Wilmington: Business Unusual
Wilmington's business leaders' unique approach results in a boom in business start-ups and community development

TWENTY-FIVE YEARS AGO, Dave Phillips helped New York-based Citibank turn the ATM into a worldwide acronym. A few years later, he began marketing Citibank's credit cards on a national scale and became respected in the industry as the father of the modern-day card. Five years ago, he took his own company, Chicago-based CCC Information Services Inc., public. Today, he and his wife, Kuthann, live on the Intracoastal Waterway in Wilmington and he teaches business-marketing courses at UNC Wilmington.
In the early '90s, when the Phillipses started looking for places to get them out of the big-city rat race, their search settled on Wilmington. They built a home in the gated community of Landfall, more than 2,000 acres of million-dollar homes just minutes from Wrightsville Beach. Their lighthouse-shaped guesthouse is the envy of many a boater cruising the waterway. "We chose this place because of the quality of life here — it's on the coast, it's more than a retirement community, it has a respected university and it has an airport, so we can travel when we want," said Phillips.
The Phillips' story has become typical in this fast-growing haven of southeastern North Carolina. In the past 10 years, as overall population growth here has reached 33%, much of the business growth has come from people figuring out they can conduct business from this corner of the world just as well as from any other. As a result, Wilmington and New Hanover County are home to a rich mix of people who gained their knowledge and experience on the world stage and are now sharing that with a community remarkable for its beach environment, historic downtown and cultural nightlife.
" This is a simpler place to do business. It has been very easy to attract people because of the environment here," says Fred Sancilio, founder and CEO of Wilmington-based aaiPharma Inc., whose ability to think outside the box has led to everything from innovative treatments for cancer to a company day-care center.
The day-care center came about after one of Sancilio's scientists had to leave during a meeting to pick up her child. "It was like if she didn't get there by a certain rime, she'd be tied at the stake," Sancilio says. "It just seemed odd that there was no flexibility for her/' Company lawyers told him getting into the day-care business would be a disaster. "Everybody said it couldn't be done, but then again, we hear that in this business all the time," says Sancilio, whose company is increasingly marketing its own drugs in addition to doing contract research for other companies. "We are of the mindset here that there is a way to do anything. It's just that it may not have been thought of yet."
People such as Sancilio are helping to drive Wilmington forward. Though their ideas and vision have been met with skepticism from longtime residents, they keep pushing and trying different ways to get their point across — whether they are proposing structural changes to the local hospital, perceived as taking money away from nurses, or a mixed-use community that goes against longtime zoning laws set up to keep neighborhoods away from industries.
" When the regulations were passed, they made sense. They didn't want people having to live next to factories or schools next to slaughter houses," says Joel Tomaselli, the vision behind Lumi-na Station, a wooded retail center near the drawbridge to Wrightsville Beach and a critic of government policies that stifle responsible developers. "We need to be more concerned now with the space we have, the natural environment we're losing and overcrowded roads."
Major change is happening. Just outside New Hanover County, west of the Cape Fear River, Stamford, Conn.-based International Paper Co. is turning 10,000 acres into a new Brunswick County town that will be developed with the mixed-use concept in mind. More than 2,000 acres will remain undeveloped as green space. When complete, it could house nearly 30,000 residents. "This is going to be an example of responsible development," says Dan Weeks of Charlotte-based Haden-Stanziale PA, architects for the site. ''If this land had gone piecemeal, who knows how it would end up. By changing zoning to allow an overall concept Brunswick has something to get excited about."
Another such proposal going through the permitting process is Mayfaire, a 394-acre community that will be built in the rapidly developing Landfall area. The vision for the former horse farm calls for multi- and single-family housing and includes parks, sidewalks and alleys. The developers, the Zimmer family in Wilmington and H.I. Brody of Greenville, are courting major retail tenants, restaurants and other businesses. "It's bringing in a lot of big-city thinking," says Brody, whose background includes owning several department stores in the Greenville area. "When it's fully developed, the benefits to Wilmington and New Hanover County will be incredible."
Once complete, the community of Mayfaire will likely be Wilmington's largest taxpayer, surpassing big industry names with a local presence, like Corning, N.Y.-based Corning Inc. and Fairfieid, Conn.-based General Electric, according to economist Claude Farrell of UNCW. "What's happening there is extremely important and will keep the growth here from being a strain on the infrastructure," says Farrell, who has been analyzing the region's growth for the past 20 years. "We know the quality of life here will continue to attract more people. Mixed-use communities like Mayfaire will help us handle it."
Small-business boom
A relaxing vacation of sandals, shorts and golf on Landfall's jack Nicklaus-designed course would make anyone want to move here, according to David Swain, responsible for much of the upscale development around Landfall and Wrightsville Beach. "People vacation here, and they see quite quickly what it has to offer," says Swain, who owns The Forum, a collection OF retail shops and restaurants, and the adjacent Renaissance Park, an evolving high-end business park that houses offices of New York-based Morgan Stanley and Merrill Lynch and is the headquarters for high-tech start-up TalkingNets Inc. "In Landfall alone, you've got people who could live anywhere in the world — and many have — and they chose to live here."
That's how high-tech companies such as TalkingNets and ePIus Technology Inc. have come to call Wilmington home. "We've carved a niche for ourselves here," says ePIus president David Rose, who began the company more than 10 years ago as a MicroAge franchise just as personal computers were becoming part of the American mindset. He kept its headquarters in Wilmington despite growing a client base from Florida to California and opening offices in Charlotte and Greensboro.
Two years ago, the company reported sales of $26.5 million in the Carolinas alone and became part of ePIus Inc., a publicly traded company based in Herndon, Va., though Rose kept the subsidiary's headquarters in Wilmington. "We've been able to recruit from the cream of the crop because of our location," says Rose, who has 82 employees and numerous subcontractors. "Wilmington has a seasoned work force compared to other markets this size."
What makes the Wilmington area equally impressive is its ability to attract people of varying means and diverse backgrounds. "There's a great mix of people in this community' Rose says. "Having the beach here helps. And downtown. And the movie studio brings in a caliber of professionals who might not otherwise be on this coast."
Throughout the past 1 7 years, the local film industry has survived bankruptcies and the changing moods of actors, directors and producers. The legacy that is "Wilmywood" started with Orton Plantation in 1983, when "Firestarter" director Dino De Laurentiis and producer Frank Capra jr. saw the plantation on the cover of a magazine and decided to use it for the film.
De Laurentiis then opened the N.C. Film Studio on 32 acres just outside downtown. In the years since, the studio has changed owners twice and the region has been the stage for successful movies ranging from "Blue Velvet" and "Lolita" to "Cape Fear" and "I Know What You Did Last Summer." The "Matlock" crew regularly set up on the historic downtown streets, and most recently, the successful VVB teen drama "Dawson's Creek' signed on tor its fifth season of local filming. That series alone has pumped nearly $100 million into the local economy.
Recent successes can be attributed to the return of Frank Capra Jr., who was hired by the studio's newest owner, New York-based HUE Screen Gems. The son of the legendary director of "It's a Wonderful Life" has made numerous cross-country tripes to rub elbows with filmmakers and has pushed state legislators to create tax packages that better entice filmmakers to go on location.
Because of the film industry, the tourism industry and the recreational needs of the local population, the service industry continues to carry the economy, which has fluctuated in the past five years from double-digit growth to a post-Hurricane Floyd low of 3.7% to a projection of 6% for this year. Sales of commercial buildings have consistently climbed over the past year, culminating xvith a 107% reported rise earlier this summer compared to the same time a year ago, according to statistics from Wilmington-based Ingram, McKenzie and Associates, a real-estate appraisal firm.
" The barriers for starting your own business don't exist here," says Hansen Matthews of Maus, Warwick, Matthews and Co., a Wilmington-based commerdal-real-estate company. "There are scores of businesses here where people of moderate means can get started."
In December, the Wilmington metro area was ranked seventh nationally in an Inc. magazine report on best places for starting and growing a business. In a five-year span from 199.) to 1998, the number of small businesses — those with fewer than 100 employees — rose from 5,400 to 7,541.
" I think the success of businesses here shows the caliber of people who live and work in this community," says Connie Majure, president and CEO of the Greater Wilmington Chamber of Commerce. "We've known for a long time what a great place this is. Now, the numbers are starting to show that as well."
Smart development
The igniter of change was the extension of Interstate 40 to the coast in 1990. With it came the world beyond the hog farms and tobacco fields of Duplin and Sampson counties. Suddenly, Wilmington had easy access to Raleigh, 1-95 and the northeastern United States.
Unfortunately, the local community had clone little planning for the other side of that coin: The access those areas would have to Wilmington, lust as the population skyrocketed, demand for cultural offerings, dining choices and family activities has risen as well. As a result, at least 12 theater-production companies thrive at any given time. In the past 10 years, the number of restaurants in New Hanover County has climbed nearly 70% to 620.
" Once the momentum gets going, as has happened here, others rush to the area," says Swain, whose tenants at The Forum range from a French cafe to an Italian shoe store. "When people see things start to happen, they want to be part of it."
In the past five years, local officials have made some major strides in securing state funding to help the roads keep up. Smith Creek Parkway, an eventual direct route to Wrightsville Beach, will make it possible to avoid Wilmington streets heavy with traffic lights. The project is finally on the Department of Transportation's budget for completion over the next four years. Though 75% of the road is complete, the most difficult stretch, a four-lane path through wetlands and downtown communities, began in late summer. The city's major thoroughfares have been expanded to at least six lanes. And the proposed U.S. 17 Bypass around Wilmington is finally becoming a reality as work crews clear land around 1-40 in preparation. Eventually, the road is expected to be a boon for the shipping industry, giving 18-wheelers and large-bed trucks easier access to the Wilmington port.
The biggest transportation prize for the state ports has been state and federal approval for a $377 million project to deepen and widen the Cape Fear River. The project, which already has received $60 million in funding, wilt enable ships to carry heavier loads and enter the port at any time. Currently, its major customers, Taiwan-based Yang Ming and Hanjin, which flies the Korean flag, must plan their schedules around the tide to avoid going aground.
" The navigation improvements will produce payoffs for North Carolina well into the next century with additional jobs, income, sales and tax revenues," says Erik Stromberg, executive director of the N.C. Ports Authority, which oversees ports in Wilmington and Morehead City as well as inland terminals in Charlotte and Greensboro. Statewide, more than 80,000 jobs and $300 million in annual tax revenues are generated by activities at the ports, says Karen Fox, the ports authority's public-affairs director.
Health care's future
One industry that has felt the weight of growth more than any other is health care. Just as the Wilmington area has become a retirement hot spot, life expectancy has reached an all-time high — 75 for men, 82 for women, according to the U.S. Census Bureau.
" The population used to be looked at as an age pyramid; now it's an age square," says Bill Atkinson, president and CEO of New Hanover Health Network, which includes the 4,000-employee New Hanover Regional Medical Center, Cape Fear Memorial Hospital near Wrightsville Beach, Render Memorial Hospital and the county ambulatory service.
More people need health care and they need it for a longer time. As a result, hospitals across the country are struggling to keep up with the increase in patient numbers and the rapidly emerging technology that has caused the life-expectancy rate to rise.
In the past year, Wilmington's New Hanover Regional Medical Center has completed a $66 million expansion that included the addition of a 26-bed pediatrics unit, the three-story Zimmer Cancer Center and an emergency department nearly double the size of the previous one. At the same time, the hospital, 52% of whose patients are on Medicare, has had to deal with more than $46 million in Medicare reductions.
" Congress takes all the glory for promising health care to people, then they don't follow through on that promise and pay their bill," Atkinson says. "There is something wrong when the most powerful nation in the world has 44 million people, half of whom are kids, uninsured."
Though a public hospital. New Hanover gets no tax dollars. Its impact on southeastern North Carolina's business community is immeasurable. In addition to its strong employee base, more than 400 physicians use its facilities and its annual operating expenses are slightly more than $300 million.
Atkinson, too, has been thinking outside the box in an effort to find solutions to health-care problems, including a shortage of nurses that has caused the hospital to close beds. The health network is paying Cape Fear Community College $50,000 to support its nursing program.
" What we've found in our research is that there's not a shortage of people who want to be nurses, there's a shortage of instructors," says Atkinson. Community-college instructors are paid based on the number of students in their classes, which puts nursing instructors at a disadvantage in salary. ''Because of the one-on-one approach in the program, the instructor-to-student ratio is much smaller than in other classes like truck driving," says Scott Whisnant, the hospital's media manager. "This extra funding will hopefully provide some incentive."
Older Wilmington newcomers are glad to hear visionaries such as Atkinson talk about the future and see other leaders at work.
" People move here and they don't want to go dormant," says Swain. "They're getting involved in civic organizations, the arts, government. They're intelligent with a world of experience and they want to make sure the quality of life that brought them here stays."
Pam Sheppard Sander is a Wilmington-based freelance writer.