For Davenport Mayor Mike Matson, the recent decision by Fair Oaks Foods to build a $134 million pork production plant in his city sends an important message about the region: “Davenport is open for business.” And so is the Quad Cities, he said. ”Their investment in our community shows that the QC and Davenport is […]
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For Davenport Mayor Mike Matson, the recent decision by Fair Oaks Foods to build a $134 million pork production plant in his city sends an important message about the region: “Davenport is open for business.”
And so is the Quad Cities, he said. ”Their investment in our community shows that the QC and Davenport is the ideal place for companies to locate and grow businesses.”
There is growing evidence to suggest that is true, and also to show that projects like this don’t happen by accident. Rather, they are the product of planning, preparation, and collaboration by a committed group of business, government and development players.
Take Fair Oaks Foods’ plans for a 150,000-square-foot fully cooked bacon production facility that it announced on Tuesday, June 14. The new project will be built at the Eastern Iowa Industrial Center (EICC) and near the Amazon robotics fulfillment center now under construction.
The Fair Oaks development – that will employ 247 area workers – was a year in the making. Construction is expected to begin this summer on the 32-acre site near Interstate 80. The company plans to start operations in early 2024, according to Fair Oaks Foods, the City of Davenport, the Greater Davenport Redevelopment Corporation (GRDC) and the Quad Cities Chamber of Commerce.
The family-owned processing company, headquartered in Pleasant Prairie, Wisconsin, was founded in 1985 and has grown to become the 11th largest black-owned business in the United States. It produces and supplies a variety of protein products.
On Wednesday, June 15, the project took another step forward when the Davenport City Council gave preliminary approval to a resolution of support and financial contribution. Under the agreement, the city would provide a 60% tax increment financing (TIF) rebate to the company for 15 years, minus $1.1 million for the upfront cost of a pretreatment facility.
Then, on Friday, June 17, Joseph Freda, Fair Oaks’ chief operating officer, told the QCBJ “We received the award today from the IEDA for the High Quality Jobs Program (HQJP) – tax credits. We are very appreciative for the full support of the City of Davenport and the State of Iowa. This is an extremely exciting time for Fair Oaks Foods in our growth as a company, and we are happy to partner with the City of Davenport and the State of Iowa on our new home.”
In exchange for the incentives, the development is expected to have an annual economic impact of $182 million – making it the largest single business attraction project in the region’s history. That figure illustrates how the benefits of major projects are multiplied throughout a region.
According to Jennifer Walker, chamber vice president, marketing & sales, among the factors that go into economic impact figures are: the company’s industry, number of jobs created, total payroll, land cost, building construction costs, and investment in machinery and equipment.
“The company will make the investment, construct the building, and employ their workers – this is their direct economic impact,” she said. “Then the company spends money with their suppliers and their suppliers add additional workers and capacity to their operations to meet demand. Finally, the employees at the company and their suppliers will spend money within the Quad Cities economy on houses, cars, groceries, entertainment, etc. The money turned over several times within the economy, which causes a multiplier effect.”
Also apparent in the Fair Oaks Foods project deal is the importance of nearby suppliers and support businesses.
“Davenport was a desirable location for Fair Oaks Foods in large part because of Iowa’s dominance in the pork production market,” said Sarah Ott, chief strategy officer for the City of Davenport. “It is anticipated that many local and regional businesses will benefit as partners in Fair Oaks Foods production.”
Added Ms. Ott: “The quality workforce, the area’s long-standing commitment to manufacturing and its central location makes Davenport a highly desirable location to do business.”
Mike Oberhaus, the Quad Cities Chamber’s interim CEO and chief strategy officer, said, other factors businesses consider in expanding or locating in the Quad Cities include: “availability of sites, access to sufficient utilities, proper zoning, skilled workforce availability and culture fit.”
Comments that the leaders with Fair Oaks Foods made in announcing their deal indicate the Davenport site checked all the important boxes.
“The opportunity that the city has extended to us is the right fit, at the right time, for Fair Oaks Foods,” the company’s CEO and President Michael Thompson said at the June 14 news conference in Davenport. “It will be a great opportunity for our people to live and thrive in this region. We look forward to providing new jobs and opportunities for the community.”
Mr. Freda, the COO said then, “Fair Oaks Foods prides itself on the relationships that it holds. We continue to build our legacy through strategic partnerships that share our values of trust and integrity. This was one of the main pillars when we chose The Austin Company to guide us in our search for a location to support our growth.” (The Austin Co. was retained as the project’s design-builder.)
The search included 177 sites in the Midwest “and ended in Davenport,” Mr. Freda added. “This is a community that mirrors our values and work ethic, and we are excited to make Davenport home to our future growth.”
Success breeds success
Does one successful project lead to others? The results suggest yes. Consider that the Fair Oaks Foods deal came nearly 11 months after Amazon announced its own plans to build a facility in the EICC. In July 2021, Amazon unveiled plans to build its second Iowa robotics fulfillment center, which at the time was described by community leaders as the largest economic development project in the region’s history. Site work and construction have been under way since last summer and completion had been set for this year. Amazon has since pushed that timeline forward to 2024. And that Amazon project also was not the first major win for the growing EIIC. Davenport “has been building upon success for well over a decade at the Eastern Iowa Industrial Center,” Ms. Ott said. “Many local companies such as John Deere, PCT Ebeam & Integration, MMS Thermal and Ercolina first called the Eastern Iowa Industrial Center home.” “The EIIC achieved site certification first in 2015. This helped to secure Kraft Heinz’s new food production facility,” Ms. Ott said. “Site certification along with the city’s shortline railroad and transload facility (operated by Davenport Industrial Railroad) cinched the deal with Sterilite.” In addition, she said, the center’s certified site status enabled “Kraft Heinz to select their site with the confidence knowing they could hit the ground running with construction. Site certification provides assurance that a site is developable and relatively risk-free.” The EIIC’s success also is a product of the visionaries who made up the partnership that led to the industrial center’s creation, said Roy Wennlund, executive director of GDRC, a public-private partnership created by a group of leaders from MidAmerican Energy, Scott County, the City of Davenport and the chamber. Their efforts and those of others have combined to make a $1.2 billion impact in the Quad Cities region over the past three years.The making of a deal
Unlike the Amazon project, which happened in a span of a few months, efforts to land the Fair Oaks plant began in June 2021 when the Iowa Economic Development Authority (IEDA) issued a request for proposals. The Austin Co., a site selector familiar with the region, connected with the chamber to inquire about potential sites, Mr. Oberhaus said. To help make the deal happen, the chamber organized a site visit in July 2021 with company representatives and the consultant, convening representatives from the city, Eastern Iowa Community Colleges and utility providers. The chamber coordinated a second site visit in August 2021. The chamber collaborated and aligned with city and community partners to submit a proposal for the Fair Oaks plant, he said.What’s next in QCs?
Are there other projects in play in the region? Most investigative processes for potential projects are conducted confidentially, Mr. Oberhaus warned. “Therefore, it is not possible to identify potential announcements in the future.” He did say, however, “At any time the chamber is responding to a multitude of requests for proposals and information from site selectors, developers, states of Iowa and Illinois, and local partners.” “These are very competitive and long processes. The chamber team, with its municipal partners, identify sites meeting the project’s needs, respond to proposals, answer questions received, provide information on resources available for projects, and coordinate with local education institutions, utility companies and other entities that can provide for the requested needs of the potential attraction/expansion project,” Mr. Oberhaus added. In addition to the EIIC, the Quad Cities region boasts three other certified sites available for those potential developers, Ms. Walker said. “Eastern Iowa Industrial Center just completed their recertification with IEDA. The Anderson 400 in Princeton (Iowa) is a Certified Green Business Park. And the Lincolnway Industrial Rail & Air Park in Clinton is our third certified site in the region, and they will complete their recertification this summer,” she said.QC Regional economic development – At A Glance
Over the last three years, Quad Cities Chamber-involved projects resulted in:- 25 successful business attraction or business expansion/retention projects.
- $1.2 billion economic impact.
- 5,500 new and retained jobs.
