National Business Park:
Economic Development Case Study
Prepared by Cole Greene
University of Maryland Urban Studies and Planning Program
URSP 661
May 18th, 2015
National Business Park: Economic Development Case Study
Background and History
As the United States continues to grapple with the difficult transition from an economy
predicated on manufacturing toward a knowledge-based economy, changes can be
noticed on both a macro and micro scale. While efforts are being made at the federal
and state policy level to “reshore” manufacturing jobs, the growth potential is seen in
“research and development” and other knowledge-intensive sectors1. These trends are
also being noticed at a planning level as jurisdictions look to position themselves to
become the next Silicon Valley. There are a multitude of factors that will ultimately
determine where the next high tech cluster will develop, many of them impossible to
predict. In order to gain a better understand how the future may unfold, it is important to
first understand how the present came to be. This paper will look to further the general
understanding of the modern knowledge-based economy through a case study of a
research and development style industrial park in Anne Arundel County, Maryland.
Figure 1. National Business Park Regional Context Map
National Business Park is a 285 acre site in Anne Arundel County, Maryland located just
northwest of Fort George G. Meade (Fort Meade), 14 miles from Baltimore and 21 miles
from Washington, D.C.. National Business Park is, for all intents and purposes, a
byproduct of Fort Meade and so a discussion of the history of Fort Meade is required to
understand the history of National Business Park.
Fort Meade (then Camp Admiral) opened in 1917 as a training camp, served as an air
defense base during the Cold War. In 1988, the U.S. military created the Base
Realignment and Closure (BRAC) Commission, which is a congressionally authorized
process the Department of Defense (DoD) has used to reorganize its base structure to
1
National Business Park: Economic Development Case Study
more efficiently and effectively2. In 2005, the BRAC Commission slated Fort Meade for
realignment, which resulted in an inflow of DoD agencies and employment. Fort Meade
is now home to a number of defense-related agencies including the National Security
Agency (NSA) and Defense Information Systems Agency (DISA).
Figure 2. National Business Park Local Context Map
The land that National Business Park is located on was purchased in 1986 by Corporate
Office Properties Trust (COPT) and began development as an office park in 1988.
Adjacent land was purchased in 2006 (likely in response to BRAC announcements).
The site is zoned “W-1 Industrial Park” by Anne Arundel County3. The office park
currently has 28 buildings and over 3.2 million square feet of office space.
Location Quotient and Shift Share
Calculating a location quotient (LQ) is a way to measure a particular industry’s
concentration in a particular area compared to a larger geographic area. A shift-share
analysis is a tool used to examine whether employment growth (or decline) is the result
of location advantages, industry trends or economics of the broader region. National
Business Park will be evaluated using both methods. The formula for computing shift
share can be represented as follows:
where:
2
National Business Park: Economic Development Case Study
ei = local employment in industry i
e = total local employment
Ei = larger geographic area employment in industry i
E = total larger geographic area employment
The location quotients for each industry in both 2008 and 2012 are shown in Table 1
below.
Table 1. National Business Park Location Quotients1
Industry
Manufacturing
Wholesale trade
Finance and insurance
Real estate and rental and leasing
2008
Employment
2012
Employment
2008
LQ
2012
LQ
1
85
0
31
279
160
4
55
0.00
0.54
0.00
0.29
0.91
0.64
0.01
0.30
3784
3.03
2.78
1
23
13
73
90
4482
1.45
0.07
0.20
0.58
0.00
0.01
0.03
0.05
0.53
0.20
Professional and technical services
2227
Management of companies and
enterprises
100
Administrative and waste services
35
Health care and social assistance
29
Accommodation and food services
46
Public administration
0
Total
2554
1
State of Maryland used as larger geographic area
Sources: Maryland Quarterly Census of Employment and Wages, Bureau of Labor and Statistics
The “professional and technical services” industry is the predominant industry within
National Business Park, with 87% of the total employment in 2008 and 84% of the total
employment in 2012. It is important to note that employment data at as small a scale as
a single business park may be misleading. Industry codes are self reported and do not
necessarily depict the exact nature of economic activities occurring. That being said,
National Business Park clearly has a strong presence in the knowledge-based economy.
A shift share analysis over the same period (2008-2012) will determine, for each
industry, whether growth occurred due to regional trends, industry trends, or locational
advantages. Table 2 below presents the results of the shift-share analysis.
While Maryland’s total employment declined over the time period, the “professional
scientific and technical services” industry showed growth in the State. This growth,
however, only accounts for 102 new “professional scientific and technical” jobs within
National Business Park, while locational advantages accounted for 1,478 new jobs. The
locational advantages that National Business Park holds are undoubtedly associated
with its proximity to Fort Meade. Maryland Quarterly Census of Employment and Wages
(QCEW) data indicates that tenants of the business park are largely private defense
contractors though it is likely that there are government tenants mixed in as well.
3
National Business Park: Economic Development Case Study
Table 1. Shift Share Analysis of National Business Park
Change
from
industry's
growth in
MD
Change
attributed
to district
Total
Change
2008 District
Employment
2012 District
Employment
Percent
Change
Change
from MD
total
Economy
1
85
279
160
27800%
88%
0
-1
0
-9
278
85
278
75
Finance and insurance
Real estate and rental and leasing
Professional and technical services
Management of companies and
enterprises
Administrative and waste services
Health care and social assistance
Accommodation and food services
Public administration
0
31
2227
4
55
3784
N/A
77%
70%
0
0
-23
0
-1
102
N/A
25
1478
4
24
1557
100
35
29
46
0
1
23
13
73
90
-99%
-34%
-55%
59%
N/A
-1
0
0
0
0
16
0
2
-1
0
-114
-12
-18
28
N/A
-99
-12
-16
27
90
Total
2554
4482
75%
-26
109
1752
1928
Industry
Manufacturing
Wholesale trade
Sources: Maryland Quarterly Census of Employment and Wages, Bureau of Labor and Statistics
Successes and Shortcomings
National Business Park is an unequivocal success in terms of providing employment and employment growth. However, this success
is likely a by-product of government-induced demand, and thus not easily replicable without a particular set of circumstances. There
are several lessons that can be learned. The first lesson is that government contracts can spur private sector industry clust ering.
While there is only one Fort Meade, other jurisdictions can look to use the general strategy of consolidating government agencies (as
was the case in BRAC) to induce the creation of private sector clusters of firms with government contracts. The second lesson is that
a properly educated work force is necessarily a prerequisite for the formation of any knowledge-based industry cluster. According to
Education Week, Maryland has the third best public education system of any state in the U.S.
4
National Business Park: Economic Development Case Study
The cyber-security industry is seen as a major area for potential growth within both the
national and regional economies. In 2013, President Barack Obama signed Executive
Order 13636: “Improving Critical Infrastructure Cybersecurity” 5. The role of the federal
government in the cybersecurity industry is and will remain instrumental, giving the
broader region around Fort Meade potential to capitalize on an industry primed for future
growth.
But while the seclusion and secrecy associated with the National Business Park may be
beneficial to its role with the DoD, but it hampers the potential for knowledge spillover
effects throughout the region. Diffusion of technology and knowledge is critical to forming
competitive clusters in knowledge-intensive industries such as cyber-security. If the
region is committed to facilitating the growth of this kind of cluster, there must be public
sector involvement in diffusing knowledge and technology where possible. This can be
accomplished through public and private learning institutions. More on this will be
discussed in the following section.
Recommendations for the Future
1. Government and Educational institutions should continue to coordinate with both
public and private leaders in cyber-security.
The region currently boasts strong institutional infrastructure in the cyber-security
industry with Federal anchors such as the NSA, the National Institute of Technology and
Standards (NIST), DISA, the Intelligence Advanced Research Projects Activity (IARPA)
as well as the National Cybersecurity Center of Excellence (NCCOE) in Rockville, MD.
The area also boasts cybersecurity research leaders such as the University of Maryland
Baltimore County (Cryptology, Network Security, Intrusion Detection, Quantum
Cryptography, Electronic Commerce, Secure Software Agents, Multicast Security, Voting
Systems, Health Care Information Systems), Johns Hopkins (Networking, Wireless,
Systems Evaluation, Medical Privacy and Electronic Voting, Emergency Health
Preparedness, Bio-terrorism), University of Maryland College Park (Network Security,
Mobile and Sensor Networks, Hybrid Communication Networks, MEMS Sensor Design
and Fabrication, Nanotechnology, System Engineering Methodologies, Supply Chain
Management, Economics of Information Security) and Morgan State University
(Bioinformatics).6
2.
Local jurisdictions should seek to meet the security and facility needs of private firms
with appropriate zoning, infrastructure improvements.
Firms specializing in cybersecurity and other data-intensive industries will undoubtedly
require fast and reliable internet access as well as high security buildings. Local and
regional planning organizations should look to collaborate with leading cyber-security
firms and real estate developers such as COPT to determine how much space and what
types of infrastructure improvements the industry will need moving forward. Connectivity
is the key to knowledge spillover and agglomeration economies. While technology
improvements have allowed for more telecommuting and non face-to-face meetings,
physical accessibility is still the key to knowledge spillover. Transportation infrastructure
will be a key component of this as well as the facilitation of social network expansion.
5
National Business Park: Economic Development Case Study
3. Economic development organizations should encourage commercialization of
cybersecurity technologies originally developed for the public sector. Diversifying the
customer market will ensure the continued growth of the industry locally.
The cybersecurity industry in this region is currently dominated by private firms with DoD
contracts or connections to DoD contracts. Maryland’s top IT defense contractors
include Boeing, Booz Allen Hamilton, CACI International, Computer Sciences
Corporation, General Dynamics Corporation, Honeywell International, IBM, L3
Communications, Lockheed Martin Corporation, MITRE, Northrop Grumman Corporation
and SAIC6. Economic development organizations can act as a liaison between private
companies and local entrepreneurs to facilitate innovation. The effectiveness of
incubator style projects such as the Chesapeake Innovation Center (CIC) in Anne
Arundel County should be explored.
References
1
http://www.oecd.org/sti/sci-tech/1913021.pdf
http://www.defense.gov/brac/
3
http://www.amlegal.com/nxt/gateway.dll/Maryland/annearundelco_md/article18zoning?f
=templates$fn=default.htm$3.0$vid=amlegal:annearundelco_md
4
http://www.edweek.org/ew/qc/2015/2015-state-report-cards-map.html?intc=EW-QC15LFTNAV
5
https://www.whitehouse.gov/issues/foreign-policy/cybersecurity/eo-13636
6
http://business.maryland.gov/Documents/ResearchDocument/CybermarylandReport.pdf
2
6