It's not just L.A. that is also victim to otherworldly residential real estate costs. It's a statewide challenge, and it's driving many to look at the Central Valley for the answer.
A recent online poll by Kern EDC, the economic development agency for Bakersfield and Kern County, asked, "Do you think that the business environment in California has improved over the past year?" A full 75 percent of the respondents at press time had answered "some," "a little" or "a lot," a striking turnaround from the past couple of years.
When visitors to that same Web site were asked what the chief assets of Kern County were, half of them said, "Inexpensive cost of living." Many business owners would match that answer with their low cost of doing business. Manufacturing and aerospace are seen as opportunities for the area, but the predominant driver is the logistics business.
Logistics certainly drove
Performance Food Group to the area. In this instance, there will be some U.S. goods leaving California for Asia.
In October 2004, the Richmond, Va.-based food service distributor announced its 134,000-sq.-ft. (12,449-sq.-m.), 110-employee DC west of Minter Field Airport in Shafter, due northwest of Bakersfield. Plans call for an eventual footprint three times that big, and as many as 400 employees. The new facility, which will sit on a 35-acre (14 hectare) site, marks an expansion from space the company previously leased from U.S. Cold Storage.
The project is the first development in the west side industrial area of the Minter Field Industrial Park. Working together with the City of Shafter, the airport is building a new road and installing all underground utilities to serve PFG and opening an additional 100 acres (41 hectares) of land for industrial development at the airport. From the new site, PFG will serve customers in nine Western states and 14 Pacific Rim countries.
Due south, Tejon Ranch Co.'s Barry Hibbard says around 5 percent of his company's 270,000 acres (109,269 hectares) will be developed over the next five to 10 years. He says the trend is toward fewer warehouses serving a larger regional area.
"I think you're going to see larger buildings gravitating toward where there is entitled dirt, and doing more and more inside them, which means you need better labor," he says. "It's not your father's warehouse anymore there's repackaging, floor-ready goods. What used to be in the backroom of retail or overseas at the manufacturing plant is now taking place at the warehouse. Consumer preferences change so quickly, you have to be closer to that final configuration, and the Central Valley starts to offer a solution to some of those companies."
Making it more lucrative is the idea of one truck turn, which is an even bigger factor given new hours-of-service rules. So companies are considering how to not only keep drivers, but find places where those drivers can affordably keep their homes.
Even in this region that seems to have a leg up on L.A., the same disconnect between business and elected officials sometimes rears up. In May, in a meeting with Gov. Schwarzenegger's lead "jobs czar" David Crane, noted Kern Co. business leader Ray Dezember said the problem lies less with geography and more with the politicians themselves.
According to notes from the Kern Co. EDC, Dezember said that "because California has a full-time legislature, the elected officials are not among the community and not able to relate to the community, which makes them out-of-touch with the people they were elected to serve." This year's session, for instance, is slated to run from Dec. 6, 2004 to Oct. 21, 2005.
His solution? Go back to a part-time legislature, thus enabling the elected to spend at least half of their time working and living among the electors.
For now though, cutting half the time off getting through the ports may do the trick.