Waco, Texas, Year in Business: Store Openings, Closings, Job Losses, New Faces
Authors:
Mike Copeland
Source:
Waco Tribune-Herald (TX); 01/04/2004
Accession Number:
2W60226039647
Database:
Newspaper Source
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Waco, Texas, Year in Business: Store Openings, Closings, Job Losses, New Faces
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Jan. 4--It was not business as usual last year in Waco. In fact, one might describe it as a mad, mad 2003.
Veterans and community leaders got angry over a recommendation to close the Waco Veterans Affairs Hospital.
Some restaurant owners became moody over the new smoking ordinance and the money they had to shell out to create separate smoking areas. Some chose to ban smoking altogether.
Waco fliers complained about American Eagle charging lower fares in Killeen than in Waco. They cheered up when SkyWest began flying out of Waco, giving Eagle competition and Waco fliers price relief.
Kmart closed, to the chagrin of its loyal customers. Piccadilly likewise jumped the good ship Waco.
A $70 million shopping center began to take shape, and experts say it will reshape Waco's retail future.
Wal-Mart broke ground on a supercenter on Hewitt Drive and a merchandise return center in South Waco.
Jack Stewart left the chamber, and a former Navy pilot took over Waco's biggest industry, L-3 Communications.
A Holstein cow in Washington state was found to have mad cow disease, creating shockwaves felt around the world -- and in Waco.
The impact of most of these events is not yet fully known. But one can expect that most, if not all, of the following top 10 stories will have an effect on Waco for many months to come.
-- L-3 SOAP OPERA: When L-3 Communications sneezes, the Greater Waco Chamber of Commerce reaches for a tissue. L-3 is Waco's largest industrial employer, with more than 1,400 employees, so everything that goes on at its massive defense plant at the Texas State Technical College airport is magnified.
Last year was an up-and-down year for L-3. Jerry Iverson, site manager, expressed frustration over L-3's failure to land new contracts for the Waco plant shortly before he retired on Aug. 1. And an anonymous employee sent the Tribune-Herald several e-mails, predicting dire times and massive layoffs if the plant didn't get more work. In August and September, L-3 gave pink slips to nearly 70 people.
Then in November, L-3 concluded a $300 million, nine-year project in which the company converted E-6A planes to E-6B flying command posts for the U.S. Navy. The company hopes to win a $1 billion contract to upgrade avionics in the E-6Bs over 10 years.
Congress improved the mood at L-3 by approving an extra $30.3 million in aircraft modifications to be performed there. By November, L-3 actually was advertising to fill 55 positions, including engineering spots.
The year, it would seem, ended on a good note.
-- VETERANS AFFAIRS HOSPITAL: Waco's VA Hospital has been targeted for closure by a group looking into restructuring the nation's VA system. The VA has been a fixture in Waco since the 1930s. A neighborhood has grown up around it, and veterans live in group homes nearby.
Besides treating patients, the VA hospital serves as an economic stimulus. About 800 people work there, and their jobs could be jeopardized. Waco-based economist Ray Perryman said the VA pumps $203 million into the local economy each year. It contributes to 1,968 jobs in Central Texas -- including those at the hospital -- and to an annual payroll of $74 million and $29.8 million in retail sales.
Community and elected leaders have rallied in support of the VA, hoping to convince VA Secretary Anthony J. Principi that closing the Waco VA is not a good idea. Principi toured the hospital on Friday.
-- RETAIL FRENZY: Construction crews have worked days and some nights for months now on a new shopping center going up at State Highway 6 (West Loop 340) and Interstate 35. AIG Baker of Birmingham, Ala., is building Central Texas Marketplace at a cost of $70 million.
The first phase of the 1 million-square-foot marketplace opens this spring, the second phase this fall.
Observers believe this center will become a regional draw, pulling shoppers off Interstate 35. Kandace Menning, who manages Richland Mall, said she doesn't dread the shopping center's arrival, but she knows it will be another competitor with which she'll have to contend. The mall will also have to deal with the loss of one its larger tenants, Old Navy, which will move to the marketplace sometime this spring.
Belk, Ross, Marshalls, Gart Sports, Kohl's and Bed Bath & Beyond are among the stores moving in to the center.
Fast-food and sit-down restaurants also will dot the marketplace, and the developers hope for a book store and other "lifestyle" shops, including a spa, nail salon, big-and-tall shop and party store.
-- TARGET ON TARGET: Waco's new Target Greatland store held a preview party on the evening of March 4, and the place was swamped.
The cash registers were open for those who wanted to do more than munch on goodies and hear speeches. Manager Thomas Teodorczyk said the store, at Wooded Acres Drive and Bosque Boulevard, had 465 transactions during the first hour and 15 minutes.
The new Target was built where Lake Air Mall had been. During the Christmas holidays, sales were 30 to 40 percent higher than they were in 2002 at Waco's old Target store at Sanger Avenue and State Highway 6, which has closed.
-- FLYING TO HOUSTON: SkyWest Airlines entered the Waco market in 2003, flying daily between Waco Regional Airport and George Bush Intercontinental Airport in Houston. It links up Waco passengers with Continental Airlines, which flies around the world.
The airline's Aug. 1 arrival means Waco fliers have a choice, something they had not had since Continental left the market after the terrorist attacks of Sept. 11, 2001. Travelers can fly American Eagle to Dallas-Fort Worth International Airport, where they can link up with American Airlines, or they can take SkyWest to Houston.
Waco fliers are enjoying the new service, as well as the price war SkyWest's arrival has created.
Airport departures were up 75 percent in November 2003 from November 2002, statistics show.
-- TSTC REGIONAL AIRPORT: The Texas State Technical College airport likewise generated some news last year, with civic and business leaders talking about turning it into a regional airport.
Former Waco City Councilman Bill Carden -- who in May lost his re-election bid to Maurice Labens -- said TSTC airport could become Alliance Airport South, comparing it with Ross Perot Jr.'s airfield north of Fort Worth, where Fortune 500 companies have placed plants and distribution centers.
Other proponents point out that the TSTC airport sits near Interstate 35, whereas Waco Regional Airport is 12 miles away from the highway. A 1,000-acre industrial park called Texas Central Aeroplex has been created near TSTC airport, and it is ready to welcome new industry.
President Bush uses TSTC airport when he flies into Central Texas to visit his Crawford ranch.
If TSTC were to become a regional airport, the commercial airlines that now fly out of Waco Regional Airport would fly out of TSTC. Meanwhile, Waco Regional could serve as a general aviation airport, accommodating private fliers, for example.
Talk of making TSTC a regional airport has died down, with city officials preoccupied with efforts to save the Waco VA Hospital. But the issue may find new life in the future.
-- NEW HOSPITAL: Hillcrest Health System dropped a bombshell in September, announcing it would spend $100 million to build a children's and community hospital next to the Wallace Jewell 16-screen theater on U.S. Highway 84 in Woodway.
Arthur L. Hohenberger, president and CEO of the system, said construction will begin late this year or early next.
When the facility is finished, Hohenberger said, Hillcrest probably will need to increase employment by 450.
And Hillcrest is not stopping there. It has pledged to spend $15 million improving its main campus on Herring Avenue in North Waco.
Additions will include a Heart Care Center of Excellence.
Real estate agents say they already are getting inquiries from physicians wanting to build offices near Hillcrest's new hospital.
Retail and restaurant development also could spring up around it.
-- COMING & GOING: Jack Stewart, 58, left the presidency of the Greater Waco Chamber of Commerce last year to become executive vice president for business development at WCI Texas, a local construction firm.
Stewart had served as the top paid employee of the chamber for 13 years. During his watch, Waco attracted the Coca-Cola juice plant, later renamed the Minute Maid plant, and a Caterpillar dump-truck manufacturing plant that has temporarily closed but may reopen.
He also administered the economic development fund that Waco and McLennan County created to attract industry. Each pumps $750,000 annually into that fund, which helped Waco land a new Wal-Mart return center and Tractor Supply's new distribution facility.
The chamber's executive committee continues to search for Stewart's successor.
L-3 also found itself looking for a new local chief, and found one in retired Navy Rear Adm. John E. Boyington Jr., 56. Boyington, who ended a 33-year military career last year, succeeded Iverson, who retired at age 61.
Richard Howell, 47, was hired last year as Waco's new aviation director, following Jimmie Hanes, who resigned in late 2002 but had been serving on a contract basis. Howell, a San Francisco native, most recently directed the Southwest Georgia Regional Airport.
-- COAL PLANT IN RIESEL: Could the community of Riesel become home to a $1 billion coal-powered electricity generating plant?
The deal is not final, but LS Power Development Corp., based in St. Louis, confirmed in September it is looking at Riesel as the possible site of a plant that would cost between $500 million and $1.2 billion.
Such a plant would have a staggering impact on the local tax base. For example, the Riesel school district's tax revenues last year were $746,000. If the district were to charge LS just more than half of its current tax rate of $1.63 per $100 property valuation, LS would pay roughly $8.6 million a year in school taxes on a $1 billion facility.
LS would put about 1,200 people to work building the plant, which would employ 100. The company had considered other sites in Texas, but it is serious enough about Riesel to have begun negotiations with landowners.
-- ADIOS KMART, PICCADILLY: In September 1994, Kmart opened a new 190,000-square-foot supercenter at New Road and Franklin Avenue.
That was before Wal-Mart, Lowe's and Franklin Village arrived at that intersection. Kmart was a pioneer, in that respect.
Alas, the supercenter closed in 2003, ending Kmart's presence in Waco.
It was among 53 locations in Texas and more than 300 nationwide that the retailer shuttered as part of its reorganization under bankruptcy protection.
Fans of the Piccadilly cafeteria chain also felt the sting of abandonment last year.
Waco's only two locations -- at 1800 N. Valley Mills Drive and in Richland Mall -- were shuttered as Piccadilly sought to cut costs.
LOCAL BUSINESS LEADERS RANK TOP STORIES OF 2003
The Tribune-Herald asked several business people to identify what they thought were the top five local business stories of 2003. They could include national business trends that had a local impact, or they could choose to identify business stories that were exclusive to Waco.
These leaders represent something of a cross-section of Waco's business community; they include the owner of a small business and representatives of the Greater Waco Chamber of Commerce. That mix created a variety of stories on the respective lists.
Appearing on several lists was the proposed closing of the Waco Veterans Affairs Hospital. Federal officials have proposed a $4.6 billion restructuring of veterans health care nationally and have suggested the closure of seven VA hospitals, Waco's among them. The final decision rests with VA Secretary Anthony J. Principi, who toured Waco's 71-year-old hospital on Friday.
Central Texas Marketplace, a $70 million shopping complex, also was a popular choice. Construction began in 2003 on the center, which is going up at West Loop 340 and Interstate 35.
Some of the choices reflected the business leaders' own concerns. Mike Barnes, president/economic development for the Greater Waco Chamber of Commerce, focused almost exclusively on Waco's success at attracting or keeping industry.
Sammy Citrano, a restaurant owner, picked Waco's new smoking ordinance as his No. 1 story.
No doubt many business stories didn't get mentioned. It was also an eventful year for the national economy and international affairs. But perhaps the following lists provide some indication of broader events.
SAMMY CITRANO, owner, George's Restaurant & Catering; spokesman, Waco Restaurant Association:
. "The smoking laws in Waco." In June, the city's new smoking ordinance went into effect. It bans smoking in most public buildings, with some exceptions for small businesses, tobacco shops and bars that don't serve food. Businesses can allow smoking in walled-off, separately ventilated areas, and restaurants can allow it anywhere between 10 p.m. and 2 a.m.
. L-3 Communications getting more contracts." Waco's largest employer received an additional $30.3 million for aircraft modifications in the defense budget Congress approved in 2003.
. "Tractor Supply and Wal-Mart distribution centers." Tractor Supply opened a 305,000-square-foot distribution center that eventually will employ 170, while Wal-Mart began work on a merchandise return center that will employ 300 when it opens later this year. These projects were announced in late 2002, but work began on each in 2003.
. "Ongoing tourism President Bush brought to Central Texas."
. "Construction at Baylor University." Baylor has launched a multimillion-dollar construction campaign as part of its Vision 2012 initiative.
GREG MAY, owner, Greg May Honda:
. "Proposed closing of the Waco Veterans Affairs Hospital."
. "Central Texas Marketplace."
. "Jack Stewart resigning as president of the Greater Waco Chamber of Commerce." A replacement has not been named.
. "Kathy Rice stepping down as Waco city manager."
. "Proposed hotel/conference center on Lake Brazos." Bill Hindman Jr. of New Orleans has proposed placing a 238-room, four-star hotel and conference center worth $40 million between Lake Brazos and University-Parks Drive.
MIKE BARNES, president/economic development, Greater Waco Chamber of Commerce:
. "Do It Best Corp. spends $10 million to expand its Hewitt Drive distribution center by 200,000 square feet, creating 20 new jobs."
. "Marathon Power Technologies buys out Norco Inc. of Ridgefield, Conn., and relocates it to Waco, creating 43 new jobs."
. "The Dwyer Group breaks ground on a $1 million office building, with space for more than 40 employees. It also acquires NeoCom Inc., an Ohio-based company that creates private-label software for franchisors, and moves it to Waco."
. "Phoenix Equipment moves into a larger building on Panther Way, and is hiring 25 additional people."
. "The Texas Economic Development Council honors the Waco chamber for its business retention program."
LISA AUGUSTINE, manager, Waco Hilton; president, Waco Hotel/Motel Association:
. "President George W. Bush's presence in Crawford continues to be a very big part of the business community. The frequent visits by dignitaries, including those from Japan, Australia and Italy, are significant."
. "The continued building and expansion at Baylor University benefits Waco not only from a business perspective but from a quality of life perspective. The school continues to move toward its Vision 2012."
. "Waco is seeing a retail explosion, from the shopping facility being opened on State Highway 6, to the Target Greatland and the shops popping up around it, to the new Eckerd and Krispy Kreme opening up on New Road."
. "Continental Airlines resuming air service to Waco this summer is wonderful. That will help with economic development."
. "The new softball complex (Waco Riverbend Park) already has brought a significant number of visitors to Waco, and the numbers will only increase as the years go by. Our research shows that it rivals any such facility in Texas."
KEN COOPER, Cooper & Horn Builders:
. "Baylor University expansion. I see that as a positive impact on Waco's economy and quality of life, especially the Mayborn Museum Complex and the new Baylor Sciences Building."
. "The new mall, Central Texas Marketplace. I think it's going to be a regional attraction, with new stores, better deals, more options. It will keep people in Waco instead of traveling to Dallas and Austin."
. "Highway 84 growth. Hillcrest's announcement will have an impact on us. Andy Horn and I have had doctors tell us they want to be in our Hidden Valley subdivision, but it's difficult to justify the time it would take to get to Hillcrest's existing location. With Hillcrest moving to 84, we should see additional growth on the west side of town."
Hillcrest Health System in September announced it would spend $100 million to build a children's and community hospital next to the Wallace Jewell 16-screen theater on Highway 84. Its main campus will remain in North Waco.
4. "Proposed closing of the Waco Veterans Affairs Hospital. I have it at No. 4 only because its fate has not been determined."
5. "The success of Curves International." Waco-based Curves has grown to 6,734 women's exercise locations in the United States, Europe and elsewhere. Founder Gary Heavin is building a new international headquarters on Highway 84, near the First Baptist Church of Woodway.
CAROL WEAVER, owner, Mattress Sleep Centers:
. "Waco's no-smoking ordinance. I agree with it. I like the fact I can go into a restaurant and don't have to walk past the smoking section before I eat, though I know some people like a cigarette after their meal."
. "Central Texas Marketplace."
. "Possibility of the Veterans Affairs Hospital closing."
. "The Tractor Supply warehouse."
. "The Wal-Mart return center, and construction of the new Wal-Mart Supercenter on Hewitt Drive."
JIM HALLER, executive vice president, First National Bank of Central Texas; chairman, Greater Waco Chamber of Commerce:
. "I think the possible closing of the VA hospital would have to top my list. I'm so impressed with the way city and county officials have led the fight to keep it, and with the determination this community has shown. If we keep it, that's wonderful; if we lose it, that's absolutely horrible."
. "I think the Tractor Supply distribution center is big for our city.
Not only because of the people it employs but because it is sitting in such a prominent place on Interstate 35. It shows what a nice new facility Waco has."
3. "Right up there with Tractor Supply is construction of the Wal-Mart return center."
4. "The new shopping center at Interstate 35 and Loop 340 is huge.
Having all that traffic at a busy intersection is another image boost for Waco. And we're getting some stores we've coveted for a long time."
5. "The many impressive construction projects at Baylor University, especially the science center and discovery center, are good indicators of the future of Baylor. And as we all know, Baylor means a lot to our city."
-- Compiled by Mike Copeland
