Senate cuts funding for S.C. World Trade Center

By Scott Miller , Staff Writer

State lawmakers may pull the plug on the financially distraught S.C. World Trade Center, a nonprofit long dependent on state tax dollars to stay afloat.

The trade center is not necessarily dying on the vine, however, as the organization’s leaders look to cut costs, a move that could affect services, boost revenue and ultimately decrease the center’s reliance on state funding, said Paul Roderique, a member of the trade center’s board of directors.

The WTC identifies import and export opportunities for South Carolina businesses and educates high school students on career possibilities in international trade.

“I don’t want to give the impression that the center is able to work without the state funding,” Roderique said, “but I don’t want to give the impression that we will shut down either.”

The state Senate cut the organization’s funding from a budget that had been approved by the House of Representatives.

If the House doesn’t try to reinstate WTC funding, the nonprofit organization may need to survive only one year without state assistance.

The state has given the trade center $297,688 annually since 2005. In 2006, state dollars accounted for more than 58% of the trade center’s total income, according to tax filings. In 2007, the organization began the year $21,000 in the red as it struggled to raise funds and curb rising expenses.

State Sen. Chip Campsen, R-Isle of Palms, said the WTC cut is part of an overall fiscal belt-tightening that is affecting every state agency and many other organizations. The S.C. Board of Economic Advisors lowered state revenue projections by $90 million for the upcoming fiscal year, or about 1.3%. 

“The Senate was left in the predicament of slashing and burning when it comes to the budget,” said Campsen, who has lobbied for WTC funding in the past. “It shouldn’t be viewed as any kind of erosion of support (for the trade center). It’s just a fiscal reality.”

For more on the S.C. World Trade Center, read the May 12 issue of the Charleston Regional Business Journal.

Blackbaud profit up 21% in first quarter

By Daily Journal Staff

Daniel Island-based Blackbaud Inc. tallied a 21% increase in profit during the first quarter of 2008, compared to the same time period last year, the company announced Wednesday.

Net income was $7 million, or 16 cents a share, compared to $5.8 million during the first quarter of 2007, or 13 cents a share. 

Total revenue reached $69.4 million for the quarter ending March 31 behind the release of updated software products designed to help nonprofit groups identify wealth. Blackbaud stock, meanwhile, fell 50 cents a share Thursday morning before rising back up to $23.08. It had closed Wednesday at $22.96.

“We were pleased with this growth and overall financial performance considering the more challenging macro-economic environment in which we are currently operating,” said CEO Marc Chardon.

The figures were in the “upper half of our expectations,” he said.

Most of the company’s growth came from existing customers, rather than first-time Blackbaud customers, with subscription revenue increasing 83% to $8.8 million.

“In fact, approximately half of Blackbaud’s total revenue is now derived from recurring subscription and maintenance-based contracts, which historically have had over a 90% aggregate renewal rate,” said CFO Timothy Williams.

Blackbaud has around 19,000 customers and 1,500 employees.

Housing slowdown tugging at office market

By Molly Parker , Staff Writer

The housing slowdown is starting to nip at the heels of the Charleston region’s office market.

Grubb & Ellis Barkley Fraser’s first-quarter figures released this week show that vacancy rates are on the rise in all markets except downtown Charleston, which has thus far proven immune to the cyclical effects of the market downturn. 

Traditionally, the office market follows the housing lag along a delayed and tempered bell curve. Housing-related professionals such as real estate agents, attorneys and home builders tend to drive up vacancy rates as their leases expire.

“Those people are reducing their footprint, closing up or shopping for a better value,” said Jeremy Willits, senior vice president and principal of office services at Grubb & Ellis.

The average vacancy rate for Daniel Island, downtown, Mount Pleasant, North Charleston and West Ashley during the first three months of 2008 was 17.7%. Rental rates are subsequently dropping as landlords dangle incentives to keep value-conscious tenants renewing their leases. But neither vacancy rates nor rental prices have been impacted dramatically.

“There’s more vacant space than last quarter, but frankly less than we thought there would be,” Willits said. “Fortunately, I think that people felt it coming and pulled in a little bit. There are other markets across the country with vacancies far worse than ours.”

A bright spot in the sluggish environment is the downtown’s vacancy rate of 6.4%, a surprisingly low figure in today’s soft market. Willits said that rate reflects a steady demand for downtown office space even as the inventory has shrunk.

For example, 200,000 square feet in office space recently came off the market as developers renovated the old Cigar Factory on East Bay Street into upscale condominiums. It will still include some office space, but far less than it once did. In recent years, property owners on lower East Bay and Broad streets also have been converting top stories into residential condominiums, finding they can pull a healthier profit in this market leasing to residents instead of businesses.     

The vacancy rates and total square feet of office space by territory for the first quarter break down as follows:

• Downtown: 6.4% vacancy; 1,744,845 square feet.
• Daniel Island: 18.4% vacancy; 1,044,779 square feet.
• Mount Pleasant: 19.8% vacancy; 1,481,410 square feet.
• North Charleston: 22% vacancy; 3,348,120 square feet.
• West Ashley: 19.3%; 1,096,469 square feet. 

Shipping lines launch online information service

By Dan McCue , Staff Writer

A group of international container shipping companies has launched a new online information service to encourage an understanding of the industry.

BB&T named export lender of the year

By Dan McCue , Staff Writer

BB&T Corp. has been named Export Lender of the Year by the U.S. Small Business Administration.

The award is bestowed upon the lender that generates the most SBA-guaranteed international loans in the previous fiscal year and for “steadfast commitment to supporting the growth and expansion of small businesses across the country, even beyond the scope of SBA loans,” according to a written statement from the agency.

Mark Edwards, president of BB&T’s SBA Group, said the company was pleased to be recognized for helping small businesses enter or sustain their activities in the export market. The market has heated up in recent months because of the weakness of the U.S. dollar compared to foreign currencies.

“We have a talented team of professionals who believe in the vital role small businesses play,” he said.

BB&T’s SBA Group supports its community banks with trade-related lending guidance and by supplying products offered by local branches to small- business clients and prospects.

The SBA Group also operates a national SBA lending team, which serves veterinary, dental, franchise child care and hospitality businesses among other industry segments. Its international SBA loan programs include Export Express, Export Working Capital and International Trade.

Shopping Bag

Job of the Week