Space Florida shrugs off loss of Terran Orbital factory
WASHINGTON — Terran Orbital’s decision not to build a large satellite factory in Florida is only a minor setback for the state’s efforts to grow the space industry’s presence in the state and to expand beyond launch, according to one official.
In a recent call with reporters, Frank DiBello, president and chief executive of Space Florida, the state space development agency, said he was seeing a growing backlog of potential aerospace investment opportunities for his organization.
“Space Florida is busy,” he said, stating that the organization was evaluating about 150 projects that it has qualified through a due-diligence process, three times as many as were under consideration before the pandemic. “It is a reflection of both the industry growth as well as the capital that is flowing into the marketplace.”
Not all those opportunities have panned out. In September 2021, Terran Orbital announced it would build a large satellite factory adjacent to Space Florida’s Launch and Landing Facility, the former Shuttle Landing Facility runway at the Kennedy Space Center. Space Florida helped arrange financing for the project, which Terran Orbital said would create 2,100 jobs by the end of 2025.
However, a little more than a year later, Terran Orbital announced it was no longer pursuing the Florida factory. It said it would instead expand existing facilities in California that it argued could be completed faster, enabling it to ramp up production of satellite buses it is providing to Lockheed Martin for a Space Development Agency (SDA) contract.
“I fully understand that they had incredible schedule pressures” because of their SDA work, DiBello said. “They had no choice but to expand their facilities in California in order to be able to get to market and get to the delivery requirements they have under that contract.” He added Space Florida remained in touch with Terran Orbital about future projects the company might undertake in the state.
DiBello said the property that had been planned for the Terran Orbital factory was “coveted” by others. “We will have no trouble finding uses for it, and in fact we have several companies that we’re actively working with now to locate out at the Launch and Landing Facility.”
He declined to discuss specifics about the companies interested in using that property. “They’ll be involved in space activity and, we hope, enablers for a lot of the space economy,” he said. Space Florida has a specific interest in what he described as “next-generation space platform companies” that would help other space companies. “That’s what we want to see happening: broadening our base of opportunity for other companies to get to low Earth orbit and to bring value back.”
He said that, as the number of opportunities grows, Space Florida is making its due-diligence efforts more rigorous, citing the “irrational exuberance” associated with the wave of companies going public through mergers with special purpose acquisition corporations (SPACs) since early 2021. Many of those companies have faltered since going public as they fell short of ambitious growth projections. That includes Terran Orbital, whose stock has fallen from about $10 per share when its SPAC merger closed in March 2022 to less than $2 per share now.
“Taking a company public is a serious initiative, and then you have to perform and meet your numbers,” DiBello said. “What we are seeing is a more cautious due diligence over a longer evaluation period to get to financing, as well as more reasonable approaches to valuations.”
He said that, despite the problems with SPACs, there was still plenty of capital available for space companies, particularly those that can demonstrate “real revenues and real sales” in the market. “I expect the capital markets, which are flush, will continue to draw a lot of interest. It’s just going to be conservative and take a longer time.”