Location Intelligence Newsletter
Site Selection Group, LLC
Accelerating your business with location analytics, economic incentive management, and corporate real estate solutions.
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5 Site Selection Themes for Mexican Manufacturers Considering the U.S.
by Josh Bays
The United States is receiving increased interest from manufacturers with their proverbial eggs in the Mexico basket. Site Selection Group, a full-service location advisory, economic incentive, and real estate services firm is experiencing tremendous activity from industrial companies wanting to evaluate the United States as an alternative to the production capacity they currently have south of the border.?
While these companies have faced pressures such as being closer to the U.S. consumer market, as well as achieving the moniker of Made in America, it is clear the current political rhetoric around implementing tariffs is driving the exploration of an American production strategy.?
For companies in industries like automotive, medical devices, consumer products, construction products, and others, there are several nuances associated with the current site selection landscape in the United States. Below are five themes that are different from operating in Mexico. ?
1. The U.S. regulatory climate?
While Mexico certainly has regulatory practices in place around environmental and construction standards, it is fair to say manufacturers can expect those guidelines to be more stringent in the United States. Local zoning codes dictate permitted uses for specific locations, and interpretations for many common manufacturing processes can be nuanced. Rezoning a property is not guaranteed and can be a lengthy endeavor.?
States with Meaningful Job Creation Incentives
At Site Selection Group, we are often asked which states offer the most meaningful economic incentives. The answer to this question is heavily based on the facts and circumstances of each project, including the industry sector, level of incremental headcount and capital investment, estimated wages, and competitiveness of the project. While determining whether incentives are meaningful is subjective, most companies are keenly interested in economic incentives that are truly realizable. The focus of this blog is on states offering incentives that are generally tied to new job creation.
We often point out that many states with significant economic incentives are utilizing such tools to compensate for otherwise punitive tax policies. Thus, for perspective, we included the overall ranking from the Tax Foundation’s 2025 State Tax Competitiveness Index for each state highlighted below.
1) North Carolina (12*)
The Job Development Investment Grant is a performance-based, discretionary incentive that utilizes the withholding taxes of new employees to provide annual cash grants for up to 12 years. The percentage of withholdings and the term awarded are dependent upon the industry sector, the location of the project (i.e., the county tier designation), the number of jobs, the average wage, and the level of capital investment.
Rail-Served Sites: A Key Factor in U.S. Industrial Location Strategy
by Dewey Evans
The following article explores site selection strategy in the United States, examining the implications of rail service as a top consideration for companies seeking to invest in the U.S. Site Selection Group (SSG), a full-service location advisory, economic incentives, and real estate services firm, regularly facilitates site selection projects for rail-served industrial clients.
U.S. rail system
The U.S. rail system is dominated by freight transportation, a key difference in comparison with international rail networks like those in Europe that have historically favored passenger transportation. According to the Federal Railroad Administration, “Running on almost 140,000 route miles, the U.S. freight rail network is widely considered the largest, safest, and most cost-efficient freight system in the world.”?
The freight rail industry is operated by six Class I railroads (railroads with operating revenue greater than $1.05 billion, as defined by the Surface Transportation Board), and 22 regional and 584 local/short line railroads. The six Class I rail providers are BNSF, Canadian National, Canadian Pacific Kansas City, CSX, Norfolk Southern, and Union Pacific. While Class I providers typically focus on transporting freight long distances across networks spanning multiple states, regional and local/short line providers operate over shorter distances and connect to (or interchange with) the Class I rail providers.
Impact of U.S. Travel Advisories on Nearshore Site Selection
by King White
As the nearshore region continues to attract U.S. companies for operations like call centers, software engineering, and manufacturing, U.S. travel advisories play a crucial role in shaping site selection decisions. Companies are increasingly cautious about setting up operations in countries where travel risks are deemed high, often prohibiting employee travel to these regions. Such travel restrictions can influence the feasibility of nearshore projects.
Understanding U.S. travel advisories
The U.S. Department of State issues travel advisories to help travelers assess the safety of international travel destinations. These ratings range from Level 1 (Exercise Normal Precautions) to Level 4 (Do Not Travel), with the advisories reflecting factors that include crime, terrorism, civil unrest, health, and other potential risks.
Influence on site selection
For companies considering nearshore locations, these ratings are a significant factor. For instance, while Mexico is a popular nearshore destination, its varied ratings by city can complicate site selection decisions:
Site Selection Group Releases Retail Site Selection Whitepaper
by King White
We are thrilled to announce the release of Site Selection Group’s latest whitepaper on Retail Site Selection. Key Steps to Optimizing Retail Site Selection Decisions is a comprehensive guide designed to empower retailers with the insights and methodologies needed to optimize their store locations, driving growth and profitability through strategic placement.
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Explore Key Insights
The Current Real Estate Market for Distribution Centers
by Jake Wilson
The United States distribution real estate market is nearing the end of an era categorized by record speculative development. Availability of logistics buildings larger than 100,000 SF has grown by 20% over the past four years, but the delivery of new speculative construction is anticipated to fall below pre-pandemic annual averages by mid-year. This signifies the end of the era of rapid construction that peaked in 2022 when roughly 600 million square feet of new buildings broke ground.?
Continued increase in vacancy
Despite another year of positive net absorption, vacancy rates across distribution properties have risen to 7.8% year-to-date; up from 6.8% this time last year. The increased vacancy isn’t due to a lack of activity but more a result of the boom in speculative development that is predicted to slow down in 2025 and 2026. Net new deliveries peaked at 151 million SF in Q3 2023 and have steadily declined since. The slowdown and general pause in new construction should allow vacancy rates to slowly drop over the next year or two so long as net absorption remains positive. ?
The Hiring Question: Beyond Wages & Salaries
by Ceci Grover
Whether a company is looking to hire 100 or 1,000 people, workforce is at the forefront of site selection decisions. One of the most common questions we hear clients ask is when considering a community “How are we going to hire workers here?” Perhaps the answer to that question also requires the client to consider their value proposition to employees. In other words, “Why should people want to work for us?”
There is no doubt hiring is much easier when you are paying competitive wages, but more and more, employees are seeking intangible benefits. In fact, oftentimes the “employer of choice” in a community isn’t necessarily the one paying the highest wages. Site Selection Group (SSG) has put together a list of benefits current and prospective employers can offer to help ensure employers are successful with their hiring efforts.
Childcare options
Access to affordable and quality childcare is a chief concern among employees, especially female employees. According to the U.S. Department of Labor, childcare costs can be more than rent in some places. To help ease the financial burden on employees, SSG has seen employers provide the following:
by King White
In a bold move that aligns with actions taken by corporate giants such as JPMorgan and Amazon, President Trump has issued an executive order requiring federal employees to return to the office. This mandate could serve as a pivotal turning point for the future of work, potentially ending the remote work era that has been a hallmark of the pandemic response.
The implications of the federal mandate
President Trump’s directive mandates a return to the office for federal employees, echoing a growing sentiment among business leaders that in-office work enhances productivity and collaboration. This federal push is expected to influence private sector policies, potentially leading to a significant decrease in remote work opportunities.
The Retail Reshuffle: 2024 Store Closures and Strategic Site Selection
by King White
The retail landscape in 2024 has witnessed a significant transformation, marked by a series of high-profile store closures across the United States. Brands that once dominated shopping malls and commercial districts are reevaluating their strategies in response to evolving consumer behaviors, economic pressures, and the rise of e-commerce. This shift underscores the critical importance of meticulous site selection and advanced analytics in retail decision-making.
Major store closures in 2024
Several well-known retailers announced closures, signaling a shift in the sector's dynamics:
Ghost Job Postings Impact on Site Selection Data Integrity
by King White
Accurate labor market data is crucial in the complex landscape of site selection for new facilities and operations. However, the emerging prevalence of “ghost jobs” in job listings has posed a new challenge for businesses. As many as one in five online job postings may not result in actual hires, influencing perceptions of labor availability and potentially leading to misguided site selection decisions.
The reality of ghost jobs in labor market analysis
Ghost jobs, as uncovered by platforms like Greenhouse and reported by major outlets such as The Wall Street Journal, represent job listings that remain unfilled or are fictitious. These listings can significantly skew the data that companies rely on when assessing the labor market for potential site locations, particularly in labor-intensive sectors like manufacturing, call centers, and software engineering. This misleading data can result in overestimations of available talent, impacting crucial investment decisions.
Site Selection Group is a leading provider of global location advisory, economic incentives, and corporate real estate services. Our purpose is to deliver conflict-free solutions that enable our clients to make a positive impact in their communities. Our mission is to connect companies to the optimal locations through our integrated service offerings which include: Location Advisory Consulting, Economic Incentive Services, Corporate Real Estate Services, and Economic Development Consulting.
If you have any questions, get in touch with us, or leave a comment below.