equipment at the Quonset/Davisville complex.
Name: Michael McMahon
Position: Executive director of the Rhode Island Economic Development
Corporation
Age: 55
Let’s Save Big with Rhode Island Energy Efficiency Programs
Nestled alongside the Blackstone River in Pawtucket, RI, in a historic National Heritage Corridor that…
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Background: McMahon has 32 years of experience in venture capital,
private equity and investment banking. His experience includes: founder and
a partner of RockPort Capital Partners; former senior managing director at Chase
Securities’ Global Oil and Gas Investment Banking Group; former managing director
at Lehman Brothers, Inc.’s Natural Resources Group; and he served as a partner
at Aeneas Group, Inc.
Education: Bachelor’s degree in American civilization at Brown University.
He was a member of the Program for Management Development at Harvard Business
School.
Residence: North Kingstown
PBN: You are not just the head of EDC, but you occupy a cabinet-level position
under the governor. It appears you have more clout than people in your position
had in the past?
McMAHON: You’re absolutely right. The dual responsibility is key, but
it isn’t my clout – it’s the governor’s. And that is what we’re bringing to
bear.
When it comes to economic development it’s key to measure progress from
year to year, administration to administration. How will you keep score?
You will find this answer more often than not, but I really don’t know. But, I can tell you what we are doing. We have a meeting with (Christopher) Kip Bergstrom (executive director of the Economic Policy Council) and that’s what we are going to figure out. There are two dimensions to business: the strategic and the financial. There are two other dimensions in this job: the public policy, and what creates the best and highest good for the most people, and the other is the political reality, and what you can get done. When you look at score keeping, I know how to measure jobs, how to measure quality of jobs and investments in venture capital, but what I’m not sure is how do you factor in political reality and public good. We are going to create a matrix that reflects all four.
Do you expect the Ocean State Job Lot deal to get done at Quonset? Also,
what should we expect to see for dealing with the expansion of existing companies
there and luring new ones?
We absolutely want to get that deal done. But, we’re not going to give the land away. That land belongs to all the people. These are tough negotiators. Everyone asks what is the ‘big audit?’ Well the big audit is a lot of things. In the case of Quonset, to be blunt what we found was there was no chain of command for making decisions, such as leasing, and there was no quantifiable basis for setting a price. The first thing we did was we went out and had some comps prepared based on Class A industrial parks. We’re not talking about (Pease International Tradeport, an industrial park in Portsmouth, N.H.), because that is our goal, but $115,000 to $120,000 is the price for prime industrial land in the industrial park. If Job Lot is willing to pay that we would love to have them as a tenant. Like most negotiations it comes down to a question of price.
The state will try to get more money for the land at Quonset, but how do
you add value to that land?
In the case of Job Lot, it is a double-edged sword, because of the things
we are going to impose on tenants of Quonset – existing tenants and new tenants
– there is the issue of curb appeal. One of the nice things about Job Lot is
that they spend a lot of money coming up with a first-class design, so in terms
of what they are promising to us will be the quality of their facility. We will
clean up the junkyard, but we will require the existing tenants to clean up
their facilities. We are very serious about improving the curb appeal of Quonset.
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