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Does Center for Business and Education meet Yellow Springs business needs?

 

Central to the question of whether Village government should contribute $700,000 to completing the infrastructure of the Center for Business and Education, or CBE, is whether such a commerce park would meet the needs of businesses already here. While CBE advocates hope that a “shovel-ready” business park would attract new companies to town, they also see the CBE as the answer to the concern frequently voiced, that in Yellow Springs, small but successful businesses have no place to grow.

And without places in which to expand, Yellow Springs will lose its most successful small businesses, along with the vitality and economic contributions that they bring, CBE supporters say.

“The consequence of not doing this is that we continue to march toward being a bedroom community of Wright Patterson,” Roi Qualls, retired owner of eHealth Data Solutions, said at Monday night’s Council meeting.

CBE advocates also say that Yellow Springs needs all the jobs it can get. In the decade between 2001 and 2011, the village lost 393 jobs, according to Census data released last spring. The loss coincides with the moves of two of the village’s largest employers, Vernay Laboratories and Antioch Publishing, to other locations.

But some wonder if an industrial park, in which relatively small businesses will need to fund construction of a new building, is the answer to local economic development needs.

A part of the local business community for almost 40 years, Roy Eastman, owner of Electroshield, remembers talk of the Village building a commerce park in the mid-1980s.

“We probably should have done it then,” he said in a recent interview. “If we had done it back then, it would be slow to fill up but now we’d have it.”

However, Eastman’s concern is the feasibility of expecting young companies to take on that much financial risk. He estimates that his company would need more than $1 million to construct a space in the CBE comparable to the one he currently owns on High Street, much more if the space were larger.

“When I needed the space, there was no way I could afford that,” he said.“Businesses coming up are not at a stage where they can make that jump. My concern is always, how do we get a start-up business that can afford to do that?”

Dan Dixon shares Eastman’s concern. His company, LaserLink is “the one that got away” from Yellow Springs’ local economy. Started in Dixon’s home, the business, which manufactures industrial gauging equipment, was bursting its seams in a small downtown facility for several years as Dixon tried to find a suitable local space to expand, he said in a recent interview. Finally, in 2007 he gave up and moved his 12 employees to a 20,000 square feet building near Fairborn.

While he considered building a facility locally and space was available, Dixon decided against it.

“We ultimately decided we didn’t want to focus our time and energy on designing and building a building,” he said. “When you’re a growing small business that has to be reactive all the time, taking on that responsibility” seems a poor use of resources. “I suspect it won’t be the most attractive thing to other businesses in our position,” he said.

In interviews with eight small but growing local businesses recently, most echoed the concerns of Eastman and Dixon. If they need to grow, the owners said, they will focus on putting money into their business rather than constructing a building.

However, a few business owners said they might be candidates for building in the CBE at some point, though they emphasized that would be far down the road.

It’s not the responsibility of Community Resources, which owns the CBE land, to worry about how buildings will be built, CR board member Jerry Sutton said.

“I’m trying to take a small step here,” he said this week, of trying to secure from the Village funding for the infrastructure development. “My agenda is not to take the next step, of building the buildings.”

Sutton and Dixon agree that the village needs to be proactive to get more business in town.

“If the village doesn’t have an economic base and we’re just a bunch of retired people, it won’t be a viable community,” Dixon said.

Local business needs

Glen Courtright’s EnviroFlight has drawn the national media to Yellow Springs in recent months, as journalists see Court­right’s product, an insect-based animal food, as a new and creative contribution to solving the social problems of world hunger and environmental sustainability.

The recent media focus has brought in new customers, Courtright said in an interview last week, and he’s dancing as fast as he can to catch up with increased demand. Currently, EnviroFlight has eight fulltime employees, and he aims to pump up his product development and research components, which will mean hiring about 10 more employees, if growth continues.

Currently, he is trying to maximize the space available at MillWorks. But if growth continues, “We’re going to grow out of MillWorks,” he said.

While Courtright declined to comment, Antioch College President Mark Roosevelt this week confirmed that EnviroFlight and the college are in talks regarding the possibility of the business moving to a building on campus.

“It’s not finalized, but the business is consistent with our food and environmental concerns,” Roosevelt said. “I hope the discussions are fruitful.”

However, last week Courtright said he’s keeping his options open. And while he didn’t rule out that he could be a candidate for the CBE, he indicated that the cost of constructing a new facility would give him pause.

“At this stage in our development, building a building is a big leap,” he said. “You need to stay focused on your business and I’m in technology development, not the real estate business. For me, it would come down to a cost/benefit analysis.”

Another growing local business, Yellow Springs Brewery, has no immediate plans to move out of its MillWorks location, where it opened less than a year ago.

However, co-owner Lisa Wolters said recently, “If interest in the Brewery continues, it seems quite possible that we will expand our production facility. It’s not outside the realm of possibility to build in the future, but we have no plans to do so now.”

Another MillWorks business, Kelley Equestrian, a wholesale distributor of horse products, periodically considers moving into a bigger space although it’s currently in “recovery mode” after the recession, according to co-owner Nancy Kelley. The business employs five people currently, including herself.

But if they need more space, they would not choose to own their own building, she said.

“I would not own commercial real estate because it’s a bad investment,” she said. “I’ll be a renter.”

One of the village’s oldest and largest small businesses, Electroshield, started in 1976, is a distributor of electronic components. The company employs 18 people.

The company owns its High Street building, which it bought years ago when it needed to expand. It was inexpensive space, pretty much a shell,” Eastman said. “We didn’t have much money but over the years we’ve fixed it up quite comfortably.”

But the company “is close to the end of the projects we can do here,” Eastman said, and could be a candidate for the CBE at some point. However, any move would take place after he retires, which he projects will happen within a few years.

But Eastman wonders whether the Village should move ahead with financing the CBE, if it means having fewer resources for other Village needs. While it would be good to have such a facility available, he doesn’t want to see the project trump other amenities, such as support for a robust arts scene and good schools, which he believes are ultimately what draw new businesses to town.

“I believe the success of all of these is connected,” he said.

Another robust small local business, Ertel Publishing, employs 12 people, including writers and photographers, in its work publishing hobbyist and historical magazines, according to owner Patrick Ertel last week. The company owns its High Street building and has no plans to move — it has room to expand if it needs to, in space it now rents out.

Rather than putting substantial Village funds into a new commercial park, the Village should fix up its infrastructure so that those currently working in town want to stay, Ertel said, citing the experience of a new employee who moved from out of state only to discover local brown water and subpar pavement.

“I’d rather see the Village address those issues so people here now can have good streets and water,” he said.

Another new business currently housed in MillWorks, S&G Artisan Distillery is this winter expanding its tasting room space, where customers can try out the company’s distilled spirits. But the three main principals in the company still have day jobs, according to co-owner Meg Gujer, so they have had limited time to put into their business.

Significant expansion won’t come anytime soon, and the distillery owners are pleased with their current MillWorks location, she said. Especially, they appreciate that having two tasting rooms at MillWorks — theirs and the Yellow Springs Brewery — seems to benefit both businesses.

“It’s a nice symbiosis now with the brewery there,” she said. “I’m not looking to get rid of that soon.”

A longtime local business, Anthrotech, owned by Bruce Bradtmiller, has no plans to move its five full-time and several part-time employees out of its Xenia Avenue location.

“We do not have any thoughts of leaving at all,” Bradtmiller said last week. “You’d have to pry us out of here.”

The company rents out one apartment in its structure, formerly a historic home, and thus could expand easily if it needs to, he said.

A representative from eHealth Data Solutions did not return phone calls this week.

A local business that does plan to leave the village soon is Servlet, the local Internet service company owned by Bruce Cornett. Recently, the company, which has four full-time employees, has expanded its current space in Dayton and added space in Columbus, although it will maintain an office in Yellow Springs, according to Cornett.

In general, Cornett supports the Village supporting development at the CBE, he said.

“I do generally think it’s a good thing for local government to be involved in the likes of the CBE,” he said. “But as they say, the devil is in the details.”

However, it’s unlikely that Servlet will ever be a candidate to move there. The company is leaving the village not due to the need for space, but for more bandwidth capacity, which is less expensive in urban locations, he said.

What’s here already

As part of the CBE discussion, it seems timely to look at other options available to local businesses that need to expand.

The former Creative Memories building on Dayton Street is a large commercial space that has partly stood empty for two years but is newly available for business development, following its sale last week.

The buyer is an investor group called Yellow Springs, LLC, according to the group’s representative, Russell Maas, a principal at the commercial realty business NAI Dayton and the investor group’s real estate advisor. In an interview last week Maas said he could not give the investors’ names or even their state of residence, but he described them as “West Coast, very creative, very entrepreneurial.”

“They want to be creative in how they utilize the space,” Maas said in an interview, stating that the investors have “talked about the possibility of a business incubator or accelerator.”

The building’s current occupants, Antioch University and eHealth Data Solutions, are expected to stay, according to Maas.

The space available includes 26,823 square feet of “recently renovated office space” and 30,000 square feet of high-bay warehouse, Maas said.

“The investment team has a number of wonderful ideas on how they intend to lease the space and re-brand the building as a place for budding entrepreneurs,” he wrote in a press release.”

MillWorks full

Started in the 1990s, MillWorks, a 43,000 square foot facility for business use between Walnut Street and the bikepath is “pretty much full,” according to co-owner Ellen Hoover in an interview last week. Other partners are Rod Hoover, Sandy Love and Sam Young.

It took until about a year ago to fill up the space with businesses, according to Hoover, although MillWorks has been largely filled for some time. Currently, its 16 businesses (with 30 employees) include some office, some production and some warehouse space.

About 50 percent of MillWorks’ current businesses came from out of town, she said, such as S&G Artisan Distillery and EnviroFlight. Some businesses settled on MillWorks because MillWorks was able to respond to their specific needs and some, such as EnviroFlight, because they were attracted to the Yellow Springs community, Hoover said.

“It hasn’t been hard,” to find businesses to come to MillWorks, Hoover said.

Hoover, a former member of Community Resources, has been an advocate for the CBE because she wants the businesses that start up at MillWorks to have someplace to grow. She also believes there are a couple of local businesses “growing out of their homes” (she wouldn’t say which) that might need more space soon.

However, as former economic development director of Springfield, Hoover said she understands that having facilities already constructed can make a commerce park more viable.

“I’m not questioning the need for a park,” she said. “But when I was doing this work in Springfield, if I had a spec building up, I could get something going. People can’t visualize very well, until they have seen something over and over.”

College not there yet

In its past, Antioch College spawned the bulk of the businesses that have been the largest employers in the village, such as Yellow Springs Instrument (now YSI/Xylem) Vernay Laboratories and Morris Bean, among others. And that history is significant, according to college trustee Lee Morgan.

“Clearly the college wants to encourage entrepreneurship,” Morgan said in an interview last week.

However, while rumors fly about potential business development projects, the college, focused on renovating buildings for students and creating environmentally sustainable energy sources, is not able to invest in a business incubator at this time.

“In general, the cost of rehabbing the building has been the obstacle,” Morgan said, referring to the potential to use the Fels or Sontag buildings as an incubator. “I don’t think the college is quite there yet.”

But one person who is there, or rather here in town, is college alum Roger Husbands of the Bay area. A 1963 Antioch College graduate, Husbands has moved to town for three months to test the waters around launching a business incubator.

“I’m a serial entrepreneur,” he said. “I love starting up things.”

Specifically, Husbands has been won over by an international business development movement called Impact Hub, which seeks to create open work spaces for start-ups that provide answers to social problems.

“The concept is to promote networking, to build a community around entrepeneurship,” he said.

Husbands sees the college’s Fels Building as a potential site, and Impact Hub as a perfect fit with the college’s progressive, activist history.

Initially, Husband hopes to build a team of about five people, including representatives from the village and the college, who want to work with him to find the 200 members necessary to create a local Impact Hub.

President Mark Roosevelt this week emphasized that, while the college has other more immediate needs, it hopes at some point to provide a space friendly to business entrepreneurs.

“It’s down the road,” he said, “but it’s totally consistent with what we want to do here.”

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