SalemNews.com, Salem, MA

February 6, 2013

Local businesses primed for a rosier 2013

BY ETHAN FORMAN
STAFF WRITER

---- — For George Carey, owner of Finz Seafood and Grill in Salem, 2012 was his best year since he opened in 2001.

And he’s cautiously optimistic that this is a long-term trend, a result of Salem’s having become a dining destination.

Fran Dichner, president of the staffing firm R&L Associates in Beverly, says her company is on track to have its best year since the recession in 2008, as local companies ramp up their work forces.

For Brian Cranney, president of Cranney Companies in Danvers, the economic downturn hit his business hard, as new home construction stalled and there was a dearth of commercial construction. But business has begun to pick up again, and he, too, is optimistic. He predicts business will increase 20 percent this year.

For Somerville developer RCG, 2013 may be one where a $45 million downtown Salem development may go through the permitting process before various city boards.

So what is the economic outlook on the North Shore in 2013?

The economy has been sending mixed signals as of late, so it’s hard to predict. Consumer confidence fell in January according to one study, but was up slightly in another. Housing showed signs of strength; the Massachusetts Association of Realtors announced home sales were up 13 percent in December compared with the same month in 2011. Unemployment rose slightly, by 0.1 percent to 7.9 percent nationally.

But several business owners interviewed say the overall trend appears to be positive.

Carey, who describes himself as both an optimist and a pessimist, admits he’s “wary of 2013,” fearing the payroll tax increase and health care costs could have an impact on those who may want to eat out. Last year, the restaurant’s business was up in all four quarters. Business gradually increased after the crash in 2008.

”We are busier,” Carey said, “and that’s because of the economy.”

By counting the number of guests, business was up about 9 percent last year.

While the economy may have something to do with last year’s success, Salem’s success as a tourist and dining destination has also played a role.

“Salem has become a dining destination and a great place to live, shop and dine,” Carey said.

Pickering Wharf, where Finz is located, is also home to other eateries such as 62 Restaurant, Victoria Station and Capt’s Waterfront Grill & Pub — and that’s a good thing, Carey said.

“Competition is good if you can expand the market,” he explained.

RCG, a developer that owns much of downtown Salem, is another business that is bullish on the city. After sitting on a large downtown parcel to wait out the recession, the company announced plans last week for a $45 million development that could include retail stores, offices, housing and even a hotel.

”We think times are starting to get better,” said Matt Picarsic of RCG. And the company, which also has projects in Brookline, North Andover, Somerville and other areas, says Salem is “one of our better performers.”

When it comes to developing a building, RCG Principal Alex Steinbergh said his company takes a longer view of the economy than just the next year or two or three. He tries to look 20 years ahead.

“I think you start from the macro point of view,” Steinbergh said. “The economy is going to be higher nationally, despite the GDP report.” Steinbergh was talking about a recent report that showed the nation’s gross domestic product shrank slightly in the last quarter of 2012.

One of the positives has been that the Massachusetts economy did not fall as far as the rest of the nation, but the bounceback has also not been as sharp.

“I think there has been steady, positive gain,” Steinbergh said.

A project in Salem, he added, will be able to take advantage of the “multiplier effect” of attractions such as the Peabody Essex Museum, which itself is planning an expansion, and projects such as the new courthouse on Federal Street.

“Our feeling is Salem is the downtown of the North Shore,” Steinbergh said.

Even the North Shore Chamber of Commerce is busier. Vice President Erik Smith said attendance at events has grown at a 15 percent clip, showing there is less uncertainty and more confidence in the business community.

The chamber’s upcoming business expo on March 5 is another marker. Last year at this time, the chamber had booked 55 booths. This year, 80 booths are already spoken for, and just 20 are left.

At Cranney Companies, a heating and plumbing company, business began to pick up in the second quarter of 2012, with increased activity and existing customers “coming back to the table,” said Brian Cranney.

“The phones are a lot more active,” he said. “I would say we are seeing it more on the commercial side. The residential is lagging, but it’s better than it’s been.”

Cranney is also hiring, having added about eight employees, including some who handle customer service and office support, as well as plumbers, electricians and students from vocational schools working on co-op.

R&L Associates handles temporary, temp-to-hire and permanent placements, and “we are really on track to have our best year since the recession,” said Dichner.

Not only is the company placing more people in jobs, “we have plans to expand and increase internal head count,” she said. While she did not want to discuss numbers, she said growth has been “significant.”

R&L has been busy placing people in areas such as administrative work, light industry manufacturing, manufacturing support, receptionist positions, assembly work, computer assembly work and electronics. Some companies that are hiring have a national base, but not all.

“The exciting thing is we are seeing local companies hiring and expanding, too,” Dichner said.

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Staff writer Ethan Forman can be reached at 978-338-2673, by email at eforman@salemnews.com or on Twitter at @DanverSalemNews.