In Iowa's hunt for Toyota factory, this site leads the pack

In the hunt for a new Toyota manufacturing plant, Iowa officials submitted several potential sites for the Japanese automaker to consider. But many signs point to one eastern Iowa location.

Earlier this month, Toyota and Mazda announced plans for a giant, joint-venture factory, immediately sparking a competition among states hoping to land the $1.6 billion project, 4,000 jobs and satellite suppliers that follow auto plants.

Included in Iowa's pitch was the 1,300-acre Big Cedar Industrial Center in Cedar Rapids. State leaders believe it is large enough to house the auto manufacturing plant and a supplier park. It features shortline rail access that connects with larger rail carriers and is close to a large population base.

Iowa Economic Development Authority Director Debi Durham said those factors are all crucial for an auto assembly plant. She wouldn't characterize how Big Cedar ranks among the sites her department submitted to Toyota. But it is the only one nearing certification as a mega site, a state designation for turnkey sites that are 1,000 acres or larger. 

"It's a great candidate," Durham told The Des Moines Register.

Finding 1,000-acre sites is relatively easy in farm-rich Iowa. But finding big sites ready for development with adequate sewer, rail, water and electric hookups is another story, said Steve Bruere, president of Peoples Company, an agricultural land broker. 

"It's rare," Bruere said. "I’d be shocked if there were more than two or three."

Durham has previously pointed to Big Cedar, located in the city's southwest corner, as a prime spot for an auto assembly plant. 

“I think the best and highest uses for that land from the standpoint of capital investment and employee base would be advanced manufacturing — some kind of auto assembly plant — and warehouse/distribution,” Durham told the Cedar Rapids Gazette last November. “I think that’s what we should be targeting strategically for that area.”

In addition to the Cedar Rapids site, Durham said she submitted to Toyota some smaller sites that have room for adjacent expansion to patch together the requisite 1,000 acres. Sites also must boast Class I rail access and proximity to a population base of about 300,000 people or more, she said, in addition to meeting myriad requirements for power, water and other infrastructure needs.

Those requirements appear to rule out a 2,227-acre site in Whittemore and a 1,125-acre site in Fort Madison featured on Iowa's industrial property listing service because of those cities' smaller population bases.

A Waterloo city official said an advertised 2,000-acre site listed near the city airport lacks rail service and its acreage is broken up into multiple, smaller sites.

"We don’t have anything that would even qualify for a mega site at this point," said Noel Anderson, Waterloo's community planning and development director.

And a 1,349-site on East Lincoln Highway in Ames is bisected by roads in several places, leaving a maximum of about 300 acres of adjoining land, said Dan Culhane, president and CEO of the Ames Chamber of Commerce. 

"I think our site would be rather small by comparison," he said. "I'm not certain that we’d be a viable location for something like that."

Among five sites with 1,000 acres or more on Iowa's online listing, that leaves only Big Cedar as a likely candidate for the Toyota assembly plant. 

“The Cedar Rapids site offers the needed space, utilities, infrastructure and transportation access to serve a large industrial project of this kind," Cedar Rapids City Manager Jeff Pomeranz said in a statement to the Register. 

Big Cedar, which is marketed by Alliant Energy, is expected to earn certification in the coming months as the state's first mega site. The independent, third-party certification process requires that sites undergo certain engineering and environmental tests, making those sites "relatively risk-free" for prospective buyers.

Durham said that process is critical for showcasing turnkey properties to potential manufacturers.  

Iowa has proactively sought to woo auto makers in the last year or so, she said.

"What has kept us out before is really not being ready for development on the land side," she told the Register. "For Iowa to even be on this list is not something a few years ago we could have done."

Des Moines: Toyota plant 'not even on our radar'

Of course, other sites could be assembled by developers and landowners. But a survey of several metro areas within the state show a dearth of massive, shovel-ready locations.

The plant is unlikely to land in Des Moines, said Assistant City Manager Matt Anderson. That's because there are no sites of 1,000 acres or larger available in the capital city.

"It's not even on our radar," Anderson said. 

Officials with the Greater Des Moines Partnership declined to discuss available sites around the metro.

Local officials hailed Microsoft's latest data center project in West Des Moines as a win for future development because of the millions of dollars in new infrastructure going in around the new site.  But Clyde Evans, West Des Moines' community and economic development director, said he doesn't think an auto plant is a good fit for the area. 

"Quite frankly, we really don’t have the workforce to be able to provide enough manpower for a project like that, really anywhere here in the metro," he said. "I'd be surprised if they were looking for a site here. Eastern Iowa's got more of a manufacturing workforce."

Representatives of the Quad Cities Chamber said economic development officials are working to rebuild the area's inventory of industrial sites after securing two recently announced projects: a new $200 million Kraft-Heinz plant and a $73 million Sterilite facility. 

'There's not going to be another site like that'

When Alliant Energy's economic development team began securing development rights for the Big Cedar site, state officials urged them to think big, said Scott Drzycimski, Alliant's director of customer, community and economic development.

Alliant's interest in industrial development lies with spurring usage among high-volume power users who can help offset ongoing increases in energy prices, he said. 

"This is the sort of project that we were thinking about when we did this," he said. "And by doing this, we allow Iowa to be in the conversation on projects like the Toyota-Mazda joint venture. Without this site, it’d be pretty hard to compete for a modern large-scale plant like this."

Drzycimski said the Big Cedar site stands out for its size. He expects some 800 of the site's 1,391 acres can be developed contiguously, which would likely satisfy a carmaker's needs. 

"It is a pretty unique site," he said. "There's not going to be another site like that of this size."

Alliant doesn't own the land outright, but has entered into a five-year agreement with 12 separate landowners, giving the utility the first option of developing the land. 

Starting at $30,000 per acre, Alliant has valued the crop land at more than $41 million, which Drzycimski described as "very competitive."

Big Cedar has ready access to CRANDIC, an Alliant subsidiary that operates a shortline railroad. It also has nearby access to the Eastern Iowa Airport and Interstate 380. And the upcoming certification as a mega site will position the site as move-in ready, with research and data on hand for potential builders. 

"The goal here is that if a prospect comes in, we have a folder and flash drive of everything they need to basically do their first three or four months of due diligence work on that site," Drzycimski said. "So it helps us in the site selection process and hopefully gives us a leg up over other sites."