Two years young
Five years ago, 15-year Greer Mayor Rick Danner isn’t afraid to say he didn’t know much about ports, let alone rail-serviced inland ports.
“The big joke…was where they were going to dig the canal,” said Danner, recalling the atmosphere nearly three years ago when the Inland Port project was announced. “In some sense, that did make fun of the fact that people didn’t really know what that was, and I will admit that I might have been a part of that crowd.”
Today, the Inland Port has meant serious business not only for the Upstate, but also for the economic vitality of the surrounding region. Big names such as Dollar Tree and RiteAid have announced multimillion-dollar capital investment facilities that are expected to lean heavily on the Inland Port, supporting job growth and bolstering local industry.
The $104-million Dollar Tree distribution center, for example, is expected to boost container volume by 6,000 containers a year from the Upstate, while BMW’s $1 billion production expansion project in Spartanburg is also expected to increase auto and containerized volumes.
And judging by the international interest in Greer related to the ports, it doesn’t seem to be slowing down anytime soon, according to Danner.
“It’s interesting, because I think in specific sectors of the international community, the visibility of Greer has probably grown more than it has in the state,” he said, noting he couldn’t begin to count the number of international business and trade delegations that have demonstrated interest in Greer because of its port access. “There’s a growing confidence in the Greer community and the Greer area as a strong area to do business.”
S.C. Ports Authority President and CEO Jim Newsome spearheaded the Inland Port project nearly four years ago alongside leaders with rail service Norfolk Southern and the city of Greer. “I would not be surprised if we had the ability to double our capacity at that facility,” he said.
Announced in 2012 and completed in late 2013, the Inland Port in Greer essentially extends the Port of Charleston’s reach by 212 miles inland with direct rail service by Norfolk Southern. Shippers can minimize the congestion and high costs associated with trucking, while businesses – particularly distributors and manufacturers – can take advantage of cheaper real estate for facilities and operations, said Newsome.
“Inland ports represent a new trend in terms of distribution,” he said. “They’re closer to the interior where real estate is cheaper, and closer to where goods are demanded. … Retail distribution is not able to bear a very high cost of land, so we are really fortunate to have the area along the 85 corridor as an outlet.”
Build it and they will come
The SCPA owned the100-acre site in Greer for more than 30 years, but it remained largely vacant until Norfolk Southern approached them for a business plan in January 2012, said Newsome.
“It happened very fast. Conception to inception in under two years’ time is phenomenally fast,” according to Newsome, who said initial base cargo volume was pegged at 20,000 containers per year through the facility. “We knew there were other customers in the area that might find it attractive, so we went for it, basically.”
Newsome said the Inland Port is very close to reaching its goal of 100,000 rail lifts per year – a goal originally set for the first five years of operation, he said.
“During the first full year of operations, we handled 58,000 rail lifts,” he said. The inland port recorded 7,500 lifts in July, which annualizes to 90,000 for the next fiscal year, he said. If trends continue as expected, “By the second full year of operation we would have reached our target,” he said.
Part of the Inland Port’s success lies with the growth of the Upstate’s automotive industry, particularly with customers such as BMW and Michelin. The automotive and tire industries make up roughly half of the volume, while other customers such as Eastman Chemical and Adidas also represent significant business. While the automotive and related industries are likely to continue to grow, future growth could rest heavily on growing retail distribution near the Inland Port, said Newsome.
“We had a major breakthrough in the sense that we have now the first import retail distribution center of significant note, which is going to be opened in Cowpens by Dollar Tree,” he said. “That was really important because these retailers really follow each other. … We think other retailers will be inquisitive about what drew them here.”
Newsome said another major milestone was turning a bottom-line profit for the inland port, which happened less than three months ago.
One of the original selling points for the Inland Port included replacing truck traffic with rail and intermodal, theoretically reducing both congestion and wear on South Carolina’s crumbling infrastructure.
As clients and cargo volumes build, Newsome said the SCPA is already thinking about expanding capacity, both with the inland port and the organization as a whole. The inland port sits on 40 acres of the 100-acre site, and Newsome said paving the remaining 60 acres could be necessary as soon as fiscal 2017.
And soon, Greer might not be the only South Carolina city to benefit from an inland port, said Newsome.
“I will tell you that we are actively looking for other inland port locations,” said Newsome, who did not give a timeframe for the search. “We have in mind some ideas, other places where there are significant pockets that we think could be inland rail-served.”
Danner said the city has yet to return to pre-recession levels of growth, but current projections are at much more sustainable levels than before. While the inland port added relatively few direct jobs to Greer, Danner said the inland port has certainly given residential and commercial development a boost because of new business opportunities.
“Size-wise, we’re not typically in the running for large industrial facilities, but certainly having the port’s presence has moved us into a different realm on the industrial side,” said Danner, who said he couldn’t begin to count the number of international business and trade delegations he’s hosted in relation to the Inland Port. “In terms of the three-legged stool of residential, commercial and industrial, we now have all three legs.”