Missouri Partnership Briefing

City of Washington / 11.7.2012

What is Economic Development?• Keep and grow existing businesses

• Help launch new business start-ups

• Attract expanding and relocating businesses

Where Does the Partnership Fit In?• Keep and grow existing businesses

• Help launch new business start-ups

• Attract expanding and relocating businesses

Our History• “Marketing and sales” for Missouri

• Established in late 2007

• Public-private, not-for-profit status

• Offices in St. Louis and Kansas City

• $2.7 million annual budget comprised of contract funding and foundation investment

Our Mission• Get Missouri in the game– HOW: Aggressive, proactive marketing effort to

position Missouri as a place to expand or relocate

• Help Missouri win the game– HOW: Team approach with multiple local,

regional, state, and private-sector partners aimed at persuading companies to choose Missouri

Our Strategy – Marketing • Air Campaign

• Ground Campaign

• Product Development

Our Strategy – Recruitment• Assemble the Right Team, Every Time

• Focus on Impeccable Customer Service

• Control What Can Be Controlled

Our Deliverables• Elevate Missouri’s profile and image

• Generate opportunities to compete

• Consummate business recruitment wins

Our Operating Environment• What does our pipeline of deals look like? • What matters to companies?• What are our clients looking for?• Where and how are the deals coming in?• What are the types of deals out there?• What are the odds of getting a look?• What are the odds of winning a deal?• Why and how are deals lost?

Our Pipeline

CONTACT

PROSPECT / INQUIRY

ACTIVE PROJECT

WIN

Pipeline Snapshot10/31/2012 10/31/2011

Active Projects 81 62New Jobs 22,500 13,400New Annual Payroll $502mm $338mmNew Investment $7.4bb $2.8bb% from Consultants 51% 46%% involving FDI 31% 26%Prospects/Inquiries 106 19

What Matters to Companies? 2012

2011Highway accessibility 1st 1st

Available skilled labor 2nd (tie) 7th

Labor costs 2nd (tie) 2nd

Corporate tax rate 4th 6th

Real estate costs 5th (tie) 4th

Source: Area Development 2012-2013 Corporate Survey

What Else Matters to Companies?

2012 2011Incentives

5th (tie) 5th Energy costs 7th

9th

Tax exemptions 8th 3rd

Proximity to markets 9th 17th

Labor climate 10th 11th

Source: Area Development 2012-2013 Corporate Survey

What Are Our Clients Looking For? 2012 (YTD) 2011

Real estate searches 34 37Want existing building 24 28Want greenfield site 9 8Want building or site 1 1Statewide search 15/3412/37St. Louis region 7/34 11/37

What Are Our Clients Looking For? 2012 (YTD)

2011Avg. building (industrial) 154K s.f 131K s.f.Avg. building (office) 15K s.f. 28K s.f.Median greenfield site 30 acres n/aAvg. greenfield site 328 acres 77 acres% needing rail 32%24%% needing rail (site only) 70%70%

Where Are the Deals Coming From?• 40 to 50 percent of deals in pipeline are via

consultants – 2011 site search statistics:

19 out of 37 real estate searches represented by a third-party

consultant– 2012 YTD site search statistics:

19 out of 34 real estate searches represented by a third-party

consultant

How Are the Deals Coming In?• States• Tier 1 metropolitan regions (e.g. St. Louis)• Tier 2 metro regions (e.g. Springfield, Columbia)• Ex-urban / rural communities

What Types of Deals Are Out There?• New facility expansions with a national or

multi-regional search geography• New facility expansions with a narrowly

defined search geography– From outside the state (e.g. auto suppliers)– From within the region (e.g. satellite operations)

• Existing facility consolidations or relocations– More common in a slow economy

What Are My Odds of Getting a Look?• Is the company/client interested in our part of the

state / country / world?• Do we have a workforce that this company can

hire and train to do the job?• Do we provide the best cost and value solution to

the company/client?• Do we have a building or site that meets the basic

needs of the proposed new facility?

What Are My Odds of Winning a Deal?• Business attraction is highly competitive!• Henry VIII and the many fates of a deal• e.g. Since 2010, the Partnership has converted

approximately 10 percent of its pipeline (including “prospects” and “active projects”)

Our Long-Term Challenges• Product awareness

• Product perception

• Product vs. Packaging

Why Missouri?• Top 10 State for Doing Business (Pollina)• Top 10 best corporate tax index (Tax Foundation)• Top 10 best regulatory climates (Forbes)• Top 10 tax/regulatory climate (US Chamber)• Top 10 lowest energy costs (EIA)• Top 10 for economic competitiveness (ALEC)• AAA bond rating for 22 straight years• $250B economy that’s 4th-most diverse (BEA)

Christopher ChungPresident and Chief Executive OfficerMissouri Partnershipchris@missouripartnership.com