March 2026 | Five Points Strategic Advisors

Five Location Factors That Drive ROI

Return on investment in site selection is rarely driven by a single variable. While incentives can materially improve project economics, they operate within a broader framework of location fundamentals that ultimately determine whether a project performs as expected over time. Companies that focus narrowly on incentives often overlook factors that drive operating cost, execution risk, and long-term flexibility.

Labor and Workforce Fundamentals

Labor quality and availability remain foundational. Access to a workforce with the right skills, work ethic, and retention characteristics consistently outweighs modest differences in wage rates or incentive value. Metrics such as turnover, commuting patterns, and competition for talent provide a clearer picture than unemployment rates alone. Locations that invest in workforce development tend to support stronger productivity and lower disruption over time.

Logistics, Costs, and Regulatory Stability

Logistics and market access are equally important. Proximity to customers, suppliers, and transportation infrastructure influences inventory strategy, shipping costs, and service reliability. Incentives tied to logistics improvements can enhance these advantages, but they rarely replace the value of strong underlying access. Companies that model logistics performance realistically tend to make better long-term decisions.

Operating cost stability is another critical driver of ROI. Utility rates, property taxes, and regulatory consistency influence cash flow over the life of a facility. Locations with predictable cost structures reduce financial volatility and improve planning accuracy. Incentives can help mitigate early costs, but long-term stability ultimately drives performance.

Regulatory certainty and community alignment round out the equation. Predictable permitting processes, responsive local leadership, and community support reduce friction and execution risk. Incentives amplify strong locations by accelerating timelines and reducing upfront burden, but they rarely compensate for weak fundamentals. The strongest projects balance incentives with locations that support sustainable, long-term returns.

March 30, 2026

Election Cycles and Incentives

Incentives

Election cycles influence economic development incentives even when programs themselves remain intact. Changes in leadership at the state and local level often bring shifts in emphasis, funding priorities, and approval processes. Companies that understand these dynamics are better positioned to manage timing and expectations.

How Election Cycles Influence Incentive Priorities

In election years or periods of political transition, agencies may prioritize projects that align with broadly supported goals such as job creation, infrastructure investment, and domestic manufacturing. Projects perceived as controversial or misaligned with community priorities may face additional scrutiny. This does not eliminate opportunity, but it does require thoughtful positioning.

Timing Incentives Around Political Transitions

Timing considerations become especially important. Approvals may slow during transitions, while outgoing administrations may seek to finalize projects aligned with their agendas. Companies that monitor political calendars and engage early can often navigate these windows more effectively.

Importantly, incentives are rarely eliminated overnight. Most programs are governed by statute and persist across administrations. What changes is how aggressively they are used and which projects receive priority. Flexibility, awareness, and proactive communication remain key to securing support in evolving political environments.

Election cycles influence incentive priorities even when programs remain intact. Changes in leadership often shift emphasis rather than eliminate support.

Projects aligned with broadly supported goals such as job creation, infrastructure investment, and domestic manufacturing tend to perform well across political cycles.

Awareness and flexibility remain key to navigating these shifts successfully.

March 23, 2026

NMTC Strategy for 2026

Insights

The New Markets Tax Credit remains one of the most effective tools for financing projects in qualifying low-income communities. As 2026 unfolds, competition for allocation remains strong, but well-prepared projects continue to attract interest from Community Development Entities. The projects that succeed are rarely accidental. They are positioned early, clearly articulated, and aligned with both business objectives and community impact goals.

Eligibility and Timing Considerations

In 2026, NMTC strategy begins with eligibility and timing. Understanding census tract qualification, eligible business activities, and the allocation calendar is essential. Projects that wait until capital gaps are fully defined often find that allocation availability is limited or misaligned with construction schedules. Early engagement allows sponsors to evaluate feasibility and build relationships with CDEs before allocations are fully committed.

Aligning NMTC Projects With Community Impact

Successful NMTC projects clearly connect business needs with community benefits. Job creation alone is no longer sufficient. CDEs increasingly look for projects that provide quality employment, support local supply chains, improve access to goods or services, or catalyze additional investment. Sponsors that can document these outcomes tend to differentiate themselves in a competitive allocation environment.

Integrating NMTCs Into the Capital Stack

Capital stack integration is another critical consideration. NMTCs are most effective when coordinated with other incentives, conventional financing, and equity sources. Structuring the transaction early reduces execution risk and allows sponsors to address lender requirements without compressing timelines. Poorly coordinated NMTC transactions often introduce delays that erode value.

For qualifying projects, NMTCs can materially improve feasibility and long-term returns. In 2026, the projects that succeed are those that treat NMTCs as a strategic financing tool rather than a last-minute solution.

March 16, 2026

Site Selection Data That Matters

Insights

Modern site selection is increasingly data driven, but not all data carries equal weight. In 2026, successful site decisions are less about static comparisons and more about understanding how locations perform under real operating conditions. Companies that rely solely on high level tax and wage comparisons often miss indicators that ultimately determine success.

Labor Data That Reveals Real Site Performance

Labor data remains central, but headline unemployment rates are rarely sufficient. Turnover rates, commuting patterns, participation rates, and competing employers provide a more accurate picture of labor availability. In tight labor markets, understanding who is hiring, what they pay, and how quickly they absorb talent can matter more than nominal wage differences. Communities that provide transparent, granular labor data tend to inspire greater confidence.

Infrastructure and Permitting Data That Reduce Risk

Infrastructure data has also become more critical. Utility capacity, power reliability, water availability, and broadband performance are no longer assumed. Manufacturers increasingly require confirmation that infrastructure can scale with future growth. Incentives are often tied to these data points, with public participation triggered by demonstrated need and readiness.

Permitting and regulatory timelines represent another important data category. Published timelines, historical approval durations, and clarity of process reduce uncertainty. Locations that can demonstrate predictable permitting often outperform peers even if their incentive packages appear smaller.

Incentives frequently hinge on the same data companies use for internal decision making. When companies align their analysis with how communities evaluate readiness and impact, negotiations become more efficient. Data transparency supports faster decisions, clearer expectations, and better outcomes for both sides.

March 9, 2026

State Incentive Trends

Incentives

State incentive programs in 2026 continue to evolve toward greater targeting and accountability. Broad, discretionary incentive packages that once applied across industries are increasingly being replaced by programs designed to support specific sectors, outcomes, and regional priorities. For companies evaluating site options, understanding these trends is essential to identifying where public support is strongest and how to position projects competitively.

How State Incentive Programs Are Becoming More Targeted

Manufacturing remains a priority sector in many states, particularly advanced manufacturing, food processing, and supply-chain-related industries. However, incentives are no longer awarded solely based on job counts or capital investment. States are placing greater emphasis on wage levels, skills alignment, automation readiness, and long-term competitiveness. Projects that demonstrate durable economic impact are more likely to receive meaningful support.

Geographic Priorities in State Incentive Programs

Geography also plays a larger role than in the past. Rural communities, secondary metros, and redevelopment areas are receiving disproportionate attention as states attempt to spread economic growth more evenly. Programs supporting site reuse, brownfield redevelopment, and infrastructure upgrades in underutilized areas are expanding. For companies open to a wider range of locations, these trends can unlock additional incentive value.

Workforce alignment continues to influence program design. States are tying incentives more closely to training outcomes, credential attainment, and partnerships with educational institutions. Rather than funding generalized workforce promises, agencies want evidence that training programs will deliver measurable results. Companies that engage local training partners early often strengthen their incentive position.

Accountability and Transparency in Incentives

Another notable trend is increased scrutiny and transparency. Performance tracking, reporting requirements, and compliance enforcement are becoming more standardized. While this increases administrative responsibility, it also provides greater clarity around expectations. Companies that understand these requirements upfront can manage risk more effectively and avoid surprises.

From a strategic perspective, state incentive trends reward preparation and alignment. Projects that clearly connect business objectives with public priorities tend to move through approval processes more smoothly. In 2026, success is less about chasing incentives and more about positioning projects where incentives naturally align with long-term economic goals.

March 2, 2026

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