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Regional Business Reports
A roundup of news from across North Carolina

Crutchfield's Retirement Marks a Generational Change
He was at the top, but when Edward Crutchfield Jr. stepped down last month as chief executive of First Union Corp., to be succeeded by Ken Thompson, formerly president, it marked more than an executive shift at the nation's sixth-largest bank and third-largest employer in North Carolina. Experts say the foundation of banking, business and civic affairs in Charlotte and the state is shifting too.

Crutchfield's departure, hastened by lymphoma, a treatable form of cancer, comes only 18 months before the scheduled retirement of Hugh McColl Jr., whose office is four blocks up Charlotte's Tryon Street at Bank of America Corp. The two, say industry analysts and local leaders, have not only molded banking but also have had profound effect on Charlotte growth and civic matters.

“He's part of how Charlotte got on the map,” says Rod Autrey, a city council member, of Crutchfield. Parks Helms, chairman of the Mecklenburg County Commission, calls Crutchfield's retirement, “part of a generational shift,” and Mayor Pat McCrory calls it, “a signal to the next generation to take charge.”

While no one expects participation by First Union and Bank of America in public education, community development, literacy programs and other activities to wane, most believe the power base is expanding and less dependent on a tightly knit group of executives that once included the two bankers, Bill Lee, the late chairman of Duke Power Co., and members of the Belk retailing family, including John Belk, former Charlotte major.

The new era could include more focus on regional and state issues such as growth, transportation and city and state roles in global affairs. But experts say the generational change in banking may be even more profound.

Crutchfield, 58, who will remain chairman until the end of 2001, and McColl, 63, are credited with pioneering interstate banking and aggressive consolidation. Since 1985, when he took over First Union and quickly acquired Northwestern Financial Corp. of Greensboro, Crutchfield has built First Union from $7 billion in assets to $253 billion. Bank of America, the nation's largest bank, has mushroomed to $621 billion in assets, in 22 states.

But analyst John Moore with Wachovia Securities Inc., in Charlotte, says the new generation, like Thompson, a Rocky Mount native, will see fewer mergers. They'll have to integrate technology into banking without alienating customers, and increase market share with fewer takeovers. “Buying banks and running them are two different things,” adds John Forlines Jr., chairman of Bank of Granite in Granite Falls, one of the country's most successful small banks.

Leadership of the state's next largest banks is unlikely to change for a while. At Wachovia Corp. in Winston-Salem, Bud Baker Jr., 57, recently signed a two-year contract extension and has the option to renew it beyond that, and at BB&T Corp., also in Winston-Salem, John Allison, chairman and chief executive, is only 51.

But most bankers are preparing for change. At Centura Banks in Rocky Mount, Cecil Sewell is 54, a typical age for senior bankers. “Then we've got the 40-somethings,” he says. “We figure to spend the next 10 years developing that team to do things a lot different than we've done.” —Edward Martin

 

Transportation Museum Renovation Begins
When Southern Railroad donated the Spencer Shops site to the state 20 years ago, it was home to decaying facilities and fading memories. Today, the N. C. Transportation Museum, near Salisbury, is a homage to the energy and enthusiasm of volunteers, state officials, and staff who have salvaged the state's transportation history. Through two decades, their tireless efforts have renovated buildings and artifacts, rebuilt locomotives, and raised money one step at a time.

In 1996, the NCTM completed restoration of the c-shaped Roundhouse, the largest and one of the few remaining such structures in the country. It covers five acres and contains 37 bays, a working restoration shop and exhibits. It is home to historic steam locomotives, diesel engines and even the private rail car of James B. Duke.

Now, the last major project at the Transportation Museum is underway.

The main building of the old railroad repair site is about to experience a $30 million makeover. The mammoth Back Shop building will undergo a complete exterior restoration, and the interior — the length of two football fields — will be renovated to house a museum chronicling the development of inland transportation in North Carolina. Work is set to begin this month on the building's exterior. A new roof and replacement panes for the two-story window casings are among initial projects, along with refurbishing the hand-formed bricks and deteriorating mortar. “We have a tremendous story to tell,” said Elizabeth Smith, the museum's executive director. “The Back Shop renovation gives us the space to share this rich and diverse history, as well as to reach out to school children, families, and tourists with a unique, focused approach.”

The entire project is expected to be complete in 2003. The nonprofit NCTM Foundation has begun a campaign to raise $5 million in private money to help finance the project. “The enormity of this project will make it a destination for tourists going North and South along the East Coast,” said Elmer Lam, NCTM Foundation president. “It will be second only to the Smithsonian as a complete, state-of-the-art transportation history.”

Exhibits will include hanging artifacts like a DC-3 commercial airliner with Piedmont's signature colors, a replica of the 1903 Wright Flyer and other surprises. Under a mezzanine running the length of the building will be curriculum-oriented exhibits exploring neighborhoods, goods and services and science and technology. The mezzanine itself will allow visitors to experience the exhibits from an additional perspective. A theater that seats 200 will immerse visitors in a sensory experience.

Exhibits will center along an interior “highway” that winds throughout the building. A restored railway track will also run through the space, creating a series of grade crossings and other interpretive opportunities — crank a Model T and try to start up or shift the gears of an 18-wheeler or even control the rudder as you “fly” a hang-gliding simulator.

Exhibits will trace the entire history of inland transportation: Indian foot paths, canoes, wagon trails, railroads, trolleys, country roads, interstate highways, trucks, tractors, airplanes, helicopters, school buses, hot air balloons, boats, race cars, even space travel. The impact of geography, the contrast of vintage road surfaces with high tech solutions, the development of towns and cities, and the importance of lakes and rivers are a few of the exhibit contents.

More than 100,000 visitors each year appreciate the renovated facilities, restored artifacts and exhibits currently installed at the site. Those numbers are expected to grow dramatically when the Back Shop renovation project is complete. — Pat Hunnell

 

N.C. Trust Expands its Reach
As the result of a recent merger with U.S. Trust, Greensboro's North Carolina Trust is now U.S. Trust of North Carolina, part of a network of offices in Florida, Texas, California, Oregon, New Jersey, Connecticut, Pennsylvania, and the District of Columbia. U.S. Trust manages about $80 billion for its clients, most of whom have at least $2 million each in investable assets.

“We wanted to move our company to the next level and to do that we needed more investment choices for our clients, such as a family of mutual funds, private banking and more technology resources,” says NCCBI executive committee member Sue W. Cole, the former president of North Carolina Trust. To reach that level, North Carolina Trust needed a partner. They found it in United States Trust, the nation's oldest trust company, founded in 1853.

Cole, now president of U.S. Trust Company of North Carolina, says the merger is giving the former N.C. Trust exactly what the officers wanted — the ability to expand services. She expects the company to add about 30 employees in the company's three offices.

“When we were thinking about what we wanted to do, we knew that technology was changing rapidly. We felt we had to have some scale in order to get the technology resources for our clients. Some of our clients wanted us to handle their debt and liquidity needs through private banking,” Cole explains. “We had a number of options to do this. One was building these needs ourselves, but we felt the timing was appropriate to merge with a company like U.S. Trust, which was clearly the premier wealth management company in the country.”

For the past 17 years N.C. Trust has been conducting surveys of the affluent, focusing on the top one percent of income earners who make an income of $230,000 per year and have net worths of $3 million or more. This year's focus was on the Baby Boom generation and how they see themselves and their money.

“One interesting point was that the Baby Boomers tend to save and don't spend much out of their investment accounts. They are fairly conservative with equities representing about 45 percent of their asset allocation. That shows that they are not aggressive investors,” Cole says. “Another thing we found is that they are charitably inclined and very hard workers. They seem to be retiring at a later age. Some of them may retire from a corporation where they have built a career, but they are starting a second career as a consultancy or their own business.”

Since the U.S. Trust and N.C. Trust merger, U.S. Trust has also announced plans to merge with Charles Schwab, but U.S. Trust and U.S. Trust of North Carolina will maintain their names and continue to focus on investment management, fiduciary services and private banking. —Clint Johnson

Moore County Scouts More Sporting Events
Moore County already has hosted the national men's and women's golf championships and has two more such events on its calendar, but folks there aren't satisfied. “We strongly believe Moore County has not realized its potential to host sporting events,” according to Caleb Miles, executive director for the area's convention and visitors bureau.

So to attract even more sporting events, the CVB and the county's parks and recreation department have jointly formed the Moore County Sports Council. The council will work to promote Moore County as a site for amateur and professional sporting events.

The council's first task will be to create a comprehensive inventory of existing and planned sports facilities in the area. An eye also will be given to deciding which facilities will need to be improved or expanded.

Miles said the council plans to create a “hit list” of events it would like the area to host and then determine the protocol and criteria for hosting them along with the bid preparation procedure.

Moore County already well knows that hosting major sporting events is a boon to the local economy through the additional revenues generated by visitors. By attracting even more events, the entire county should benefit even more, Miles and others believe.

High Point uses eight million square feet of exhibit space to stage the International Home Furnishings Market every spring and fall. In just the last few months developers have announced they will add at least two million more square feet to that total and invest $120 million.

Announcements about the construction of new showroom space came so often that they sometimes stole the show from each other. Two different groups announced on the same day that each will develop a new showroom, with their combined space totaling 918,000 square feet.

Downtown is definitely the place to be. Market Square has built a three-story, 350,000-square-foot expansion costing $20 million. Easter & Eisenman, the commercial developer that created the other hot spot in High Point for commercial development, Piedmont Centre, plans a four-story 218,000-square-foot building that can be expanded to 600,000 square feet. Showplace, once renowned for being held in a series of tents in a parking lot downtown, will open this October as a permanent $40 million, 450,000-square-foot building that will also act as a downtown convention center for the city when Market is not in town. The International Home Furnishings Center, a giant, 11-floor showroom building that already dominates downtown High Point, will add a 180,000-square-foot 12th floor.

Downtown is so popular that still-serviceable buildings that have nothing to do with furniture are being torn down or extensively renovated to put up new showroom space. Hall Printing Co., a fine art printer just a block off South Main Street and close to the International Home Furnishings Center, is one such building. Going too will be Wright's Clothing Store on South Main, which will be renovated into a five-story, 40,000-square-foot showroom and office building, as well as the Law Building, an old office building that's also slated to be renovated. Also on its way out is the Ramada Inn, a 38-year-old, 136-room hotel located directly across the street from some major showroom space. Once the hotel is torn down this spring construction can start on the Merchandise Mart's Market Square on Main, a 450,000-square-foot, $40 million showroom that is a separate project from the same company's Suites at Market Square project that just opened a few hundred yards away.

Ron Stephens, vice president of sales and marketing for the High Point Convention and Visitors Bureau, says he is now researching what types of conventions he can attract to High Point's new showroom space. He hopes to find other, smaller shows that have some tie to home furnishings such as Showtime International, a fabric show that comes to High Point twice a year. Showtime's 3,000 buyers purchase the fabric that eventually shows up as upholstery on the sofas and chairs shown at Furniture Market.

Stephens estimates the city will add 900,000 square feet of temporary showroom space that can be rented out to various conventions.

“Initially, we will target those shows that are somehow loosely affiliated with Market. I looked at one yesterday called The Alternative Bedding Show, which sells futons. Maybe there is a mattress show we can go after,” Stephens says. “When I can use the hook of High Point having the Market, I think we can generate some interest.”

Stephens also knows that to get those conventions the city will have to attract more full-service convention hotels to the downtown. Once the Ramada is torn down, only the Radisson will remain. But he also figures that convention space draws conventions which will draw hotel interest. In just the last few months Stephens has talked to three different hotel chains about building downtown — on lots that aren't now being eyed by the furniture showroom developers. —Clint Johnson

 

Can-Do Attitude Behind Iredell's Growth
By the time guys like Rob Whitener come knocking, Jeff McKay figures they've fiddled around enough. “They might have spent months or years making the decision to relocate or expand, but once they decide, they need it yesterday,” he says. “Our job is getting it for them yesterday.”

On the west side of Statesville, two years after Whitener invested $7.5 million to establish Eclipse Packaging Co., his company is already expanding. And Eclipse is adding to a record that Site Selection magazine says made the Iredell County town the nation's best for its size at attracting industry in the decade just ended.

McKay, director of economic development at the Greater Statesville Development Corp., his boss, R.B. Sloan Jr., chairman, and newcomers like Whitener attribute the record, which averages 10 new and expanded industries per year, to a number of factors.

Some come with the turf, such as the intersection of interstates 77 and 40 in Statesville, and proximity to Winston-Salem on one side, and Charlotte, with its 500-flight international airport, on the other. Even Iredell's tight labor pool, adds Jean Manall, manager of the N.C. Employment Security office in Statesville, has a bright spot. Although unemployment hovers around 2 percent, workers are ample in counties like Wilkes and Alexander to the north and west.

But companies like Eclipse, which supplies food industries with such products as vacuum packs for meats, underscores that there's more to it than that. Whitener searched from Roanoke to Raleigh, Charlotte and Morganton before settling on Statesville. “We had our first full production year in 1999, and we've done well enough that we've doubled the size of our building and are adding a third production line,” he says.

Typically, such prospects are welcomed not only by McKay, but a corps of volunteers from Statesville's business community. “When a prospect comes in, Jeff lines them up with an industry that's already here,” says Sloan, who's also chief executive of Energy United, the regional electric co-op. “Our best salesmen are the people we've already recruited.”

After the sale, McKay and Sloan say local elected officials and administrators fast-track permitting, utilities and zoning if necessary to accommodate the precision manufacturing, automobile racing and similar high-investment, high-paying industries they target. “We try to get them to the point of making money as expeditiously as we can,” says McKay.

And, while Statesville shines in Site Selection's March-issue rankings, another Iredell town — Mooresville — is close behind in third. That, says Melanie O'Connell Underwood, executive vice president of the Mooresville-South Iredell Chamber, can be attributed to similar factors, but also, her area's influx of stock-car racing teams and supporting industries. Average salaries in the racing industry, she notes, are in excess of $40,000 a year, about 80 percent above the county norm.

Those factors add up to big numbers. For Iredell as a whole, in the last five years alone, N.C. Department of Commerce figures show 155 expansions and new businesses, investing $586.6 million and creating 4,909 jobs.

“We've got a lot of what most people would like to have if they started out with a blank sheet of paper,” says Sloan. —Edward Martin

 

Queen City Wins a Beauty Prize
May in North Carolina is late fall in Auckland City, New Zealand, among the cities that Charlotte defeated in something called Nations in Bloom. That's a global contest akin to, “My daffodil can lick your flax lily with one pistil tied behind its back.” Others in Charlotte's middleweight classification of 300,000 to a million population included Lisbon, Portugal, and Hannover, Germany.

“They're called the `Green Oscars,'” says Mark Gillespie, a parks and recreation official who headed Charlotte's delegation to Japan to make its case as one of five U.S. finalists in the competition, which is endorsed by the United Nations.

While Charlotte won't be bashful about using the award in economic recruiting and promotion, local officials say that behind bragging rights are serious issues of public policy, land-use decisions and private-sector involvement, along with some daunting challenges for the future.

The competition, which is sponsored by an international parks federation based in England, views video presentations of flower power, but is weighted even more heavily toward less colorful considerations — heritage management, landscape enhancement, community involvement, planning, and environmental sensitivity. Charlotte placed second in 1999.

“The judges take into consideration such things as cultural and geographic differences,” explains Gillespie, who manages park services within the Mecklenburg Park and Recreation Department. “They want to see how cities apply the principles. For example, in Japan, you don't have the large, open parks and green spaces like in this country.”

In fact, Charlotte did indeed get high marks for its 5,000 acres of such spaces in Reedy Creek, McDowell, and Latta Plantation parks, but also for forward-looking moves such as last fall's $220 million land-bank bond referendum to buy acreage for more parks and schools, before it's developed. The city, along with the federal government, also recently approved a $10-million plan to buy and remove flood-prone homes and turn a number of streams into greenways.

And while highly landscaped, private-sector business parks were a part of the presentation, such efforts as a burgeoning antisprawl movement by the small towns of Davidson, Cornelius and Huntersville were factors, too. They're buying land and developing zoning to preserve open space by concentrating development along a future commuter-train route. “Revolution doesn't start in the capital,” explains Tom Low, a Duany Plater-Zyberk & Co. architect advising the three towns with their initiatives. “It begins in the countryside.”

But if Auckland and other cities are already getting ready for next year, so's Charlotte. A repeat win is by no means assured, considering the pressures of rapid development, air pollution and growth. “What we're really looking at,” says Gillespie, “is how the total package of beauty, planning, open spaces and environment contribute to the longterm liveability of the community.” —Edward Martin

 

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