If South Carolina is considered business friendly, then recent years mark the Upstate as downright amorous, but wobbly economic conditions nationwide likely presage a slowdown as 2023 advances, according to local economic development experts.
The overall outlook for industrial growth in the Upstate remains strong, according to Mark Farris, CEO of the Greenville Area Development Corp.
National and global companies continue to express interest in the region, Farris says, but inflationary pressures and uncertainty within the financial sector in the opening months of 2023 may slow the pace of companies coming to the Palmetto State through the remainder of the year.
Part of what may be a slowdown this year is the unprecedented success for manufacturing growth in 2022, according to Katherine O’Neill, chief economic development officer for OneSpartanburg.
Spartanburg County alone accounted for $3.2 billion of the state’s record $10.3 billion in new investments in 2022, and a significant part of that total came in October with BMW Manufacturing’s announcement of a $1.7 billion investment in new electric vehicle production capacity.
Another factor likely to contribute to a slowdown in new projects is the amount of speculative warehouse space that is coming online this year, according to John Montgomery, managing director of industrial services for Colliers.
He says there is about 14 million square feet of speculative warehouse/logistics space in the pipeline, of which about 11 million square feet has not been leased.
“Now the supply has caught up with the demand,” Montgomery says. “Now we’ll have buildings completed (and) sitting empty waiting for tenants to come and lease.”
He says a similar set of circumstances unfolded in 2019 when the supply of industrial properties outpaced demand, and it took about a year for the two to balance — just in time for a pandemic-induced hiatus.
Like Farris and O’Neill, Montgomery is confident in the strength of the market and the likelihood that companies will still want to move to the region because none of the factors that make the area attractive have fundamentally changed.
“We feel very good and bullish about the long-term prospects of the market,” Montgomery says.
