Recruitment Tool Tightens Up

Land scarcity and costs in Northwest Arkansas are causing significant shrinkage in public industrial park space, local economic development leaders said.

In Arkansas, there are 75 industrial parks, typically infrastructure-laden havens that are used by cities, Chamber organizations and development groups to recruit light- to medium-manufacturing. The sites offer a combined 59,427 acres statewide.

The eight industrial parks across Northwest Arkansas, including one in Harrison, account for a local designated economic development area of 3,111 acres, or about 389 acres per site. That’s only 5.2 percent of the total state offering.

Arkansas’ 67 other sites have 56,316 combined acres, or about 841 acres each. The complete listing is available online at Arkansasbusiness.com.

Bill Rogers, vice president of economic development for the Springdale Chamber of Commerce, said larger land tracts in other parts of the state are simply more affordable for cities to develop.

“Two things are noteworthy for this in Northwest Arkansas,” Rogers said. “It’s very hard to find land that’s affordable and that you can get utilities to. Land that’s accessible by rail is pretty scarce up here.

“Automobile assembly plants, for instance, want to be near two interstates and two different points of rail access. We simply don’t have that much rail. You can always run a spur to a pretty piece of property, but that doesn’t mean it’s cost effective.”

The good news in Northwest Arkansas is that its industrial parks are on average closer to more utilities and infrastructure than in most other parts of the state. All eight local parks are within 17 miles of a major airport. Five of them have on-site railroad access and all of them are close to interstates, including five that are within five miles of major highways.

The Arkansas River Valley even offers deep water ports on the Arkansas River, which thanks to Interstate 540, are also within reasonable proximity (about 80 miles) of Fayetteville.

As local industrial parks run out of inventory though, land costs and improvements can escalate quickly.

Rich Davis, economic development director for the Bentonville-Bella Vista Chamber of Commerce, said his city paid $10,000 per acre for its new Bentonville West Industrial Park on Chucker Road. The 145-acre park is the result of the city’s old one, the 100-acre Southeast Industrial Park at 28th and “J” streets, getting filled up at the end of 2002.

The west park is a public/private collaboration between the city and the Bentonville Industrial Development Corp., a nonprofit organization.

The new park was strategically set up just two miles from the Northwest Arkansas Regional Airport. Davis said land prices in that area now are 2.5 to four times as high per acre, so Bentonville is lucky to have already acquired the property.

“It’s all about creating jobs,” Davis said. “There have been opportunities in the past to sell industrial park space for speculative projects, but Bentonville has chosen not to do that. We’ve focused on bringing in industries that will create jobs. We’re not talking about smokestacks, but some of this new-age, high-tech business that creates knowledge-based jobs and typically pays workers higher wages.”

Rogers said private development in Northwest Arkansas continues to fill a lot of industrial needs. But maintaining a network of public park options gives economic developers more options when recruiting some larger industries.

“Being able to offer an affordable location that’s convenient to rail, an airport, interstate and that has good utilities is a very important tool in our tool chest,” Rogers said.