Banks, biotechs and buyouts
2007 was marked by expansion in several sectors
Despite a few closings and consequent layoffs this year, Frederick County’s business community welcomed a steady stream of new companies — from biotechs to biodiesel — and solid growth in retail, banking and biotech sectors.
The city’s landmark Coca-Cola distribution plant shuttered, but a Colorado brewery planned to shift all operations to its Wild Goose Brewery in Frederick. MedImmune forged ahead with its $250 million manufacturing plant expansion. Two destructive fires — in Frederick’s Antietam Village and in downtown Mount Airy — displaced dozens of businesses, but they found support from community outreach and most landed in new locations.
As PNC Bank took over Mercantile branch offices, including 14 in Frederick County, a few small local and regional banks planned openings in a downtown thriving in the wake of Carroll Creek renovation opening.
Despite the meltdown in the mortgage industry, Wells Fargo Home Mortgage’s proceeded with plans consolidate its regional operations in Frederick with a newly built headquarters in Riverside Corporate Park. The company’s roughly 1,500 employees started moving to the new $60 million building in July. The Frederick office is a regional center for much of the East Coast that includes groups that conduct work nationwide.
Several biotechs graduated from the county’s expanding incubator system and set up shop locally, including one along Carroll Creek. Meanwhile, large-scale commercial and industrial projects such as a Costco Wholesale distribution center and Stanford Industrial Park moved forward.
In agriculture, most crop farmers struggled during the summer’s drought, but vineyard owners celebrated what they believe will be a stellar year for Maryland wines.
Roller coaster year for Frederick’s incubator
The Frederick Innovative Technology Center, the county’s business incubator system to support emerging biotech and science companies, skated into 2007 with the opening of its second location.
The center was started in 2004 at Hood College by a group of volunteers and was backed by the county’s Office of Economic Development. In February, it branched into a second space on Metropolitan Court.
‘‘The incubator program has been successful beyond our imaginations,” said Marie G. Keegin, then director of the county’s economic development agency.
The incubator quickly met capacity with new clients, including BioElectronics Corp., which manufactures electronic healing patches, and Advanced Product Enterprises LLC, which is working on protein modification toward AIDS research and testing for biodiesel fuels.
Akonni Biosystems Inc., in the Hood College incubator, snagged a $450,000 grant from the federal government this year to ramp up its forensic DNA research and development program. Akonni became the third company to fly the incubator nest when it moved into a renovated warehouse on Carroll Creek last fall.
The state approved legislation allowing counties to exempt incubators from property taxes, but incubator director Michael Dailey could not persuade the Frederick Board of County Commissioners to grant the exemption. Dailey said it would help the incubator remain competitive but the board voted 3-2 to deny it.
PNC mega-mergerhighlights bank shifts
PNC Bank of Pittsburgh converted its newly acquired Mercantile branches on Sept. 20, replacing signs and logos at 14 offices in Frederick County.
The changeover marked the most significant move in the county’s active and growing banking industry. The merger led PNC to cut more than 540 Mercantile jobs in Maryland: 323 in Linthicum, 80 in Baltimore and 51 in Frederick.
PNC acquired Mercantile Bankshares of Baltimore for $6 billion in March. Mercantile’s branches continued to operate under their 11 affiliate names, including Farmers & Mechanics, until September.
The combination of PNC and Mercantile had about $119 billion in assets and 1,092 branches at the start of 2007. PNC reported $2.6 billion in net income in 2006. Mercantile was Maryland’s largest bank with $17 billion in assets and 3,700 employees, about 80 percent of whom worked in the state.
PNC has identified expansion opportunities in Annapolis and the Baltimore area to maximize its presence in Maryland.
Smaller banksopen downtown
Smaller banks have been cropping up downtown, as their officials say there is room to flourish with the right personal connections.
Frederick County is the seventh largest banking market in Maryland. From June 2006 to June 2007, the county’s banks drew $44 million more in deposits compared with the same period the previous year, according to the Federal Deposit Insurance Corp.
Blue Ridge Bank is set to open in the spring at 18 W. Patrick St., with a focus on commercial loans and lines of credit, commercial real estate loans, construction and development loans, and home equity and consumer loans in Frederick, Washington and Montgomery counties.
J. Brian Gaeng, president and CEO said the bank’s seven executives, all of whom have worked for Fredericktown Bank and Trust, a Mercantile affiliate, are ‘‘kind of reuniting.”
‘‘This is a business very much about relationships and we have a very experienced team,” Gaeng said. ‘‘We’ll be targeting the business community. The strength of these relationships will be related to our ability to grow the balance sheet.”
Graystone Bank of Harrisburg, Pa., opened on Market Street in October, and Wachovia Bank of Charlotte, N.C., opened its first Frederick branch along Carroll Creek this summer.
Six new offices opened from June 2006 to June 2007: First Tennessee Bank; two Frederick County Bank offices; Chevy Chase Bank; Columbia Bank; and Sovereign Bank. A Bank of America branch closed.
Closures includeCoca-Cola plant
With 52 employees and nearly 100 years in the city, Coca-Cola Enterprises announced it would its Frederick plant by the end of March, citing growth constraints.
The landmark 21,000-square-foot building at 1205 N. Market St., where a large Coca-Cola bottle perched on the roof has drawn tourists for decades, has housed the company for about 60 years. Before that, Coca-Cola operated at locations on North Market Street and Patrick Street, spokesman Curtis Etherly said.
Most of the company’s 52 employees will likely be relocated to one of its 10 other facilities in Maryland, including in Rockville and Hagerstown, Etherly said.
With a growing product base, Coca-Cola’s truck traffic has increased but the Frederick site has little room to accommodate more vehicles or expand the plant, Etherly said. Each week the plant has roughly 75 large vehicle visits, from both 18-wheelers dropping off products at the plant and smaller delivery trucks.
Meanwhile, Maryland Midland Railway of Union Bridge announced in October that it would be sold to Genesee & Wyoming of Greenwich, Conn., for $29.1 million, but David Bordner, Maryland Midland CEO said it was too early to tell how employees would be affected.
Maryland Midland’s largest customer is Lehigh Cement Co. of Allentown, Pa., which closed its Woodsboro plant in July, citing lack of natural resources in local quarries. Lehigh upgraded its facility in Union Bridge.
Sensata Technologies Inc., a technology component manufacturer, said in August it planned to move 85 jobs out of its old Airpax offic at 550 Highland St. in the next year as it moves its manufacturing to China and Mexico. The company acquired Airpax Holding Inc. on July 27 for $276 million.
Global door manufacturer Masonite International Corp. closed its plant in the BlueLinx Complex in Frederick in July, with 70 layoffs. Many employees were offered jobs at other locations. A spokesman said the branch was closing due to a ‘‘significant loss of business.”
Finally, Mount Airy Cold Storage was shuttered and demolished its building in August to consolidate operations in Perryville, in Cecil County near Havre de Grace. Owned by MHW Group of Owings Mills, Mount Airy Cold Storage employed 30 people and planned to double its operations to employ about 60 in Perryville.
Brothers launchbiodiesel operation
Three Butz brothers at Windridge Farm near Buckeystown and partner Eric Franzoi came closer to realizing their dreams of starting a biodiesel plant in Baltimore’s Curtis Bay this year.
If all goes well in 2008, the facility will start churning out 10 million gallons of the relatively eco-friendly fuel annually.
Biodiesel, made from soy oil, chicken fat and other greasy organic products, requires a fine-tuned process that the engineers have been trying to perfect in their makeshift facility, a former tilapia warehouse.
Jeremy Butz said he hopes widespread use of biodiesel will relieve the United States of its dependence on foreign oil, while creating a fuel with multiple benefits for the environment. Biodiesel reduces net carbon dioxide emissions by 78 percent compared with petroleum diesel, according to the U.S. Department of Agriculture.
The new venture, Chesapeake Green Fuels, anticipates hiring upward of 25 employees through Maryland’s Enterprise Zone program.
MedImmune clingsto tax break
County commissioners this summer considered rescinding a $5 million tax break it had granted MedImmune last year, as the Gaithersburg biotech works on its $250 million expansion project in Frederick. But the board voted 4-1 to delay consideration until the company actually seeks reimbursement for infrastructure improvements related to the project.
MedImmune, acquired this year by AstraZeneca of London for $15.6 billion, is expanding its manufacturing facility off Ballenger Creek Pike. The project is set for completion in 2008.
BP Solar forges ahead
Across Interstate 70 from MedImmune, BP Solar broke ground in July on its $70 million expansion of its manufacturing plant and headquarters on Solarex Court.
The 140,000-square-foot expansion will double manufacturing capacity of silicon processors for solar panels and provide 70 new jobs. The facility is expected to be the largest solar panel plant in the nation.
The target for completion is the end of 2008.
With 511 employees, BP Solar is among the top 20 employers in Frederick County.
Commercial, industrialmarkets thrive
While the nationwide housing slump reverberated locally, commercial projects were flourishing in Frederick County’s industrial and commercial regions.
Most recently, Costco scored site plan approval for a 12-acre distribution center near New Market after some debate about anticipated traffic flow patterns.
The 525,000-square-foot warehouse is to be developed on 84 acres in the Intercoastal Industrial Park next to Adventure Park USA.
The warehouse is expected to create from 150 to 200 new jobs.
At Fort Detrick, a joint venture of Pittsburgh and Texas interests is developing a $50 million hotel and conference center complex.
Fort Detrick Properties LLC, formed by Dick Corp. and Hunt Development Corp. of El Paso, will lease a 20-acre site on the Bio-Defense Campus.
And in southern Frederick County, developers of Stanford Industrial Park on Mountville Road and Route 15 near Buckeystown are entering the next phase on a fourth Stanford Trading Center project.
Ruppert Properties of Laytonsville sold off many lots in the 75-acre industrial park for other companies to develop but kept ownership of at least nine lots for its Stanford Trading Center, which it will lease.