Aerotropolis

Business, North Carolina, Jul 01, 2007 by Speizer, Irwin

Some said their goodbyes to a way of life they expected to soon vanish. South of the city, the Neuse River would still spill into the swamps, but before long the narrow blacktops through the cotton fields around Kinston would be packed with commuters and trucks. There would be suburbs in the roadside fields where roasting ears and cantaloupes grew. The city would be here still - it has been since the 1790s - but new buildings would give it a skyline.

This is what was going to do it: a modern airline terminal, tan and clean-looking, surrounded by parking lots.

Across a strip of concrete, several boxy warehouses shimmy in the heat rising from the two-mile-long runway. A new brick-and-glass building with an entrance like a small rotunda shelters training rooms with the latest in audio-visual equipment.

The North Carolina Global TransPark was going to change everything. Instead, farmers still grow cotton and roasting ears in Lenoir County. And on a damp morning in downtown Kinston, you can still catch a musty whiff of century-old buildings. At the futuristic cargo airport that was supposed to revitalize the region, the big parking lot is often deserted, and sometimes at midday an eerie silence prevails.

Not that the idea wasn't catchy. Build it - a modern, well-equipped airport that caters to manufacturing and business - and tenants would come. Big-name computer companies assembling high-dollar machines for worldwide markets. Makers of time-sensitive electronic wizardry. Maybe even exotic-car manufacturers locked into just-in-time production schedules dictated by waiting Hollywood stars or wealthy oil sheiks.

The idea is still appealing. It's happening, in fact. Just not here, north of Kinston, in a place that time still seems to have for-gotten. The marketplace has spoken, and it said Greensboro - specifically, Piedmont Triad International Airport. "We have become the Global TransPark by default," says Dan Lynch, president of the Greensboro Economic Development Alliance.

In the late '90s, when Memphis, Tenn.-based FedEx Corp. went shopping for a sorting hub, Piedmont Triad International beat out the TransPark for the $350 million project. Earlier this year, the Triad airport pulled off another coup: the $60 million headquarters and factory for Tokyo-based Honda Motor Co.'s HondaJet, a new light aircraft aimed at the corporate market. The TransPark's biggest success so far is a second-place finish for a Boeing aircraft plant. "I would have hoped that the Global TransPark would have been much further along," says John Kasarda, the UNC Chapel Hill professor who came up with the idea of an airport-based economic engine nearly 20 years ago.

Then again, Kasarda never expected the fruit of his intellectual labor to end up in remote farmland. He had envisioned an airport as the center of a logistical network that included highways and rail lines, a strong trucking industry and an industrial work force - in short, a place like the Triad or Charlotte. "Kinston was not the ideal location," he says. N.C. Secretary of Commerce Jim Fain remains optimistic: "I continue to believe that the TransPark could become a center of transformational economic impact. It just takes finding the right client."

What the disparity between Kinston and the Triad points out is the difficulty of using government intervention to redirect market forces in the service of societal and economic change, especially when the target region is so far behind in development-ready infrastructure. To date, public funding of the Kinston project has reached an estimated $112 million, and the state provides $1.6 million for annual operations.

The Triad appears to have prevailed because of old-fashion capitalism that values its more-centralized location. It's moving up in stature as a cargo center as the FedEx hub nears completion. Logistics Today magazine, in its rating of the 50 top logistics-friendly cities and metropolitan areas, ranked Greensboro-High Point tops in the state and 20th in the Southeast last year, up from 31st in 2005. It passed Charlotte-Gastonia-Concord, which slipped from 18th in the Southeast in 2005 to 22nd. Raleigh-Cary came in 28th in the Southeast in the latest ranking. Kinston wasn't on the list.

It's not that the other airports have no government investment. An estimated $190 million has gone to improve the Triad air-port and surrounding infrastructure to accommodate the hub. But the money has been spent in response to a development project, not in advance of one, as was the TransPark's case. Most of all, the work adds to an established network of highways and rail lines and an existing regional airport. Large airport developments need more than just a landing strip surrounded by cheap land. "It is so clear to me now that the factors that will drive a successful aerotropolis are probably not present, at least right now, around the Global TransPark," says Don Kirkman, president and CEO of the Piedmont Triad Partnership.

Both the Triad and Charlotte fought hard to win the project after Kasarda proposed it in the late 1980s. Just-in-time manufacturing was a hot concept, as was global sourcing of goods and production. Airports were becoming more important as hubs in the development of more-efficient industrial logistics. Kasarda, who would go on to become director of the Kenan Institute of Private Enterprise and Kenan Distinguished Professor of Entrepreneurship, came up with the idea of development zones tailored to companies needing fast shipping, including a landing strip long enough to accommodate large cargo jets. He envisioned businesses clustered on or near runways, enabling instant loading and unloading of goods from planes.