GREENSBORO — Guilford County got the best of both worlds Thursday.
American Express has decided to locate a $400 million data services center in the eastern part of the county and agreed to do so without requesting any local financial incentives.
“I would say congratulations to all of us. This is a big deal. A big deal,” said Pat Danahy, president and CEO of the Greensboro Partnership.
It also is a big deal that the company decided to forgo incentives. The decision left local leaders puzzled but delighted.
“That’s refreshing,” said Keith Debbage, a professor of urban geography at UNCG. “I suspect a major reason for this is (their) level of familiarity with the marketplace. Greensboro is no stranger to American Express.”
The company already has a large call center at 7701 Airport Center Drive. That operation opened in 1985 and employs about 2,000 people.
Debbage said the company could have other reasons for eschewing incentives.
“I suspect they don’t want people poking their noses in their business.” he said. “It is also possible that a rapid decision is needed, and they didn’t feel the need to get tied up in the public realm.”
At one point, local officials said city and county governments would consider putting up as much as $13 million in incentives. Some would have come in the form of infrastructure improvements. That would have been the largest outlay ever for area municipalities.
Greensboro and Guilford County tentatively had scheduled incentives hearings related to the project but quickly canceled those efforts.
Guilford County had been competing with Des Moines, Iowa, for the center.
Data centers such as the American Express project are huge computer storage facilities that preserve company information.
Local officials said American Express will build two buildings in eastern Guilford County. One will go up at a 100-acre site at Rock Creek Center, an industrial park south of Interstate 40-85 that is seven miles east of Greensboro, according to Assistant City Manager Andy Scott.
Richard Beard, a partner with Simpson Schulman & Beard, the company that manages and markets Rock Creek, declined to comment.
The other building will be at an undeveloped corporate park across Interstate 40 from the first site. That site is owned by developer Roy Carroll. The cost of the land transactions could not be determined Thursday.
The buildings will go up one after the other. The larger will be built first at Rock Creek and cover 350,000 square feet and cost between $350 million and $400 million. It will serve as the main data center.
The second will be 150,000 square feet and act as a back-up for the main building. Its cost could not be determined. It will be built in about two years, Scott said.
The Carroll property likely will be annexed into the city. It will need water and sewer access, Scott said.
Initially, the company will employ 50 to 60 people, but that number could grow to 150.
Several attributes lured American Express to the Triad: a strong, uninterrupted power supply from Duke Energy, well-positioned Internet cables and a location generally free of natural disasters.
Experts say more data companies will take a hard look at coming to Greensboro after the American Express deal.
“Sometimes we see the effect of data center clustering,” said Rich Miller, editor of Data Center Knowledge, an online news service. “One company will identify an area as being ideal for a data center and others will follow in short order.”
Dan Lynch, president of the Greensboro Economic Development Alliance, the city’s top economic developer, said American Express counts as a bull’s-eye for this city’s business recruiting strategy, which includes data centers.
“It’s in the sweet spot of our marketing strategy,” Lynch said.
The initial investment could exceed $400 million. Local officials have said the project ultimately could exceed $1 billion.
“It remains to be seen how big it might become,” Danahy said.
The city will earn an estimated $1 million in annual property tax revenue from the facility when it is fully operational, Scott said. Guilford County stands to make two or three times that amount from property taxes on both facilities, he said.
Danahy said he did not know the company’s timetable, but he added, “they are anxious to get going.”
American Express notified local recruiters of their decision Wednesday night. The company declined to discuss its decision.
“Our policy is not to comment on our technology facilities,” said Susan Korchak, a spokesman for American Express in New York.
The Triad has plenty of experience with big-dollar incentives packages. They include Dell, which built a factory in Forsyth County in 2005 with about $280 million in state and local incentives, $37 million of which came from local sources.
FedEx built a massive package-sorting plant at Piedmont Triad International Airport with a $500 million package of incentives from the airport and state and federal governments.
Dell said last year it would close its plant, but it continues to operate at reduced capacity. And FedEx is running at minimal levels until the economy improves, the company has said.
Still, a few companies have opened major operations with little or no incentive money.
Lenovo opened a computer distribution center in Whitsett in 2008 with no public incentive money.
In 2007, Kay Chemical said it would spend $12 million to expand its plant despite being rejected for county incentives.
And Honda Aircraft got a relatively modest incentive package of $8 million for its $100 million headquarters and assembly plant at PTI.
Commissioner Paul Gibson said he applauds American Express.
“They did the right thing,” he said. “They came for good business reasons.”
Staff Writers Amanda Lehmert and Donald W. Patterson contributed to this report.
Contact Richard M. Barron at 373-7371 or richard.barron@news-record.com
Contact Mark Binker at (919) 832-5549 or mark.binker@news-record.com
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