News & Views

Episode 46: Examining the Mega Deals: 26 Minutes with the Site Selection Group’s Brett Bayduss

Last month, the Dallas-based Site Selection Group came out with a new report that really caught our eyes here at DCI. The report was titled “Megasite Selection Deals Winning Big Incentive Packages and Tightening Labor Markets Across the United States.”  The report looked at 35 major projects – a mix of new location and expansions – that have taken place in recent years. These projects involved big job numbers (generally 1,000 or more new positions) and well-known companies (Facebook, State Farm, USAA, Adobe Systems, Apple, Liberty Mutual and Salesforce). We wanted to know more about the report so we invited the Site Selection Group’s Executive Vice President Brett Bayduss to sit down with us in our New York City offices.



Andy Levine (DCI): Back in June 2018, the Dallas based Site Selection Group came out with a new report that really caught our eyes here at the DCI.

Patience Fairbrother (DCI): The report was titled, “Mega Site Selection Deals Winning Big Incentive Packages and Tightening Labor Markets across the United States.”

Andy: We wanted to get more insight on the findings so we invited Brett Bayduss, the Site Selection Group’s Executive Vice President in to talk with us.

So welcome to episode 46 of The Project: Inside Corporate Location Decisions. I’m Andy Levine of Development Counsellors International.

Patience: And I’m Patience Fairbrother, also with DCI, and Andy’s co-host of “The Project.”

Andy: So, Patience, we have now completed or with this, we will have completed 46 episodes. The question here is, what are we going to do to celebrate on our 50th episode?

Patience: It’s pretty hard to believe we’ve done almost 50. Well, what’s the tradition here? Should we do a song and dance episode finally?

Andy: No. I think that would end all future episodes. That’s a very bad idea, but…

Patience: Okay. We’ll skip that this time.

Andy: Something with champagne I think would be in order.

Patience: That sounds more like it.

Andy: Okay. No song and dance. Okay, back to reality and we’re gonna talk about today’s episode. The Site Selection Group did something pretty interesting here. They looked at 35 major projects, some new locations, some expansions, that have taken place in the last 3 or 4 years.

Patience: So here’s what these company announcements had in common. Number one is big job numbers. Generally, 1,000 or more jobs were created. Number two is well-known companies. Facebook, State Farm, Snapchat, USAA, Adobe Systems, Liberty Mutual, and Salesforce. Number three, finally, most of these companies were looking for a campus-like setting for their new or expanded operations.

Andy: The report is again titled, “Mega Site Selection Deals Winning Big Incentive Packages and Tightening Labor Markets across the United States.” Not the fastest, easiest title to get off my lips there, but it’s available on the Site Selection Group’s website and we also are gonna include a link in the show notes section of this episode. What’s one of the more fascinating aspects of this report is a map of the United States which shows the different cities winning these different location announcements.

Patience: And the map also includes the 20 cities shortlisted for Amazon’s HQ2 project, from Los Angeles to Boston. So here’s Andy’s interview with Brett Bayduss, Executive Vice President of the Site Selection Group.

Andy: So, Brett, we’re delighted to have you joining us here in our New York office today. Thanks for coming in and talking about this report.

Brett Baydus (Site Selection Group): Great. Thanks for having me and it’s always a pleasure to speak with you.

Andy: So, the Site Selection Group recently did, kind of, a paper and, sort of, looked at the strong uptick in activity for large corporate campus projects. And you talked about Amazon but also State Farm, ADP, Snapchat, Adobe, a bunch of others. What do you think is driving this increase in activity right now?

Brett: Yeah. And, you know, it’s interesting because although the paper addresses these as probably more recent activity, some of those that we’ve referenced probably made the commitment to new growth and expansion about five years ago. So, I don’t think that what we’re seeing is a new phenomenon as much as, I think, we’re probably seeing more of the, kind of, publicity around some of these locations. And there’s, I think, you know, kind of referencing State Farm as one of the companies that you mentioned. I mean, they committed to doing these large campuses, probably back in 2012-2013. So, I mean, it’s about five years of when they’ve started that to where they’re finally operational, to getting the numbers that they’re expecting. But those were, you know, 3, respectively, were each about 8000, 10,000 employees.

And I think, maybe, at least from what I’ve seen, that probably had more of the impact on other companies looking to kind of grow and kind of…maybe they were doing it in the past, but I think this put it to the forefront of “Should we be doing this as well?” Because these are pretty big expansions and they, kind of, changed the way that they were making it also like a live-work-play and creating more of cities within just like their campus environment. So, I think that, probably, from my experience, is what started it, at least from some of the clients that we work with that then said, “Hey, we’re seeing State Farm do this, should we be doing this as well? And where should we be looking to grow these operations, and how large can we get?”

So I think that probably, at least from the projects we’re working on, that that maybe was a catalyst to seeing a lot more activity, but I also think they’re getting a lot more, as I mentioned, publicity around these large operations. And I, kind of, see that as two factors may be driving that. One is you have Amazon that obviously, is really fresh in everyone’s mind of doing this big campus relocation, and not only is that echoing within the industry that we’re within, you know, the real estate and the corporate site selection, but it’s also every person across the country is hearing about Amazon. So, even if they’re not associated to doing this type of work, they’re now hearing and reading about it. And I think that’s picked up more, you know, publications of tracking other companies doing large growth plans. And I also think the unemployment rate being as low as it is and seeing just record lows, I think it’s putting a lot of emphasis on “Can companies grow this large?” So…

Andy: I wanna go there for a moment. That’s a good one. So, 3.8% unemployment rates. What are the implications of this in terms of employers trying to diversify their labor pool? Are they scared to be, you know, all their eggs in one basket kind of stuff?

Brett: Yeah. And most of the growth that we’re seeing where this is large operations, it is diversified around different skill sets. So, I mean, you know, maybe it’s not at headquarters or regional headquarters but it’s, I guess, that you could classify it under shared service or…but it is a function of IT is always, kind of, one of the main business units in addition to just general finance, accounting, operations, which could encompass, you know, call center, back office, support, you know, audit, accounting.

So, I think we’re seeing a lot of, kind of, the four or five main industry sectors that are doing these massive growths, but then you get companies like, you know, USAA that, although they have a footprint in Phoenix where they have different types of skill set use, they just announced 1500 jobs that are gonna be technology focused. So, the larger footprint within that community is gonna have more than just technology but that is a big focus that they just announced within the last, you know, six months.

Andy: One that we previously profiled in the project was Charles Schwab and their expansion in Texas. And it’s really interesting because they really, sort of, tried to estimate or guess where the labor was gonna be 20 years from now, and then, you know, locate their facility there. Some of these companies are quite smart about how they’re going about this, aren’t they? They really are forward thinking, like what I’m talking about which Charles Schwab.

Brett: Yeah, and I think there’s a lot of people who are just really seeing the long-term impact of being in these locations. I mean, you know, they’re coming out of, kind of, these headquarter locations where they’ve been grandfathered in for 50, 100 years. And I think they’re realizing that “This decision is gonna be more than just a five-year commitment.” So, you know, I think companies are starting to really think, “Where do we want this operation to be? What are we trying to create? And how do we, you know, kind of put our, you know, foothold in the community landscape, if you will, for the long-term?”

So I think that companies are really being very educated about how they’re making these decisions and I think that they’re spending a lot of time understanding the labor analytics that go behind it, and I think they also are…if they’re doing it internally, they have a team that’s very smart to help them with it or I think they’re using a lot of the consultants and the other professionals to help them guide them, kind of, through the water.

Andy: So, one of the other points in your study was, kind of, looking at the role of incentives in this. And there seemed to be a suggestion by highlighting some of the major awards. And you talk about DXC being award $115 million by the state of Louisiana. Credit Suisse, $53.9 million, in terms of their project in Raleigh, North Carolina. Are we seeing the increase, you think, in incentive awards that are coming from some states and communities?

Brett: Yeah. You know, I don’t know if it’s an increase. I just think that a lot of these projects they have the investment for the jobs, the capital that’s warranting these incentive awards. I mean, incentives are still viewed as icing on the cake. And so, I think that, although companies now are hearing about these large incentive rewards, and maybe that’s getting them to, kind of, think about their own operations and “should they be doing this,” that the focus really is still on the labor and are they making the right decision? But, I think, you know, there are still plenty of opportunities for even companies that are only bringing in 200 or 50 or, you know, 500 employees that are still getting incentives.

So, as long as they’re meeting, you know, the wage requirements and they’re meeting some of the other employment numbers that are associated to receiving these incentives, then they’re gonna get incentives as well. And maybe it’s not gonna be at the same scale that you’re hearing these large companies, but at the same time, when it’s only an operation of 200 people, that incentive amount can have a lasting effect.

Andy: So, you talked, a moment ago, about Amazon and, sort of, the approach that they took to this. And this is, obviously, not just a big topic in economic development circles, it’s a big topic, period. So they took a very public path in this and, sort of, had an open competition and, you know, 200, some odd communities participated. Is that something we’re gonna see more of in the future you think, or is this just a blip and Amazon being Amazon?

Brett: It’s a great question. And I don’t know if I really would have the answer for that, but I think, in my opinion, what it’s done is…I don’t know if any other company can really go that same route of being as public and open the way that Amazon did.

You know, there’s a there’s a risk that’s also associated with it because you now have a lot of communities that are competing for this operation and if one of those communities win, then, obviously, it’s great and everybody is, you know, excited and happy. But there’s also some losers in this situation, and that can have an impact for people, especially, you know, the general population that’s, kind of, hearing and seeing how their community is going out and trying to compete for this, and then, not necessarily winning.

And then, it could be factors of maybe they’re hearing that they don’t have the diversified skill set or they don’t have, you know, other factors that, you know, maybe can leave a sour taste in some people’s mind of, “Hey, we got excited for this. We did everything and we weren’t good enough.” So now they may not have that, you know, same…you know, they may have a tarnished reputation with the company at hand.

So, I think Amazon has products that a lot of people stand behind and love their products. So, I think, you know, there’s still, probably, even if they don’t choose that location, are gonna be excited about, you know, what Amazon has to offer. And still, kind of, Amazon is gonna maintain their name recognition, but, you know, other companies that maybe don’t have the cool technology and products that Amazon offers, and if they don’t choose that location, you know, what could that do to their overall company reputation within some of these communities that they didn’t select?

So, I do think that there’s, you know, companies are probably careful with how they’re messaging this process, and I don’t know if every company is gonna be able to kind of carry their name to still get them through the process the way that they did in such a public forum the way that Amazon was able to.

Andy: Yeah. It’s been really interesting to watch. We had Richard Florida on a couple of months ago about this very topic and he had some really strong views about, sort of, as you were saying, sort of, the potential backlash to this. You know, they’re now down to 20 cities, and when they go down to 6, does that mean 14 people are pissed off at you? There are some interesting implications there.

So, your map of project announcements, as well as some short-listed communities for things like Amazon, sort of suggested that there are some communities that are doing better than others in this competition for, you know, a large corporate campus-type of projects. Two that stood out to me as I looked at this map that you presented were Dallas and Phoenix. Can you just say a word about each and what makes these two markets particularly strong?

Brett: Yeah. And I think part of where you’re seeing a lot of the using the word “usual suspects” is also because they have a population base that can support these very large operations. And I think when you get below, whatever that number is that a company feels comfortable with, usually, it’s still, kind of, in that 1 million-2 million range. And so I think you’re seeing, kind of, the same companies or the same communities because they have the population to support it and then they also have the value proposition if they’re coming out of, like, a New York, San Francisco, or Boston. So, that almost keeps the pool limited as to [crosstalk 00:11:07]

Andy: Yeah, it’s rather really like a dozen or 20 communities.

Brett: Exactly, in many of these projects. But, you know, if it’s the case of, you know, Dallas and Phoenix. I mean, you know, they’re interesting communities because, one, they’re growing. I mean, they’re continuing to get the population base. You know, Phoenix is getting so much just inflow migration from California. And it’s maintaining its value proposition to California because people can move down to Phoenix, still kind of experience a similar culture or lifestyle.

You know they don’t have the oceans but they still have, you know, the warm weather, they have the outside lifestyle, and they don’t necessarily have to still take the same pay that they’re getting in California because the dollar is going a lot stronger. So they’re able to buy houses and they’re doing all the same…so their buying power is going as far as it would is if they’re on a higher salary, you know, in California, but that’s keeping a lot of people that are coming into Phoenix, and it’s attracting a lot of growth.

And then you have very large universities that are either right in Phoenix or in Tucson that are feeding the continued, kind of, talent pool of professionals. And so, I think, you know, that’s been, kind of, the complement of success for a market like Phoenix is you have the population growth, you have the college university infrastructure, and you still have lower cost that is almost the trifecta for, you know, for a company that’s looking to grow and expand.

Dallas is very similar, although I think Dallas is starting to see more of the wage escalation where it’s competing on, kind of…it’s interesting because if we did some operating cost comparisons of say, Dallas and Chicago, I mean, there was still a difference between being in Dallas cheaper than being in Chicago. Now it’s almost…

Andy: It’s evening out.

Brett: …it’s evening out. And I think that that’s, you know, all of a sudden, Dallas is now competing on that next tier of large Tier 1 markets. So, I mean, you’re still are always gonna have the San Franciscos, the Bostons, and the New Yorks, but then you’re starting to get like the Chicagos and the Dallas that’s, kind of, playing in that next level. So, I think that may impact companies decisions to, kind of, see, “Is Dallas still offering what it was offering five years ago?”

Phoenix, I think is, kind of, lagging behind Dallas in the sense of they haven’t reached that maturation of wage increase yet. So I think that they’re still able to, kind of, attract additional companies and they’re doing it from a…there’s always, kind of, known as more of a call-center-type community and a lot more on, like, the service and, you know, the hourly-type employees. But a lot of these companies have really grown that talent into shared service, financial service, tech. And so, I think that it hasn’t reached the maturation on those professional service skill sets that is allowing Phoenix to continue to grow and attract these really big companies. I mean, Deloitte just announced another, you know, kind of, a large presence in Phoenix which is, I think, more technology-oriented. I mentioned USAA. I mean, nationwide it hasn’t committed to, but they’re in the process of doing some expansion. And so, you know, these are pretty significant employment numbers into a market like Phoenix.

Andy: So, you know, I think Dallas had something like 9 to 10 of these projects. Phoenix had something like six. If I went one step down from that, Indianapolis had four, Atlanta had four. Any quick comments about either Indianapolis or Atlanta from your perspective?

Brett: Yeah. Indianapolis and Atlanta still are…they’re active in this type of projects. You know, what I’ve seen and what I’ve heard from a lot of clients, what makes Atlanta attractive is Atlanta has done a great job of, kind of, building its urban core, and so the downtown is now kind of morphed into Midtown, Buckhead. And so, when you’re used to a culture like in those big cities I mentioned, like the Chicagos and the San Franciscos, and the New Yorks, where you really have, like, the downtown lifestyle and you’re using mass transit, Atlanta is able to offer that. But then also, you can get 20 minutes out and have the suburban lifestyle.

So, I think it’s, kind of, been able to play nicely with a lot of these companies that are relocating because, especially, if they’re having to move their employees or if they’re trying to maintain the same culture that they had in these cities, they’re able to get, especially the millennial workforce, that can live in these real urban environments. And I think that that’s allowed Atlanta to still, kind of, compete favorably with a lot of these projects. Indianapolis, I think, it’s smaller, It doesn’t have, you know, still the same growth the way that Atlanta has had, but Indianapolis is a great feeder from a lot of regional universities.

And I think people don’t always understand how strong of a university presence there is in Indianapolis between, you know, Indiana University, Indiana State Purdue, IUPUI, Butler. I mean, there’s a lot of great schools with a lot of great talent. And if they’re not going Chicago which is, you know, three hours up the road, then Indianapolis is, kind of, the next big city location for a lot of the graduates. And I think that’s helped to, kind of, keep and attract talent that’s allowing companies like Infosys and other groups that are investing, you know, large numbers. So, yeah, Indianapolis is still, kind of, in the list of what we’re seeing, although we haven’t seen the scalability as much with projects and volume sizes as we have in, like, Dallas, Phoenix, or Atlanta

Andy: You know, as I look at the companies on your list here, they kind of fall into, sort of, two categories. One are technology-related companies. You have Apple, you have Snapchat, you have Infosys. And then the other might be either insurance or financial services, J.P. Morgan, Chase, State Farm, Liberty Mutual. Those sectors still pretty hot right now from a site-selection perspective? A lot of activity that you’re seeing?

Brett: A lot of activity but they’re also they may be under the financial service insurance umbrella, but they’re still bringing in tech jobs for those functions. So I think that you’re still getting…I mean, you have the technology-based companies, like, you know, Cognizant, where they’ve had some big announcements and, you know, some of the other, you know, groups that you had mentioned on that list.

But then a lot of these insurance financial service companies, you know, they’re increasing their claims, and their audit, and their accounting, and their finance, but they also still have the tech component to it. I mean, some of these have 1500, 2000 employees that are dedicated to just the tech side, which are that one branch of it could be as large as what a true dedicated technology company would be.

So, you know, I think they’re still…but the insurance sector and the financial service, those companies are still doing a lot of, you know, growth and exploring and, kind of, where are they currently and where should they be in the future?” So that’s still pretty active with the projects we’re seeing.

Andy: So, you work with a lot of corporate executives that are in the seat and having to make these types of decisions. If you had to help our audience understand what it’s like to sit in their shoes, these are large, fast-growing companies that, as you said, have been, you know, headquartered in one place and grandfathered there, but are they just finding that they can’t continue growth in that one spot and they have to start looking at other places? I mean, what’s in their head?

Brett: Yeah, and I think they probably feel that they can still continue to hire and grow, but maybe not to the… You know, at certain points, you always reach, whether it’s a self-proclaimed saturation, but there’s some point where you feel like you’ve, kind of, maximized the labor force. And so, I think that they’re starting to look at, “Where else are we missing or what other emerging markets, if you will, could help us to, kind of, grow?” And, you know, it’s not that they’re looking to…they’re still gonna maintain their presence and they’re still gonna, you know, grow the way that they need to in some of these, you know, current locations, but I think they’re looking at, “What are these emerging markets that, maybe, can help us think differently of the way we approach some of our business needs and, you know, or are there emerging markets from a knowledge-base that will help us in, you know, kind of, ways of attacking projects and problems?”

And so I think that’s one piece that they’re looking at. I also think that it’s developing beyond just the skill set. I mean, you need to have the talent pool to be able to support these operations, but I also think companies that are doing…at least the ones that we’ve worked with that are looking to do these big investments, they’re also looking at how they can be involved in the community and government relations and, kind of, how do they brand themselves and message themselves with the community as well?

So, I don’t think they’re just looking at it from a…it’s almost more of a holistic approach of “How do we really create an environment from the whole community and helping with infrastructure investment and doing things that are gonna be, kind of, leaving their footprint on the city and helping to, kind of, guide that the way that, you know…” So, I think it’s more than just exploring it from, “Can we hire X number of software developers?” I think it’s, “We need to check that box, but then how do we also become more involved in the community and does this community fit the culture we’re trying to create?”

Andy: So, when you are working for a company and you need to assess a labor market, what are some of the things you look at beyond, say, like the unemployment rate which is just, sort of, a general number? What tells you that that community has or doesn’t have the labor to support whatever their needs are?

Brett: So, a lot of it is looking at the demographics. It’s looking at just the skill set availability in terms of, you know, there’s ways of tracking how many people are with certain occupational skill sets and are there enough of those people currently. It’s also looking at growth projections of those skill sets and, you know, is this a population that’s gonna be growing or is this one that could be declining? So, I think that that’s…you know, you have your general demographic that are gonna help you to understand, you know, statistically, does this support what we’re trying to do?

But, you know, there’s also that qualitative piece of going out and speaking with other employers and workforce groups and. you know, partnering with the colleges and universities. And I think that’s a huge piece that a lot of these we’re doing and assessing is how strong is the university network? How are they truly a partner? What are the resources that they’re able to offer?

So I think, you know, it’s, kind of, you get what we call the “desktop analysis” which is looking at all the pure statistics. And, you know, there’s a lot of models and ways of weighting and ranking, but I do think that there is a piece of actually going out to these locations and doing these site visits. And sometimes that gets overlooked, but it’s a very strong piece of the overall process. And I think that’s another way of, you know, there’s always gonna be concerns of a market, and I think that’s one way of validating if those are true concerns or if they’re things that you can get past and make this a successful operation.

Andy: I think that’s a good note to leave it on. I really enjoyed reading this “Mega Site Selection Deals, Winning Big Economic Development Incentives, and Tightening Labor Markets Across the U.S.” report. It comes out under King White’s signature, but I have a feeling you put some of the research into this as well?

Brett: It’s all a team effort. But we are excited to do this kind of reports and, you know, appreciate the opportunity to speak with you. It’s always fun times.

Andy: Well, it’s good for the corporate site selection community as well as the economic development community here, this stuff. So, I hope you keep putting stuff out, Brett.

Brett: Will do, thanks.

Patience: So, Andy, you did the interview with Brett on this, what stood out to you about this report and your time with Brett?

Andy: So there are a couple of things. Number one, and I love maps, but I really love this map. So they did this map in which they looked at, here are 35 major deals that have happened in recent years. Here are the Amazon cities, the 20 cities and that. And it was just kinda interesting to look at, I don’t know really who the big winners were. And as we talked about in the report or in the episode, Dallas comes up really big. They have 10 wins among this group of 35. Phoenix also comes up really big with six wins. So, it was interesting to see just this concentration among those cities. There are others that are spread out, some other ones, but those two really come up very, very strongly.

And there’s one other interesting moment, and you sort of have to…if you blink, you might miss this. But in this, I ask…I look at these companies and I say to Brett, “They really seem to form in one or two categories. They were either technology companies or they’re financial services and insurance companies.” And he comes back and says, “Well, even the financial services and insurance companies, those are tech jobs we’re looking at here.” So it’s really…

Patience: Right.

Andy: All of these big things are really in the technology space, is kinda what Brett is saying in that.

Patience: So, Andy, I know you asked Brett this question, but I’m curious what you’re hearing from others in the site selection field. Are we going to be seeing more of these very public site selection searches the way that Amazon is now searching? What are you hearing on that?

Andy: So, I’ve been hearing a lot, I’ve been asking that question of people a lot and it’s really very evenly split. I would say about half the people say, “Yes, this is gonna become the norm for large companies.” The other half are saying, “No, no. Amazon’s just doing this. We’re not gonna see more of this.” I really think…I’m waiting for the end of the story. If this is successful and it works and Amazon, it really helps them find the right place and they get a big boost business-wise as a result of this, I think we’re gonna see a lot more of this. If this crashes and burns and, you know, they choose their one city and there’s problems within that city or the other 19 cities are furious and calling for boycotts on Amazon goods, who knows what could happen here. But if it fails, this may be the last time we see it. If I were a betting man, I would bet we’re gonna see many more projects managed like this in a very public manner.

So that is a wrap on lucky episode number 46 of “The Project.” I don’t know it’s lucky, but I just thought that I’d throw that in. “The Project:” Inside Corporate Location Decisions.

Patience: A sincere thank you to Brett Bayduss for coming in and talking about this report. And again, you can find a link to the report in our show notes, but you can also just type in “Mega Site Selection Deals Winning Big Incentive Packages” into Google and it will magically appear.

Andy: “The Project” is sponsored by DCI. We are the leader in marketing places and have served over 450 different cities, states, regions, and countries. You can learn more about us at

Patience: If you like what you’re hearing on “The Project” or you have suggestions about improving the podcast, please drop us a quick email. My address is [email protected].

Andy: And my email is [email protected]. We would love to hear from you.

Patience: We hope you will keep listening. There are many more projects to come.




Written By

Andy Levine

Andy Levine is Chairman of DCI. Since joining DCI in 1991, he has worked with a broad range of places from “A” (Alabama, Asheville, Australia) to “W” (Wales, Wichita Falls, Wyoming).

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