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VOL. 126 | NO. 83 | Thursday, April 28, 2011

Perl: Collaboration is Key for Memphis to Remain Competitive

By Sarah Baker

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The realities of business are undoubtedly changing.

John Kasarda, the University of North Carolina professor who coined the term “aerotropolis,” recently said that individual companies no longer compete – supply chains do. He also said the three rules of real estate have changed from location, location, location to accessibility, accessibility, accessibility. And there’s a new metric, he said. It’s no longer space, it’s time and cost.

Arnold Perl, chairman of the Memphis-Shelby County Airport Authority and the Greater Memphis Chamber’s aerotropolis initiative, told the Society of Industrial and Office Realtors Tuesday at the Crescent Club that Kasarda was describing the Memphis DNA.

“That’s the real Memphis edge at this point,” Perl said. “It’s supply-chain based, it’s time and cost and the FedEx advantage that is offered to companies that you bring here to Memphis.”

Inscribed into the globe on the floor of the rotunda at Memphis International Airport’s B concourse is a phrase that captures the Memphis mission: “To change the region and to connect this world.”

Memphis is especially ideal for companies that rely on fast-cycle logistics to support their business model, including high-tech, electronics, bioscience, medical and health service. That’s why one in three Memphis jobs can be attributable to the airport, with many of them thanks to FedEx.

“We have the infrastructure that has created for us an economic juggernaut,” Perl said. “We have more air service per capita than any other city in the United States.”

Memphis International generates $28.6 billion per year, according to a University of Memphis economic impact study. Hartsfield-Jackson Atlanta International Airport is the only airport in the U.S. to exceed that.

Perl said the most frequently asked question at the airport is why it doesn’t have Southwest Airlines. While it appears that might soon change due to Southwest’s recent merger with AirTran Airways, Perl explained that Southwest tends to follow cities that fit into two criteria – high fares and underserved air service.

“This is a community that has over-served air service,” Perl said. “We have three flights a day to Los Angeles with less than 100 people that originate their travels in Memphis, and they’re flying these Airbus 319s three times a day to L.A. It’s all because of connections. We are a transfer hub second to none; it’s a hassle-free airport.”

But it’s not just the passenger service or even the cargo component of FedEx that has made Memphis into “America’s Aerotropolis,” as the Greater Memphis Chamber now calls the city. It’s the combination of the air, rail, road and river along with the leadership of the Memphis community.

But to move forward, the city must foster a culture of collaboration. A recently published USA Today article that quoted Perl stated that, “The push is for aviation authorities to partner with private companies to cohesively and systematically develop bountiful land near the airport to attract office space, warehouses, logistic centers, retail stores, recreational facilities and apartments.”

It’s that group effort, Perl said, that will make Memphis the kind of city it aspires to be. And in order to be well-poised for economic growth, he stressed the significance of the convention business.

“The budgetary woes of the city may be even greater than what we’ve read about,” Perl said. “Anybody who knows what’s happening in Indianapolis or Nashville, once those convention facilities are open and they’re in the same triangle of the country that we are, Memphis is going to be out of the convention business. People say that we don’t have the money to build it. Well, then we’re going to be out of the business.”

Evidence of that was at the recent Airport Cities World Conference & Exhibition, at which Memphis hosted representatives from 40 different countries.

“They think Memphis is the place to be when it comes to working and living in the U.S.,” Perl said. “Our problem has been the people who live here think far less of our community than those who live far away.”

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RECORD TOTALS DAY WEEK YEAR
PROPERTY SALES 63 269 16,682
MORTGAGES 85 313 21,745
FORECLOSURE NOTICES 0 56 4,322
BUILDING PERMITS 0 209 39,587
BANKRUPTCIES 65 287 15,829
BUSINESS LICENSES 16 67 5,558
UTILITY CONNECTIONS 126 413 23,986
MARRIAGE LICENSES 22 94 5,129

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