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Barbara Perenic/Staff Photo
Jeff Johnson, Director of Operations for Avetec which is in NextEdge Park in Springfield Ohio.
Hopes remain for more jobs at tech development
Tech park has struggled to meet expectations.
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By Everdeen Mason,
Staff Writer
Updated 6:29 PM Saturday, February 11, 2012
SPRINGFIELD — Millions of public dollars helped develop a high-tech park that has nearly 200 acres of vacant land and has yet to create the number of jobs expected.
NextEdge Applied Research and Technology Park was hailed as Springfield’s future when manufacturing losses mounted last decade.
About $6.3 million in public funding was spent on infrastructure and another $3.1 million was spent on the Mills Morgan office building that houses businesses such as Qbase and Science Applications International Corporation.
The park now has three buildings and five companies that employ an estimated 100 people.
Major players in the park, such as the Turner Foundation and the city of Springfield, said the park is a success and will be viable later.
“The project itself is still secure,” said Tom Franzen, the city’s economic development administrator.
Franzen said the goal of NextEdge was to have a functional site complete with utilities and infrastructure to attract businesses to the area.
“From a long-term approach, it’s still a good idea,” he said. “It was a good investment to help attract (high-tech) types of industries.”
One of the businesses attracted, Qbase, received more than $4.3 million in public money to locate in Springfield and bring jobs. Qbase, along with Newport SpectraPhysics, did not return calls and has not disclosed the amount of jobs created.
Franzen said the park has generated tax revenue from occupied and vacant land. For the three occupied properties in NextEdge, a total of more than $265,780 in property taxes was paid last year, according to the county auditor’s office. Franzen said those properties also provide utility payment revenue and income tax revenue.
The decision to create NextEdge stemmed from two situations. First, LexisNexis wanted a backup facility after Sept. 11, 2001, and the city had only one place to sell them. Also, Springfield’s livelihood — manufacturing — had declined.
“We discussed the opportunity to diversify our job base in Springfield,” said John Landess, executive director of the Turner Foundation. The foundation spent “substantial” amounts of money — although Landess did not have exact figures — on NextEdge until the vacant properties were turned over to Fifth Third Bank.
“Part of the issue is that in 2008, we ran headlong into the recession, and the high-tech industry almost stopped all growth,” Landess said. “Only now are opportunities growing again. Just last year, SAIC expanded.”
SAIC — which does research and engineering for the oil and gas industry, government and more — received $550,000 in grants from the state for a regional expansion last fall. The Springfield location at 250 Veronia Dr. received $150,000 of that funding in exchange for bringing 30 jobs to Springfield, said Dennis Andersh, senior vice president and Dayton regional executive in a statement.
The business has filled 15 jobs since then, bringing its total employee count to 17 people.
The expansion has had a ripple affect on the park.
Mills Morgan, where SAIC is housed, is now about 50 percent occupied thanks to the expansion, said Todd Duplain, director of development for Mills Morgan Development. The building currently houses offices for SAIC, Newport SpectraPhysics and Qbase.
There’s also an opportunity for growth, as Mills Morgan has seen an increased interest in property, Duplain said.
“We have two lots for additional buildings out there, 10 additional acres we hope to start building on,” Duplain said. “But we won’t start until the first building is full or close to full. We need to lease another 20,000, 25,000 square feet, and then we’ll start the second building.”
The success of SAIC and potential newcomers helps the success of other businesses located in the park.
Businesses that come into NextEdge often have similar types of business and a high level of scientific computing, which gives a greater chance of attracting contracts and other businesses, said Homer Smith, CEO of Avetec, a non-profit that is contracted to do research and development on new technology.
Smith said increased business in the park also keeps employees in the area while providing them ways to move up and a variety of companies to satisfy their needs without leaving the region.
“We don’t have scheduled meetings (with the other businesses), but we see each other frequently and exchange openly,” Smith said.
Avetec has been able to maintain steady business over the years, but is reliant on the government.
“Our work is based on the needs of the government,” said Smith. “Business slowed down because of the federal budget. We’re doing well, holding our own.”
The same cannot be said for the nearly 170 acres of NextEdge owned by Fifth Third Bank. The bank took over ownership of the property in July 2011 after the Turner Foundation pulled financial backing and development slowed.
“No one is selling vacant land in the market anywhere unless it’s at extremely discounted prices,” said Jeff Levine of Levine Realty Co., which represents Fifth Third Bank and NextEdge.
Fifth Third Bank officials confirmed that they attempted to auction the property in November and that the final bid of $3.8 million did not go through for undisclosed reasons. Levine said the final bid did not meet the undisclosed asking price, so Fifth Third kept the property.
For now, Levine said Fifth Third is marketing the parcels as usual by listing it with local real estate brokers and introducing it into the market that way.
“Things possibly will change within the next several months because Fifth Third is constantly reevaluating troubled properties,” Levine said.
If the time comes, the bank may try to sell the land again.
“It just may come to the point where they’re going to sell it for something less,” Levine said.
Contact this reporter at (937) 328-0371 or emason@coxohio.com.
Dollars spent in NextEdge
$6.3 million for the main infrastructure of the park from federal, state and local funds.
$3.1 million for the Mills Morgan Development building from the Ohio Department of Development
$500,000 to Qbase from Clark County, Springfield City and the Community Improvement Corporation
$3.6 million to Qbase in grants, tax credits and low interest loans from the Ohio Department of Development
$200,000 to Qbase from the department of Jobs and Family services for job growth
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