Sixth in a Series: A Rising Southside
This week we continue our series about the economic, educational and cultural growth on San Antonio’s Southside. See below for links to the first five stories, including the series opener, “It’s The Decade of Downtown, But Don’t Miss San Antonio’s Rising Southside.]
Community Connections Run Deep
The land that was once Kelly Air Force Base has played many roles. Its growth is closely tied to world events and its spirit of innovation leads the way forward.
Its founders exemplify how hard work is at the heart of any success story. For almost a century, as the world changed, they adapted the large property straddling San Antonio’s Southside and Westside, creating a center for industry that has provided opportunities for generations.
Over the decades Kelly grew into the region’s largest employer as aircraft maintenance became the specialty of its civilian workforce. The site became synonymous with good jobs— credited with giving rise to the region’s Hispanic middle class.
So when news of Kelly’s closure came in 1995 following the Cold War’s end, San Antonio mustered its can-do attitude to devise new uses for one of the region’s largest economic engines.
As the clock wound down, community leaders devised the framework that would transition the property to new uses and stem feared job losses.
From their work the Greater Kelly Development Corporation was created—the organization that would become Port San Antonio, whose mission is to redevelop the former base to its best and highest use while creating conditions that maintain and grow quality jobs.
The Port’s structure was the result of innovative problem-solving. Created as a political subdivision of the state, the organization is also set up to run as a business enterprise in government.
While its board of directors is appointed by City Council—providing a strong link between the Port’s work and community growth—it is a stand-alone state entity whose board’s fiduciary responsibility is specifically to the Port.
Furthermore, it does not receive public dollars for operations, instead earning its income through leases and services it provides as it oversees the region’s largest commercial real estate portfolio, totaling 13 million square feet. Profits are re-invested into further development that benefits the local economy–therefore functioning as a government entity that runs like a business.
Massive job losses never materialized following Kelly’s closure, most notably thanks to local leaders’ collaboration with federal officials to develop a staged six-year closure process between 1995 and 2001. This window of opportunity enabled the redevelopment authority to attract private industry.
During this time the first arrivals kept momentum going—Boeing, Lockheed Martin and Pratt & Whitney leased hangars and workshops and continued to support military aircraft. Since the companies successfully competed for Air Force maintenance contracts, for many workers the transition was seamless. One day, they were Department of Defense employees. The following week, they worked for leading private sector aerospace firms.
A Strategic Vision For Growth
Today, Port San Antonio is home to more than 80 organizations which employ 13,000 workers. According to a 2010 study by the SABÉR Research Institute, a collaboration between St. Mary’s University and the San Antonio Hispanic Chamber of Commerce, they generate over $4 billion in annual regional economic activity.
That core group of customers has grown into a cluster of 14 aerospace-related businesses at the Port’s industrial airport, Kelly Field, and now employ 4,000 workers.
Furthermore, the aerospace industry has diversified at Kelly Field. Among these successes is Gore Design Completions, which relocated its headquarters to the Port in 2005. Since that time, Gore’s workforce has grown from 150 to 600 workers who specialize in building sophisticated luxury interiors for owners of large aircraft. With strong demand from a clientele that includes world leaders and other VIPs, coupled with the talent of a growing and diverse local workforce, Gore has become a global leader in the highly specialized field.
The Port’s early customers have also broadened their horizons, with Boeing adding upgrades to new 787 Dreamliners and 747-8 air cargo freighters to its local work in 2011. And last year the company announced that it will bring the president’s executive fleet, including Air Force One, to its Port location to undergo maintenance.
Lockheed Martin’s Kelly Aviation Center is also extending its range. A specialist in serving military engines since 1998, the lines it supports also power commercial aircraft, including Boeing 737, 747 and 767 models.
And the Port, too, has diversified its customer base.
Many San Antonians might be surprised to learn that half of workers at the site are Air Force personnel.
While the Air Force originally expected to completely vacate the former base, that prospect changed in 2005. That year’s new round of base realignments triggered an influx of military personnel to the region as part of worldwide consolidations.
Faced with an urgent need for specialized facilities to house new arrivals, the Air Force relied on Port San Antonio’s construction expertise to deliver office buildings that meet stringent requirements against terroristic threats. Accordingly, in 2007 the Port began a $70-million overhaul of a 1940’s era 460,000-square foot building and adjacent properties to house incoming personnel.
Today, the five-building complex at the Port exists within a secured perimeter known as Lackland Annex. The state-of-the art facilities house important operations, including headquarters for the 24th Air Force, also known as the Cyber Command, which oversees Air Force network security worldwide. The property is also home for other headquarters, including the Air Force Civil Engineer Center (AFCEC), the Air Force Medical Operations Agency (AFMOA) and the Air Force Services Agency (AFSVA), among others.
Of 6,500 Air Force Personnel at the Port, most are civilian professionals, including engineers, environmental specialists, programmers, attorneys and architects.
Adding to the diversity of enterprises are logistics-based industries, which are seeing particular growth at the Port’s 350-acre East Kelly Railport. Largely unused by the military in the years before Kelly’s closure, it has attracted new private industries, including logistics specialists RLI Logistics, Fiesta Warehousing & Distribution and Operational Technologies.
Thanks to the railport’s direct connections to BNSF Railway and Union Pacific Railroad trains, railcar activity has steadily grown, with a focus on supporting the construction, manufacturing, retail and energy industries. The advent of Eagle Ford Shale has been a particular boon at East Kelly, which is now a strategic center for distribution of pipe, equipment and supplies that arrive from afar by train and are loaded onto trucks for deliveries to well sites throughout South Texas.
Manufacturing is also growing at East Kelly, most recently with the 2012 arrival of Bergstrom Climate Control Systems, which builds air conditioning units for semi-trucks for use in the U.S. and Mexican markets—again showcasing the strategic location and flexibility of the Port’s as manufacturing returns to American shores.
Just the Beginning
While the Port’s contributions to the regional economy are many, there are even more opportunities ahead.
Thanks to the City of San Antonio’s realignment of 36th Street and its extension into the heart of the Port, 400 acres are now available at Kelly Field for the construction of new facilities with runway access. This means that additional hangars and workshops can be built to advance the aerospace’s industry’s growth. Upon full development, this land could support 8,000 new jobs, according to SABÉR economists.
Similarly, 150 available acres at East Kelly will help expand logistics and manufacturing operations, with additional support provided by recent rail expansions. In 2012, the Port partnered with Watco Companies, a developer and operator of short-rail lines, to double rail tracks from four to eight miles at the railport. The new infrastructure allows a four-fold increase in rail cargo capacity, which is of special importance as industries nationwide turn to rail as a significantly more efficient mode of transport.
And to support the Air Force’s continued needs, the Port’s master plan identifies 45 acres next to Lackland Annex as the ideal site for up to one million square feet of new facilities for military headquarters and contractors. Furthermore, the Port is in talks with local officials to lease vacant city-owned land north of Lackland and, with private investment, help the Air Force develop additional facilities in the years ahead as Lackland Air Force Base continues to add personnel.
What’s more, there are opportunities with important regional implications as 36th Street continues to grow. In addition to the current extension of the street from the Port’s northwest entrance into the heart of the property at Billy Mitchell Boulevard, which now opens additional land for aerospace growth, the city’s 2012 bond package included $6 million that, starting next year, will extend the street by an additional mile to General Hudnell Boulevard, providing redundant access for both logistics customers and thousands of commuters who work for Air Force and aerospace organizations at Kelly Field.
Next steps in the evolution of 36th Street will be an extension to the south beyond the Port and across the Union Pacific South San Antonio Classification yard. This will provide an important direct connection between the Port and the Southside community. As additional funding is identified in the years ahead, the 36th Street extension will become Kelly Parkway, which was added to the regional thoroughfare plan by city ordinance in 2003. The future road, which will extend to IH-35 to the south and have quick access to Highway 151 to the north, will create an important corridor uniting fast-growing northwest Bexar County with economic engines to the South, including the Port, Toyota and Texas A&M-San Antonio.
At the heart of Port San Antonio’s vision is strategic support of its customers by helping them identify and train the best and brightest workforce.
In today’s world, companies’ site selection decisions are not predicated solely on the availability of space and facilities. Access to a well-qualified workforce is often of paramount importance. This is particularly true in aircraft maintenance and manufacturing—fields where the Aerospace Industries Association indicates that half of U.S. workers will be eligible to retire by decade’s end.
Accordingly, Port San Antonio has built strong partnerships with its customers and area educators, particularly Alamo Colleges and St. Philip’s College, which operates its Southwest Campus at East Kelly Railport.
One of the most innovative joint efforts began in 2011. Faced with the need to expand the thriving St. Philip’s Southwest Campus, Alamo Colleges purchased an adjacent 40,000-square foot building and 30 acres of surrounding land at East Kelly Railport from the Port at a market cost of $5.1 million.
Under the agreement, Alamo Colleges may pay the Port through workforce development—reducing the debt each time the school places graduates with aerospace companies at Kelly Field or for training programs it develops to help existing aerospace workers tackle new projects. This creates a win-win for the school, the Port and the community as well as a powerful incentive for the aerospace industry.
As a further commitment to workforce, the Port has focused on creating a dynamic environment in its center property. Kelly Center encompasses 400 acres that include the St. Philip’s College Southwest campus and new buildings and historic properties to become part of an emerging, innovative environment.
The Port has already taken steps toward its vision of creating spaces that capture the imagination and help build bridges toward the future. It is a regional leader in green construction, with two LEED-certified buildings already completed.
And earlier this year, it was among three regional sites participating in the San Antonio River Authority’s Low Impact Development (LID) competition, thereby helping promulgate best building practices in the region.
To further attract a strong workforce, the Port is also growing its residential offerings at Kelly Center, including refurbished 1940’s duplexes that were once officers’ quarters and townhome apartments at Billy Mitchell Village—former military family housing that the Port began upgrading and leasing to the general public in 2011 and which are now home to several families employed by organizations at the Port.
To ensure that future growth of Kelly Center aligns with the workforce needs, the Port has partnered with customers, members of the community and experts in education, urban planning and architecture to guide a visioning process for this center property.
The focal point of the group’s thinking is a Kelly Science and Innovation Commons –land where historic buildings and new mixed use development will showcase new and emerging technologies by focusing on, and adapting to, workforce needs.
The Port’s objective is to grow partnerships with its customers, the community and other stakeholders to create a platform that serves as a magnet for future workers and aligns education and workforce development priorities.
Planning foresees the inclusion of a learning laboratory and integrative demonstration platform that engages the imaginations and aspirations of industry, educators, workforce development training and service providers.
Most importantly, it will attract and inspire future generations of workers, to carry forward the 1,900-acre property’s legacy as a place where futures are built.
Bruce Miller has extensive experience in urban design, planning and economic development. He worked in commercial real estate with Dallas-based Vantage Properties, Inc., and served as the CEO for the Rickenbacker Port Authority, Columbus, Ohio, which, as an Air Force Base, closed in 1979. Mr. Miller is responsible for leading the organization through the planning, marketing and development of Port San Antonio, the former KellyUSA.