appropriately skilled labor, proximity to a major shipping hub, and readily available appropriate facilities.” The company has signed a lease on a 164,000-square-foot facility at Jefferson Riverport International. The facility is slated to be operational early next year with an initial staff of 15. Genentech has been ranked as one of FORTUNE magazine's "100 Best Companies to Work For" for seven consecutive years. It has also been named by Science magazine as "the top employer and most admired company in the biotechnology and pharmaceutical industries" for the third consecutive year. LOUISVILLE Sonopress LLC, a world leader in media services and turnkey production operations, and Coral Graphic Services, the leading supplier of printed book components to the U.S. book publishing industry, have formed a joint venture to open a new facility in Louisville. The new 260,000-square-foot facility is slated to open in July 2005. Louisville was selected based on its centralized location and easy accessibility to UPS’ shipping hub. “It is estimated that 60-70 percent of sales in the gaming industry occur during the first month of a title’s release,” said Joe Mann-Stadt, president and CEO of Sonopress US. “Therefore, it is absolutely critical that game publishers have an efficient supply chain to ensure that their titles are consistently available to retailers at a moment’s notice. Our new facility in Louisville will enable us to produce, package and distribute high-quality games and software in a rapid and cost-effective manner, giving our customers even more confidence that their products will be on shelves during crucial sales periods.” The Louisville facility will house printing, auto assembly and display build capabilities and focus on the entertainment and software industries, operations that will initially require approximately 100 full-time employees. For its area of the new Louisville facility, Coral Graphics will employ state-of-the-art printing technologies to efficiently produce high-quality graphics. The facility will enable Coral Graphics to more effectively partner with Sonopress by accommodating the tight turnaround times for Sonopress customers and reduce typical freight costs. Both Sonopress and Coral Graphics are divisions of Bertelsmann’s arvato AG international media service company. LOUISVILLE Integrity Life Insurance Company has announced that it is moving its Louisville headquarters to Cincinnati. Company officials say the majority of the 234 Louisville employees have been given the option to relocate to Cincinnati, where the company currently employs approximately 1,600. The Louisville positions range from back-office support to senior management positions. Employees have been asked to inform management of their decision by next month. Integrity is a subsidiary of Western & Southern Financial Group, a Cincinnati firm that acquired the company in 2000. The companies market fixed and variable annuities and other financial products through investment brokers and financial planners throughout the nation. Western & Southern Chairman and CEO John Barrett said the move to Cincinnati will help the company “achieve substantial savings from economies of scale.” Integrity will, however, maintain a presence in Louisville, with President John Lindholm remaining there, along with a small support staff. LOUISVILLE
The consulting firm has been charged with determining the ideal size and location for the arena in addition to identifying what type of events would be able to use the facility and providing data based on comparisons with similar arenas in the country. University of Louisville President James Ramsey has said building the arena on the UofL campus would give the school a strong boost and has suggested a site near the campus along Interstate 65. Louisville Mayor Jerry Abramson is advocating placing an arena downtown, noting that other sports facilities such as Louisville Slugger Field have been an impetus behind increasing economic development in the area. A survey conducted by Louisville.com found that nearly 31 percent of respondents favored a downtown arena, with 14.7 percent in favor of putting it on the UofL campus. The remaining respondents wanted to see the facility built at the fairgrounds (8.6 percent), in the suburbs (2.5 percent) or not built at all (17.7 percent). Governor Ernie Fletcher has asked the arena task force to provide a recommendation by October 1, in order to have the necessary information compiled by the time the General Assembly meets in January. The consulting firm is expected to provide its report by early September. LEXINGTON
Lexington-based Tempur-Pedic International, which manufactures and distributes mattresses and pillows from a unique viscoelastic material, has been named to BusinessWeek magazine’s list of the nation’s 100 “Hot Growth Companies.” “BusinessWeek has its finger on the pulse of the business community in the United States and beyond. To be recognized by this publication is extremely exciting for Tempur-Pedic,” said Tempur-Pedic President Tom Bryant. To identify its “Hot Growth Companies,” BusinessWeek looks at publicly-traded companies with a wide range of revenues and ranks them by sales and earnings growth and return on capital over a three-year period. The process highlights companies with a consistent track record whose market cap is at least $25 million and whose share price is at least $5. Companies are cut from the list if they’ve had a recent earnings slide or whose stock has underperformed the NASDAQ Composite. NGAS Resources, Inc., an independent energy company that specializes in natural gas development drilling, has been named one of America’s 100 Best Small Companies by FORTUNE Small Business magazine. To compile the list, a financial research firm screened annual reports for public companies with annual revenue of less than $200 million and a stock price of more than $1. Companies were ranked based on the past three years’ earnings growth, revenue growth, and stock performance. Real estate firms and banks, which had begun to override the list in recent years, were not considered for the list this year. LEXINGTON
The College of Agriculture Equine Initiative, a partnership between the College and the horse industry, was established through efforts of the Gluck Equine Research Foundation, the Kentucky Thoroughbred Association/Kentucky Thoroughbred Owners and Breeders, and College of Agriculture faculty and administrators. The initiative will be focused on ensuring that UK programs are responsive to the daily needs of the equine industry and will be conducted in concert with the Kentucky Equine Education Project (KEEP) and numerous other equine organizations in Kentucky. The Equine Initiative involves:
A similar relationship to support the cattle industry in Kentucky has been hailed as a model. “As the state’s flagship, land-grant research institution, we have a responsibility to do everything we can to protect this industry that is so important economically and to our Commonwealth’s very identity,” noted Todd. “If UK is going to be a catalyst for a new Commonwealth, one of our most important initiatives must be to help our already established areas of success maintain their progress.” LEXINGTON The Lexington-Fayette Urban County Airport Board has awarded a contract to Messer Construction Company of Cincinnati to construct a $15.5 million six-gate addition to Blue Grass Airport’s “B” Concourse. The project will include six new passenger boarding gates, at least four new jet bridges, a new retail outlet, and a food/beverage outlet. “We have 10 boarding gates and 14 aircraft trying to use those gates each morning. This addition will allow airlines to operate more efficiently today and allow us to accommodate new growth in the future,” explained Michael Gobb, executive director for Blue Grass Airport. Construction work is already under way and is expected to last approximately 14 months. Upon completion in the summer of 2007, the airport will offer 16 passenger boarding gates with nearly all airline operations utilizing covered jet bridges, allowing passengers to seamlessly board aircraft without walking out in the elements or having to climb stairs to/from their aircraft. In addition, as part of a separate project, the airport will begin renovating the “C” Concourse which is currently used by American Eagle, Northwest, United Express and US Airways Express. The $650,000 renovation will introduce new seating, flooring, ceilings, lighting, wall coverings and larger restroom facilities. Work on this renovation will begin next month and is expected to be complete in January 2006. ’s airport has added 10 new nonstop destinations and set passenger activity records in both 2003 and 2004. LEXINGTON A study released by the Lexington-Fayette County Food and Beverage Association reports that the city’s smoking ban, which went into effect last year, has resulted in a drop in business at Lexington restaurants and bars. The report, which was conducted by Thalheimer Research Associates, measured the monthly sales of three of Lexington’s six wholesale alcohol distributors to the city’s restaurants, bars and hotels. According to the figures released, there was a 9.8 to 13.3 percent drop in orders to the distributors. That, says Food and Beverage Association President Dave Whitson, indicates that people aren’t drinking as much as before. “If we don’t have that demand,” he told the Lexington Herald-Leader, “we won’t order it from the wholesaler.” In contrast, a report released earlier this year by the University of Kentucky found there to be no significant economic impact on businesses as a result of the smoke-free legislation. The UK report studied the impact of the smoking ban in three areas: employment in restaurants, bars and hotels; payroll withholding taxes in restaurants, bars and hotels; and food establishment openings and closings in Lexington before and after the smoking ban. INDIANA BioCrossroads, Indiana’s life sciences initiative, has announced the formation of the Indiana Seed Fund I, a seed-stage pre-venture capital fund designed to promote business formation and growth in the state’s life sciences sector. The Indiana Seed Fund was formed to help narrow the gap between the discovery of an idea and actual venture capital funding and to prepare companies for venture investments through vehicles like the Indiana Future Fund I. “Indiana has a critical mass of research capacity and intellectual property, from both our world-class universities and our corporate R&D strength,” said David Johnson, BioCrossroads CEO. “But turning these assets into new and lasting business opportunities requires funding at every stage of the entrepreneurial lifecycle. With the Indiana Future Fund and Indiana Seed Fund, we’re moving toward making the right kind of venture capital available to emerging life sciences companies all along the way. We want these businesses to form, grow and stay in Indiana. “Indiana is taking a unique approach to expanding access to capital, a market-driven approach,” noted Johnson. “While other states are establishing more conventional economic development funds for early investments, we’re confident the best way to make our investments count and grow our life sciences economy is by letting the marketplace pick winners.” OHIO Moving to capitalize on the Internet search business segment, the E.W. Scripps Company has announced that it is acquiring Shopzilla, a comparison shopping search engine, for $525 million. Founded in 1996, Shopzilla is a privately held company that is expected to generate $30 million to $33 million in segment profit on revenue of $130 million to $140 million for 2005. The majority of Shopzilla’s revenue is derived from referral fees paid by participating online retailers. A fee is collected by Shopzilla when a consumer is directed to a retailer’s online store. Shopzilla also powers shopping search for many of the Web’s largest consumer sites including AOL, Lycos, Time Warner’s RoadRunner and many others. Cincinnati-based Scripps is a diverse media concern with interests in broadcast, publishing and interactive media. All of the company’s media businesses provide content and advertising services via the Internet.
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Copyright 1996-2005, by Kentucky Business Online. All rights reserved. Editorial content
is copyright 2005, Lane Communications Group The Lane Report is a trademark of Lane Communications Group. All other trademarks are the property of their respective owners. |
Fidelity Investments has announced plans to construct a new 350,000-square-foot building at its Covington regional facility in order to consolidate its Midwest operations.
In the large market category (cities with a population of 500,000 or more), Louisville ranked fifth in the nation. Lexington ranked second in the nation in the medium market category (population 250,000-500,000), followed by Hopkinsville (8th), Henderson (14th) and Ashland (46th). Owensboro was listed as the 14th-best small community (population 50,000 – 250,000) in the nation for relocation families.
The Connecticut plant employs some 30 workers, who manufacture fiber optic military and premise cable. Those operations will be moved to the company’s recently acquired facility in Franklin, Massachusetts, which produces copper as well as some fiber optic communications products. 
The center includes 269,000 square feet under roof with about 86,000 square feet of retail space owned by the WKU Foundation and almost 183,000 square feet in commercial, public, economic development and research space. The commercial space includes a small business accelerator with 11 tenants. 
With Mayor Everett Varney breaking a tie vote, the City of Georgetown has become the second Kentucky community to pass a smoke-free legislation. Lexington passed a similar smoking ban last year.
The Pikeville Medical Center President Board of Directors has approved the establishment of a wholly-owned subsidiary that will promote economic development in eastern Kentucky. 
Kentucky’s university system was well-represented at the recent BIO 2005 Conference, the world’s largest biotechnology gathering that brings together more than 18,000 biotech executives, investors, journalists, policymakers and scientists from more than 60 countries around the world. 
California-based Genentech, Inc., a leading biotechnology company, has announced plans to locate a warehouse and distribution facility in Louisville. 
The Louisville task force assigned with the responsibility of studying the feasibility of a new arena for the city has hired a consultant to review the issue.
Two Lexington companies are have been selected by national publications as being among the fastest growing companies in the U.S.
University of Kentucky President Lee T. Todd Jr. has announced an initiative to design ways for the university to work more closely with Kentucky’s horse industry.
The $4 million Seed Fund will provide working capital in the range of $50,000-$500,000 to promising Indiana life sciences companies at the preliminary stages of operation. 
American Greetings Corporation has announced plans to move distribution operations of one of its companies from North Carolina to Danville in the fall, increasing its Danville employee base by 16. The company’s AGI Schutz division manufactures wood and plastic display cabinets for American Greetings products. With the distribution operations of AGI Schutz located in Danville, American Greetings will be able to ship its products – such as the company’s classic Holly Hobbie line pictured here – and the appropriate display cabinet together. The company plans to lease space in the former ATR building to accommodate the Danville expansion. 
A recent study conducted by the University of Cincinnati reports that the Greater Cincinnati/Northern Kentucky Airport contributes $4. 52 billion annually to the tri-state economy and supports more than 55,000 jobs throughout the region. The study also analyzed the role that air service has played in the region’s business development and job growth over the last two decades. Superior access to national and world markets has helped create 97,500 additional jobs for the area, the study found. 
The Kentucky Public Service Commission has approved 11 environmental improvement projects proposed by the Louisville Gas & Electric Co. and the Kentucky Utilities Co. The projects are required in order for KU and LG&E to comply with new or revised government regulations, particularly U.S. Environmental Protection Agency requirements to reduce air emissions from coal-fired power plants. The projects will reduce the companies’ sulfur dioxide emissions by at least 110,000 tons per year. LG&E estimates its seven projects will cost a total of about $57 million. KU’s four projects have an estimated cost of about $760 million. Under Kentucky law, the utilities are allowed to recover their environmental compliance costs for coal-fired generating facilities through a surcharge on electric bills. The impact on individual electric bills will depend on actual construction costs, interest rates and other factors.
Chase Bank is planning to add 100 more jobs at its Lexington loan process center, as the company relocates processing work currently being handled in other locations to Lexington. The expansion will boost the bank’s Lexington workforce to 550 by the end of the year. 
Nissan North America, Inc. has announced that it will begin manufacturing the Nissan Altima gasoline-electric hybrid car at its Smyrna, Tenn., plant beginning in 2006. Nissan will invest $10.4 million for additional equipment and minor modifications at the Smyrna plant to accommodate the hybrid. The plant currently builds Nissan’s Maxima, Xterra, Frontier, Altima and Pathfinder models.