🔒Daum to depart DECD following year of significant economic development investment, new branding campaign, some corporate relocations

Alexandra Daum kicked off 2023 as the state’s new community and economic development commissioner.

The Department of Economic and Community Development, Daum said, tallied several wins this year, including a re-imagined state branding campaign, a boost in tourism, tens of millions of dollars approved for new economic development projects and the expansion of numerous businesses.

But the state also encountered some headwinds, including several high-profile employers that announced plans to leave Connecticut or reduce their presence here.

Daum ended the year with perhaps her biggest surprise — she announced last month she will be leaving her post in early 2024 to take on a new full-time role at Yale University.

She will start her new job managing a portion of Yale’s real estate portfolio in February. Her DECD commissioner replacement will be former technology investor Daniel H. O’Keefe, who was named the state’s first chief innovations officer in July.

O’Keefe reported to Daum.

DECD investment

In a recent interview, Daum said she looks back on 2023 and sees many success stories, namely in projects that will soon be launched with state-funding support.

For example, the Connecticut Communities Challenge Grant program was created in 2021 to invest millions of dollars in transit-oriented development and other housing projects.

Through November, three funding rounds have occurred, with $99.9 million allocated to 27 cities and towns. Those funds will leverage more than $270 million in private investment, DECD said.

The program has a goal of creating 3,000 jobs, with 50% of the funding going to distressed municipalities. Daum said it’s difficult to gauge whether the 3,000-jobs target has been met, as many projects haven’t yet been completed.

Of the 27 municipalities approved for grants, 17 awards have gone to distressed communities, DECD said.

The most recent $23 million funding round was announced in August. Awards included nearly $4.5 million to develop a transit-oriented, mixed-use village adjacent to the Bethel Train Station in Bethel. A 100-unit mixed-income apartment redevelopment in New Britain — known as The Strand — was approved for $4 million in funding, while a project to redevelop the Day of New London’s former newspaper headquarters into mixed-use residential space got a $1.2 million grant.

Meantime, in September the Lamont administration announced that 21 municipalities and nonprofits would share more than $101 million from the Community Investment Fund — a DECD program created in 2020 to award up to $875 million for projects in distressed communities over a five-year period.

The program since last year has allocated nearly $276 million through three funding rounds.

Notable projects funded in the most recent grant period included $22 million for the demolition of the decommissioned PSEG coal-fired power plant in Bridgeport to remove a blight and reconnect the city to its harbor. Real Art Ways was allocated $9 million to expand its Hartford headquarters and entertainment offerings.

“We were very targeted and very deliberate about where the money goes,” Daum said. “We focused on … making sure our dollars were going toward things that will help the state.”

The Small Business Boost Fund, another DECD initiative that launched in 2022, is on track to deploy its $150 million — half from the state, half from private lenders — over a five-year period, Daum said. The program offers small-scale entrepreneurs low-interest loans up to $500,000.

Daum said that as of October, more than 60% of the 362 loans totaling $46 million have gone to priority groups like women-, minority- or veteran-owned small businesses.

Corporate losses

The headlines weren’t all great on the economic development front this year.

Several high-profile employers announced plans to leave Connecticut or reduce their presence here.

Telecommunications giant Frontier announced in September it will relocate its headquarters from Norwalk to Dallas. Frontier said it will maintain a presence in Connecticut, but chose Dallas for its central U.S. location and because it’s a “business friendly” city.

In January, Danish toy maker LEGO Group said it planned to relocate its North American headquarters and about 740 jobs from Enfield to Boston by 2026, in search of a wider talent pool.

In that same month, Campbell Soup Co. announced it was relocating the Norwalk headquarters of its Pepperidge Farm subsidiary to New Jersey.

Daum said specific corporate relocations both in and out of the state are just one small part of the larger jobs picture.

“At DECD we focus more on the net number of jobs and businesses in the state as indicators of our economic health,” she said. “We continue to see encouraging signs on these fronts, including the fact we’ve gained 25,600 jobs this year, private sector employment is now at an all-time high, and we’ve added over 21,000 firms since 2020.”

A bright spot came in mid-November when South Korea-based aerospace and defense manufacturer Hanwha Aerospace announced it will establish its international engine business headquarters in Cheshire.

Other Connecticut companies announced expansion plans in the state this year. Overall, Connecticut’s 3.5% unemployment rate is below the U.S.’ 3.9% jobless rate.

Still, the state’s workforce shortage remains an issue, with Connecticut employers reporting 103,000 open positions in September, which equates to five available jobs for every three people who are unemployed.

CT’s new brand

Tourism was one of Daum’s key focus areas in 2023.

DECD this year added a new chief marketing officer position — held by former Lamont administration communications director Anthony Anthony — to help those efforts.

Tourism activity in Connecticut has rebounded from the COVID-19-imposed crash of 2020.

State officials and tourism operators said the declining threat of the pandemic has boosted the industry. So has a renewed focus by the state on outreach and marketing, with increased funding and sharpened tactics.

According to research by Tourism Economics, the first half of 2023 saw 31.8 million visits to Connecticut tourism destinations, up nearly 3% year-over-year.

Connecticut’s tourism website, CTvisit.com, logged 7.3 million visits during that same time period, up 44% from a year ago, Daum said.

A new $1.5 million statewide branding campaign, “Make it Here,” was launched in September to hammer home Connecticut’s best qualities.

The campaign is using advertising and digital media to highlight Connecticut’s position as an innovative hub of arts, sciences and manufacturing, as well as a great place to live, work and enjoy life.

Advertisements began on Nov. 1, in traditional and digital media, streaming services, billboards and placements in travel hubs like Bradley International Airport and the Metro-North Railroad.

“It was more of an umbrella campaign to encourage people to visit, but also to live here, work here, start a business here,” Daum said.

The campaign, she added, attracted national media attention that highlighted New Haven as a top place to live, and towns like Mystic as top tourist destinations.