Aerotropolis model could attract jobs, businesses to Dayton

Where is aerotropolis?

You can find a potential developing or an operating aerotropolis in:

North America

Baltimore-Washington International Airport

Charlotte Douglas International Airport

Chicago O’Hare International Airport

Cleveland Hopkins International Airport

Dallas-Ft. Worth International Airport

Denver International Airport

Detroit Metropolitan Wayne County Airport

Edmonton International Airport

Fort Worth Alliance Airport

Hartsfield-Jackson Atlanta International Airport

Indianapolis International Airport

Europe

Amsterdam Schiphol

Athens International Airport

Eleftherios Venizelos

Barcelona El Prat Airport

Bremen Airport

Dublin Airport

Frankfurt Airport

Frankfurt-Hahn Airport

Helsinki-Vantaa Airport

London Heathrow Airport

Asia-Pacific

Bangkok Suvarnabhumi Airport

Beijing Capital International Airport

Bengaluru International Airport

Brisbane Airport

Clark International Airport

Cochin International Airport

Delhi Indira Gandhi International Airport Guangzhou

Baiyun International Airport

Hong Kong International Airport

Hyderabad Rajiv Gandhi International Airport

Incheon International Airport

Kuala Lumpur International Airport

Source: “Airport Cities,” Airport World, 2013.

Aerotropolis: The Detroit experience

In Detroit, VantagePort - Detroit Region Aerotropolis, was formed as a regional public/private parnership focused on expanding investment in and around Wayne County’s Detroit Metro and the Willow Run Airport system. It seeks “new commerce that must have access to secure, timely and reliable supply chain and logistics infrastructure” and offers connections to investment incentives, streamlined location help, and connections to economic development agencies.

It targets the following industries:

Aviation/aerospace

Defense research and contracting

Alternative energy research and manufacturing

Life sciences

Healthcare

Source: VantagePort

Hundreds of new jobs have located near the Dayton International Airport and the Interstate-75 and I-70 interchange in recent years, causing leaders to start debate on an airport-driven economic development model tried in other cities such as Atlanta and Indianapolis.

Dubbed aerotropolis, the concept calls for making land around airports — especially those with major transportation arteries such as nearby highway interchanges and rail — the key focus of efforts to attract industry and jobs.

In the model, townships, cities and counties with common borders create a development corporation and agree to share resources in hopes of speeding government approvals, lining up incentives and establishing workforce pipelines.

“It’s everybody getting on the same page and emphasizing the importance of the airport for economic development,” said Terry Slaybaugh, Dayton’s Director of Aviation. “No one group can accomplish it.”

Aerotropolis as a unifying tactic for job creation has gotten the attention of Dayton-area officials.

“We have talked about aerotropolis and convening partners,” Dayton Mayor Nan Whaley said. “How do we connect the airport to the larger region? How do we grow it and leverage it? We need to have a discussion on it. There are great possibilities here.”

Kevin Carver, executive director of the Clinton County Port Authority which is working to redevelop the Wilmington Air Park, said aerotropolis is worth a closer look. A model here could include both airports in Dayton and Wilmington which are about 50 miles apart.

“It deserves more analysis by all of us to see what possibilities exist for the Dayton region,” he said. “We are blessed with a ton of assets that fit into that concept.”

The concept has its detractors. It has not had notable success everywhere and aside from some serious discussion in Cleveland, it’s not taken root in Ohio.

But success in the concept can be found a few hours north on I-75. Detroit embarked on the aerotropolis model in 2009 with its Detroit Region Aerotropolis Development Corporation that includes Detroit Metro Airport and Willow Run Airport. Nearly 1,000 new jobs and $660 million in investment has been added to the Detroit region in 2013 — more than $1 billion since the model began there, said CEO Joseph R. Nardone.

In potentially its biggest win, a 5 million-square-foot factory at Willow Run is being demolished in a redevelopment proposal to create a center for advanced vehicle research.

Will aerotropolis work in Dayton?

Key to making aerotropolis work — advocates and critics say — is landing companies or expanding existing ones that boost demand for speedy passenger and air cargo transportation connections, in particular manufacturers of costly but lighter-weight goods.

The short list of possibilities include pharmaceuticals, microelectronics, aerospace components — think jet engines — that also require higher-skilled, higher-paid workers. The emerging 3D, or additive, manufacturing industry offers potential as a new way to manufacture aerospace components using light-weight composites.

That tact long has been pursued by Dayton economic development groups. Here the manufacturing base includes 2,570 companies that pull in $36.6 billion in annual sales.

Aerospace and auto-related industry are heavily represented in the Dayton region. Kettering’s National Composite Center is pursuing a manufacturing and training hub to enhance the regional supply chain for Airbus. The center recently landed a $500,000 state grant for the hub and is pursing more funding.

Large-scale physical assets are plentiful. Dayton International Airport has 1,000 acres outside the fence under city control that could be developed. A Vectren high-pressure natural gas pipeline is being relocated that would make connections less costly for new industry to tap affordable fuel. The Montgomery County Transportation Improvement District is pursuing a rail line extension from the CSX line east of I-75 to the airport.

On the airport grounds, a 1 million-square-foot building is three-quarters vacant since Emery Air Freight left in 2005. It offers office and warehouse space, truck docks and an aircraft ramp. Include the Wilmington Air Park in a regional aerotropolis model and the available move-in space jumps to about 3 million square feet with an additional 400 acres with utility connections.

Encouraging signs in the region

The area around the I-70/I-75 interchange has already posted some notable successes in recent years. Since 2008, Abbott Laboratories Inc., Caterpillar Logistics, Collective Brands and White Castle have landed within range in northern Montgomery or in southern Miami County.

The city of Union spent $2 million to extend water and sewer to its Global Logistics Airpark, which has hundreds of acres. Upgrades to Dog Leg Road, a portion of Jackson Road and connecting both to Old Springfield Road, have cost $13.2 million. Plans call for additional upgrades.

In recent weeks, three announcements struck similar tones — logistics, transportation, the industrial base and the region’s market reach that includes a 90-minute flight to more than 137 million people.

Locally, the I-70/I-75 Development Association has a similar ring to aerotropolis since it is based on the logistics of the interchange. But it's not a formal economic development organization and is primarily a networking group that includes 100 organizations with 125 members — economic development organizations, local and state governments, chambers of commerce, private industry.

Efforts in Detroit and Cleveland

Joseph R. Nardone is the CEO for the Detroit Region Aerotropolis Development Corporation, which also goes by the name VantagePort. The public/private partnership includes communities surrounding Detroit Metro Airport and Willow Run Airport, famous as the location of a World War II bomber plant.

The wins last year were significant including Detroit Thermal Systems’ investment of $41.8 million to develop and manufacture climate control systems and related components in Romulus, adding 300 jobs; GM Powertrain Operations investing $500 million for a new 10 speed transmission and V6 engine program that added or retained 800 jobs and an expansion by manufacturer Brose North America that created 450 jobs.

The biggest hurdle has been forging common purpose across political boundaries, Nardone said, but Southeastern Michigan has made it work.

“We are evolving in a positive way. It’s a great synergy,” he said. It took a decade of study and agreements with seven communities, two counties and business leaders that include DTE Energy. “Instead of having communities fighting over street boundaries, the idea is that if it’s across the street, it is still good. We’ve gotten away away from the idea of governments competing against each other.”

It doesn’t hurt that 50 percent of U.S. trade with Canada, the nation’s largest trading partner, moves through Detroit, Nardone said.

In Ohio, discussion about the aerotropolis concept has advanced furthest in Cleveland.

In 2010, Cleveland State University's College of Urban Affairs completed a feasibility study for Hopkins International Airport. Analyzing six U.S. airports that had aerotropolis potential, the study found a common theme — the ability of the airports to plan, market, and dialogue with surrounding communities. That includes coordinating land use and development, communications and technology, traffic and transportation networks and targeting specific industries.

Incentives in play included tax credit and tax abatement programs, tax increment financing and enterprise zones — all statewide economic development programs.

Kevin O’Brien, Professor of Public Finance at Cleveland State, said aerotropolis discussions are ongoing among politicians and business representatives.

“There is a logic to it that makes it a real economic development strategy with the airport as a nucleus,” he said.

While Cleveland and Dayton are not first-tier cities on a national scale, neither is Memphis. But Memphis became an aerotropolis built around Federal Express headquarters, declaring it is adopting the aerotropolis model.

“Their aerotropolis is their economic development strategy. I give aerotropolis a lot of credence. It’s a new and future focus strategy,” O’Brien said. “In the absence of this, nobody is building on their airport.”

Both sides of the debate over aerotropolis model

Professor John Kasarda, Director of the Center for Air Commerce at the University of North Carolina, is credited with developing the term aerotropolis, or airport city.

Most have sprouted in emerging economies in Asia and the Middle East, but Kasarda sees Dayton’s location within close reach of so many consumers as a key selling point as well as Ohio’s history of higher worker productivity and advanced manufacturing. Competing for industries with low wages that require low skills would be a losing game in the aerotropolis model, he added. “By putting an infrastructure in place to make Dayton the fastest and most agile place to do business, the investment will come,” he said.

Blindly rolling out the aerotropolis welcome mat will fall short, according to Michael Webber, the Austin-based president of consulting firm Webber Air Cargo, Inc., who is the author of a scathing article about thinking the concept is an easy solution.

“What I hate about the aerotropolis shtick is so often it’s being presented as a panacea for places like the Rust Belt which has been cored out by macroeconomic factors that won’t be fixed by better branding,” he said. “What I tell clients and communities is that you need to work on the demand side. Attract companies that use air cargo services. It will be a return to manufacturing, but if it uses the airport, it must be high-value, low weight goods. “

Jeff Hoagland, President and CEO of the Dayton Development Coalition, which functions as a regional economic development clearinghouse, said that while he’s not an expert in the aerotropolis field, Dayton and surrounding communities have been planning and working together well. “As we continue to work together cooperatively on a regional basis, the opportunities are endless,” he added.

While he has not used the aerotropolis term much either, Union City Manager John Applegate has been pursuing the model for some time with the city’s industrial park.

“That’s what an airport is, an economic engine,” he said while standing near the new P&G distribution building. “With the I70/I-75 interchange, people realize this is a good hub.”

Gesturing to the P&G building, he adds: “This is just what people need — jobs.”