Axios Raleigh

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April 15, 2024

It's Monday. Welcome to the start of a new week.

⛈️ Weather: High of 88°. Mostly sunny with a chance of storms.

Situational awareness: It's Tax Day — the deadline to file federal income tax returns and extensions to the Internal Revenue Service.

Today's Smart Brevity™️ count is 770 words — a 3-minute read.

1 big thing: Corporate relocation slowdown

A rendering of the Centene campus in University City in Charlotte. Rendering: LS3P

The number of corporate relocations and expansions in North Carolina has slowed in the years since the pandemic, state economic data show.

Why it matters: North Carolina has a reputation for being good for business. That includes its ability to lure companies from outside the state — from Fujifilm Diosynth's $1.2 billion investment announcement last week, to plans from the logistics management company TTX to move its corporate offices to Charlotte.

By the numbers: North Carolina had 111 corporate relocations or expansions in 2023, down from 151 in 2022, 174 in 2021 and 147 in 2020, according to annual reports from the Economic Development Partnership of North Carolina.

Yes, but: The EDPNC's annual figures don't capture the growing number of companies that have canceled expansion plans or reneged on incentive agreements.

  • Raleigh tech startup Bandwidth withdrew from an incentive agreement earlier this year that would have required it to create more than 1,100 local jobs, for instance. Centene canceled plans for a $1 billion regional headquarters in Charlotte in 2022.
  • Using incentives to bring a company to North Carolina has proven challenging at a time when many jobs are still being done remotely.

The big picture: The slowing of corporate relocations might not be a North Carolina problem per se, according to Gerald Cohen, chief economist at the Chapel Hill-based Kenan Institute.

  • "Companies clearly invest less during periods of higher interest rates," Cohen said, adding that other macroeconomic factors, such as inflation, likely weigh on companies' decisions.
  • Employers interested in North Carolina routinely point to factors such as climate, cost of living, airports and tax-friendly policies as significant draws. Those factors haven't changed, Cohen said.

Read more about the corporate relocation decline

2. 🏠 House flipping tumbles

Data: ATTOM; Note: A flip is defined as any transaction between an unrelated buyer and seller within 12 months of a previous transaction; Chart: Axios Visuals

House flipping activity and profits are sinking in Raleigh, per a recent report from real estate data company ATTOM.

Why it matters: A lack of options and affordability are even pushing investors out of this housing market, Axios' Brianna Crane writes.

The big picture: In 2023, house flipping activity nationwide dropped 29.3%, the biggest annual decline since 2008, according to the report.

  • Return on investment, at 27.5%, hasn't been this bad since 2007. The ROI was down from 28.1% in 2022 and 35.7% in 2021.

The intrigue: We're past the house-flip peak of 2021 in Raleigh, but rates are still up 111% from a decade ago, and 40% from 2018, ATTOM data show.

What's next: Buying a fixer-upper is one way for wishful Raleigh homeowners to squeak out a deal. The typical fixer-upper costs $134,748 less than a turnkey home in the area, according to a StorageCafe study.

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3. The Tea: UNC system could add civics requirement

Illustration: Maura Losch/Axios

📜 The UNC system is likely to add a requirement that its students take a class on civics education to graduate. (News & Observer 🔒)

🎓 NC Promise, a program that made tuition cheaper at Western Carolina, Fayetteville State, Elizabeth City State and UNC Pembroke, boosted enrollment at those schools. (WUNC)

  • But other universities, like UNC Asheville and UNC Greensboro, say the low tuition at those schools has come at a cost for their campuses.

🚗 South of the Border, a Mexican-themed attraction along the North and South Carolina border, isn't what it used to be, but that hasn't stopped thousands of travelers from pulling over to visit it. (The Assembly 🔒)

👟 There are 537 runners from North Carolina racing in today's Boston Marathon. (Axios)

A 16-year-old boy died in Durham after being shot last week. (WRAL)

4. Capital Club 16 closes its dining room

The sidewalk dining area in front of Capital Club 16. Photo: Visit Raleigh

Capital Club 16, a restaurant and bar known for its German-American fare, is permanently closing its dining room, the restaurant announced on its social media channels.

Why it matters: For nearly 15 years, Capital Club — located on the bottom floor of the historic Capital Club building on the corner of Salisbury and Martin streets — has been a staple of the downtown Raleigh dining scene.

  • It was a popular haunt of Fayetteville Street workers and capitol politicos alike.

Driving the news: Owned by chef Jake Wolf, Capital Club said it is transitioning to onsite catering, serving at pop-up events and focusing on its food truck, The Wandering Wolf.

Between the lines: Downtown Raleigh's restaurant scene continues to be in flux since the pandemic, with longtime favorites such as Garland and Humble Pie closing.

  • But new kitchens, including Figulina, Chido Taco and Flavor Hills, continue to open downtown.

😺 Zachery learned his cat Percy has an incredibly fast metabolism and now needs to eat twice as much food.

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This newsletter was edited by Jen Ashley and copy edited by Lucia Maher.