The economic boom that is happening in Huntsville right now is truly deafening. And that’s not just because of recognizable companies that are increasingly finding a home here (think Mazda Toyota, Jeff Bezos’ Blue Origin, the FBI, and the Space Command). Building permits are way up, with $220 million of commercial and residential construction permits issued in September 2020—an all-time record month logged in the middle of the COVID-19 pandemic.
And speaking of that, Moody’s Investors Service predicts the city’s economy will be fully recovered from the hit suffered by the pandemic in two years, with employment back to normal a year later. That’s a year ahead of what is expected for America as a whole, and it’s nothing new for Huntsville: for the 12th time in 12 years, Moody’s and Standard & Poor’s awarded Huntsville triple-A credit ratings. SmartBank has been partnering many small businesses looking for treasury management services, and so we have a good understanding for how to balance cash flow in a booming economy.
Entrepreneurs are flocking to Huntsville to collaborate within the industry ecosystems being created by larger employers. Here is why:
The heart of Southeast’s automotive industry is in North Alabama. Open since 2003, Toyota Motor Manufacturing Alabama employs 1,100 people; Polaris in 2016 opened a 920,000 square foot manufacturing facility. And that is just the start. Huntsville’s reputation as an auto manufacturing nexus will only surge with the opening of the Mazda Toyota Manufacturing assembly facility in Huntsville later this year.
The $2.3 billion joint-venture between Mazda and Toyota started hiring in January 2020 and had reached 600 employees by summer. The second wave of hiring that started in November will eventually bring the tally to 4,000 new jobs, and strong ones at that. Full-time positions on the production team, for instance, pay $17 to $23 an hour plus shift premium, benefits, and a 401(k) with a 6% match.
And where the assembly plants go, so too do the suppliers, and Huntsville is no exception. In 2019 Japan-based DaikyoNishikawa US became the first on-site partner announced for the Mazda Toyota Manufacturing plant. Its $110 million auto parts manufacturing facility will employ about 380 workers who will produce plastic automotive parts. Within months four more suppliers had made similar announcements, bringing just their planned capital investment in the Huntsville area to $440 million.
From rockets to weapon systems and biotech to automobiles, Huntsville is known for its technological prowess. But that is also just one hearty slice of the pie. The Mazda Toyota Manufacturing deal has other ancillary benefits for Huntsville, including better roads. As part of the city’s commitment to Mazda Toyota, nearly $100 million has been spent to reconstruct Old Highway 20 and to build a new 10-mile section of Greenbrier Parkway, which are designed to both increase plant workers’ ability to travel safely to and from work but also support future growth of a western business corridor growth.
But why limit ourselves to roads? The “Rocket City” scored a major win in January when Redstone Arsenal, the US Army installation in Huntsville, was named the chosen location for the US Space Command’s headquarters. Space Command is currently based in Colorado Springs, and that state was expected to be picked for this honor. In announcing its decision, the Air Force touted the fact that Huntsville had more standout factors than any other location, including its qualified workforce—the staff will eventually number 1,400—excellent schools, and infrastructure capacity.
And our space ties are strong. Blue Origin’s year-old rocket engine plant here stretches over the equivalent of three city blocks and is the home of the company’s efforts to develop the next generation of reusable rocket engines—and end America’s reliance on Russian-made engines.
When it comes to high-tech aspirations, there’s also Facebook, which in February announced that it was expanding its new Huntsville data center in a big way. How big? It is adding two buildings to its original two; the total investment in the facility could end up topping $1 billion.
But back to Redstone Arsenal, which, along with NASA’s Marshall Space Flight Center, employs 44,000 people. It’s growing in more ways than one. The FBI will by the end of the year relocate nearly a dozen FBI divisions and offices—and the 1,500 employees and contractors who staff them—to Redstone Arsenal, where the Terrorist Explosive Device Analytical Center is being constructed and an innovation center for cyber-focused training is planned. It could end up being one of the largest concentrations of FBI employees outside of Washington, DC.
And just next door is Cummings Research Park, which claims the title of the 2nd largest research park in the US. It is home to 320 companies and 26,500 people involved in technology research and development.
This laundry list of movers and shakers share a commitment that Huntsville has the talent, the growth potential, and the infrastructure needed for impressive growth. Some of the biggest companies and government entities in the country are investing in Huntsville, and by extension, that makes now the time for new entrepreneurs to make an investment in Huntsville.
We work day-in and day-out with companies who are doing that very thing. From a banking perspective, here are four questions we recommend you ask yourself as a current or future small business owner in the Huntsville market:
· Do I have the support of my current bank?
· Do I have the necessary capital to move forward with my future growth plans?
· Am I using my excess cash in an appropriate manner to better grow my business?
· Will I be able to continue to find the right personnel to continue my growth?
It can be scary to realize your answer to any of those questions is “no.” But at SmartBank, our focus is on working closely with small business to help position them to best share in and contribute to Huntsville’s success.