By Jennifer E-Commerce • Logistics • New Developments 0 Comments

VISALIA INDUSTRIAL PARK UNDERGOING REMARKABLE GROWTH

Robert Rodriguez, region manager for West Coast distribution for Hilti, Inc., a European maker of industrial tools, stands in one of two distribution centers his company has in the Visalia Industrial Park, along with a separate repair building. He said the park is a sweet spot for transporting goods within a day across California and to much of Arizona and Nevada. Photo by David Castellon

Published On March 14, 2018 – 1:50 PM

With work underway to build Amazon and Ulta fulfillment centers in south Fresno, and plans to convert a former tire plant in Hanford into an electric car plant, three new buildings totaling more than 400,000 square feet in the Visalia Industrial Park didn’t grab a lot of attention from the general public.

But among people involved in manufacturing, warehousing and other businesses needing large spaces, the buildings commissioned by Diversified Development Group in Fresno, which has been developing and leasing commercial structures here for more than two decades, has drawn a lot of attention.

So much so that DDG, which built the buildings on spec, had two of the buildings leased or were negotiating leases on them with multiple tenants before construction was done. DDG Vice President Marcus Pignotti said he believes a lease deal for a single business to entirely occupy the 166,000-square foot third building is close at hand.

With that kind of interest among businesses to get into the Visalia Industrial Park, “That explains why we’re in site plan review for our next four buildings,” that would comprise another 689,000 square feet of combined industrial space on a separate, 33-acre parcel in the Industrial Park in northwest Visalia, Pignotti said.

Beyond that, DDG purchased last year another 150 acres of undeveloped land in the Industrial Park, where the company plans to build up to three million more square feet of industrial space, which could include a single, 1 million-square foot building, he said.

DDG isn’t the only business looking to develop or expand in the Visalia Industrial Park.

From 2016-2017, Visalia issued permits for more than 804,000 square feet of new buildings in the Industrial Park. In fact, in terms of new industrial development and expansions, experts say the Visalia Industrial Park and the neighboring Visalia Business Research Park are some the most active commercial real estate spots in the Valley after south Fresno.

Beside what DDG has in store, the former Heller Performance Polymers plant on Doe Avenue has been demolished, the ground leveled and now the owners are planning to build two 400,000 and more than 300,000 square-foot buildings there once they line up tenants, said Marty Zeeb, a Visalia commercial real estate broker.

In addition, UPS, which has had a distribution center in the Industrial Park for decades, has gotten so busy shipping packages that it recently purchased 58 acres, with plans to build a second state-of-the-art distribution center in the Industrial Park, while Golden State Overnight — a regional shipping service — has outgrown its facility, and is building a new, nearly 63,000-square-foot-facility.

Meanwhile, Perfection Pet Food — a division of Goshen’s Western Milling — is building a nearly 152,000-square-foot office and distribution center, while Hydrite Chemical Co. recently completed a more than $16.1 million expansion and capital improvement project.

That doesn’t include the 100-acre Research Park, where a 94-room Marriott Residence Inn and an Arco AM/PM convenience store and gas station are being built near the Fresno Pacific University satellite campus and two car dealerships already on the mostly vacant set of parcels.

It’s a far cry from the area’s modest beginnings in the mid 1960s, when businessmen Al Blain, Dana Clancy and Lloyd Pendergraft spearheaded an effort to widen Visalia’s mostly ag-based economy by creating sites zoned for various sorts of industrial businesses and purchased “not the best farmland” from Florence Doe, recalled Harry Tow, who was city manager at the time.

“They thought we needed an industrial park where industry didn’t have to think about putting in utilities and streets. It was done for them,” he said, adding that Blain, Clancy and Pendergraft had Visalia’s best interests at heart — so much so that as far as Tow knows, Blain, Clancy ad Pendergraft “didn’t make a dime off it.”

In the five decades or so since, the Business Park has grown from a handful of businesses to 379 — from Far West Distributors, which employs just five people, to VF Outdoor, a clothing distribution center employing about 1,200.

It isn’t just your usual industrial park with one big building or several comparable buildings and warehouses occupying one parcel. Instead, the Visalia Industrial Park is like a city in a city comprised of more than 16.6 million square feet of buildings occupying 381 acres spread over multiple blocks, with different buildings constructed in their own, particular styles.

Based on 2015 U.S. Census estimates, the latest figure Visalia officials could provide, 6,932 people worked at the Industrial Park, a third of them Visalia residents. Considering the expansions and new developments since then, the number likely has grown.

Before the recession, new developments were active in the Industrial Park but lulled in the years the economy spiraled, Zeeb said. But as that period passed and the economy improved, developers started actively planning again in 2013 and 2014, and over the last two or three years a lot construction and permitting has followed, he said.

The Industrial Park has several tenants with national and international reach, mostly involved in manufacturing, warehousing and distribution, including Jo-Ann Stores, Inc., VF and VWR — the latter a global supplier of lab and pharmaceutical supplies.

One of the main reasons is that Visalia is a “sweet spot” for most businesses with customers on the West Coast, whether they’re individuals ordering items via the web or department stores and other business selling those goods, said Robert Rodriguez, region manager for West Coast distribution for Hilti, Inc., a European maker of industrial tools which operates two distribution buildings and a separate repair center in the Visalia Industrial Park.

“Its a great spot for transit time,” he said.

Of course, Fresno can make the same claim, and Amazon officials have acknowledged that’s a big part of why it’s locating its 855,000-square-foot fulfillment center there.

The Visalia Industrial Park was in consideration for the Amazon and Ulta facilities, as well as a fulfillment center for Nordstrom department stores in 2016, but they all went elsewhere.

“We’re not chasing the big fish only,” said Devon Jones, Visalia’s economic development manager, noting that leasing several 25,000-squre foot buildings can create as many jobs locally as a single “big fish” tenant.

He noted that if an Amazon-sized business or a larger one ever wants to locate here, there remains about 1,000 acres of undeveloped pre-zoned land in the Industrial Park still available, all with sewage and other utilities close by to connect.

In fact, the City of Visalia last year submitted a proposal for Amazon to build its second headquarters in the city, along with numerous other U.S. cities that included Fresno.

Though the ecommerce giant opted not to consider any California sites, Mayor Warren Gubler said Amazon officials indicated they were “surprised” in a positive way by Visalia’s proposal, “and we weren’t even in their radar, and [now] we’re on their radar.

Among the selling points for the Industrial Park that several of the people interviewed noted is its close access to Highways 99 and 198.

In addition, “UPS is our best salesman, because you’ll have large companies that have locations on the East Coast and the South, the Indiana-Ohio area, Dallas. And when they need West Coast, UPS just looks at our area, Visalia being the perfect spot,” and recommends it, said Pignotti, noting that businesses increasingly rely on next-day delivery, and having a UPS hub literally blocks away in the Industrial Park is a big plus, as is having other next-day shippers there, including FedEx, Golden State Overnight and OnTrac.

Pignotti also credited Visalia’s government, which in recent years has streamlined the processes for permitting construction to the point that Jones said some permit applications can be approved within 30 days.

“Sometimes, less than that,” he said. “Because that’s the last thing somebody wants, being in some municipality where it takes forever to get a permit and get started, and they’ve had a delay, and they don’t want to do that again,” Pignotti said.

Among the reasons DDG builds in Visalia is “They’ve always met their timelines, they work with you, they get things going quickly. They don’t just sit around, so it has been good,” Pignotti said, adding that some cities can be extra attentive for Amazon-sized projects but are much less to smaller ones.

Rodriguez agreed, adding that “In the Hilti world — and we are global — Visalia is in discussions, mainly because of the support by the city and the [Visalia] Economic Development Corp.”

So much so that Hilti — which landed in the industrial park in the 1990s; moved later to a larger, 45,000-square-foot distribution center; opened a second, 20,000-sqare-foot distribution center; and opened a separate tool repair shop — is eyeing the industrial park to expand further, possibly tripling the current size of its distribution operations there, he said.

“My own personal perspective is Visalia has an excellent business park, and it’s known and it’s growing. There are warehouses and businesses going up left and right.”

By Jennifer Commercial • E-Commerce • Economy • Logistics • Manufacturing • New Developments • Top Stories 0 Comments

Merced County Hopes A Deal With Port Of L.A. Turns Former Air Force Base Into Manufacturing Hub

By  • MAR 6, 2018
  • Mark Hendrickson, with Merced County, stands outside the Castle Commerce Center.

    Mark Hendrickson, with Merced County, stands outside the Castle Commerce Center.
    LAURA TSUTSUI / VALLEY PUBLIC RADIO

Just outside the city of Merced, slightly east of Highway 99 is what used to be Castle Air Force Base. Like most areas of the Valley, it’s rural. Across the road from the center are train tracks, and you can hear the railroad crossing signals ding. This unincorporated area of Merced County will soon become an inland port.

Now, there isn’t any water around; we’re still in the Central Valley. It won’t be the kind of port that serves ships and boats. It will be a place for products to be built and materials consolidated, and then sent to the Port of Los Angeles.

Today, two-thirds of the nearly-2,000 acre base is still an airfield, but the rest of it is the Castle Commerce Center.

“This is a site that has roughly about 75 tenants, about a 100 different lease holds,” says Mark Hendrickson, directory of community and economic development for Merced County. “We generate about $2.9 million in lease revenue.”

Merced County is hoping to use a portion of the former Castle Air Force Base as a hub for manufacturing and distribution in the Central Valley.
CREDIT MERCED COUNTY COMMUNITY AND ECONOMIC DEVELOPMENT DEPARTMENT

  Hendrickson says their goal is to redevelop Castle “to really turn it into a site where we can focus some solid attention on manufacturing. We a want to be a place where things are made because when things are made people are working.”

Back in October, Merced County’s Board of Supervisors developed an agreement with the Port of L.A. formalizing what Hendrickson calls a “hub and spokes” development. Merced will become a place of manufacturing and distribution, and use the nearby rail line and freeways to bring goods to L.A. to be shipped around the world. In kind, Castle may also become a place where the Port can send products for distribution.

Merced County isn’t the only Valley county building ties with the Port of L.A. Kern County recently got approval to expand their Foreign Trade Zone at TejonRanch. They also will move the zone’s affiliation to the U.S. Customs and Border Protection at the Port of L.A. The expansion means all of the industrial areas of Tejon Ranch are now within their foreign trade zone. Companies operating there will receive a break on import duties and fees. Tejon Ranch has announced the expansion will bring jobs to Kern County.

Hendrickson says the same could happen in Merced, when it comes to job creation.

“Using today’s workforce numbers, about one out of every nine jobs would be right here at Castle in about twenty years.”

There is one drawback though. More shipping could mean more air pollution.

Dean Florez is a member of the California Air Resources Board and a former state senator from Kern County.

“The kinds of jobs and economic growth this brings are very large diesel trucks that are running a lot of things that make the air a lot worse,” says Florez. “You know, that balance is really important between jobs, growth, and air mitigation.”

One issue is that companies send their trucks full of goods to a port, and then the truck typically returns to the distribution center, empty. If that truck is coming to Merced’s inland port, that could mean hundreds of miles driven just to return the truck.

“Companies need to figure out how to send items to wherever, but that these cargo trucks not come back empty.”

Florez says the Air Resources Board should come up with ways to incentivize companies to share their trucks, and reduce the total number on the road. He also says this is really an opportunity for outside groups to develop something like an Uber for trucks, where they share cargo going to the port and returning to the Valley.

“I doubt it will be state government that comes up with that,” Florez says. “But I do think it will be some outside force that will come in and say, ‘This is the way, really trucks should be running in California, we have this sharing mechanism and it actually would work very, very well.’”

Florez says he plans to bring this up with CARB later this year.

In Merced County, Hendrickson says they plan to use trains to mitigate truck pollution.

“We see our using our rail connectivity on-site to get trucks off the road, improve air quality, open up shipping opportunities for folks not only through Merced County and really throughout the entire San Joaquin Valley to places all over the world,” says Hendrickson.

Finding the best shipping practices from an inland port will take time. And developing an inland port in the first place has been a long time coming.

Mike Dozier is the former Community and Economic Development Director for the city of Clovis. He says that these sorts of deals don’t just happen overnight.

“What happens is you have this vision, and it might be ten years before that vision starts to materialize,” says Dozier.

Dozier says it takes time for infrastructure to develop, and to convince groups to believe in the project’s potential.

“You know, you just build on it, you just have to have things ready for when the time is right.”

For Merced County, officials hope that time is now.

http://kvpr.org/post/merced-county-hopes-deal-port-la-turns-former-air-force-base-manufacturing-hub

 

By Jennifer E-Commerce • Logistics • New Developments 0 Comments

381,600 SQFT Industrial Sale In Tracy Could Attract Record Price For New Industrial Project

Ridgeline Property Group, Central Valley, Tracy Pescadero Distribution Center, LaSalle Investment Management, Tracy Pescadero Distribution Center, Prologis, DCT Industrial Trust, DHL Supply Chain entity,
Rendering courtesy of Ridgeline Property Group

By Jon Peterson

Atlanta-based Ridgeline Property Group could attract a record price on a per square foot and cap rate basis for brand new industrial product in the Central Valley for its planned sale of the Class A, 381,600 square foot Tracy Pescadero Distribution Center in Tracy, according to sources that track the sale of industrial assets in the region.

Ridgeline and its capital source, Chicago-based LaSalle Investment Management, had developed the property together, which was completed in 2017. The 19.46-acre site is less than one mile from Interstate 205, an east-west route connecting to Oakland and San Francisco, and it provides easy access to the regional transportation corridors serving the major markets of the Western U.S., according the company’s statement.

“Tracy, California, is the best distribution location in the Central Valley, and the Tracy Pescadero Distribution Center will provide much-needed Class A space for modern distribution operations,” said Greg Thurman, CEO of Ridgeline Property Group in July of 2015, when the company announced that it was commencing construction of the speculative development. “There is virtually no availability of Class A space greater than 200,000 square feet in the Central Valley. In addition to providing bulk space, this 381,600-square-foot facility will offer the option of either a rear-load or front-load configuration, depending on the needs of the tenant. The flexible design also enables the building to be divided into three separate spaces with front offices.”

The sellers are bringing the asset to market for sale on Monday, and they have hired CBRE as the listing agents on the sale. Two people involved are Darla Longo, vice chairman/managing director and Rebecca Perlmutter, senior vice president. CBRE declined to comment when contacted for this story.

Its rare for new industrial product in Tracy to come up for sale so soon after the property was developed. Most property owners in Tracy are major institutional owners. Two such examples would be Prologis and DCT Industrial Trust. These companies and others are more interested in holding on to their assets for a long period of time.

The Pescadero Center is a single building property. The asset is now 100 percent leased to Excel, which is a DHL Supply Chain entity, and Pactra USA. Both of these companies are considered to be high-credit tenants. The average lease term on these two tenants is 5.6 years.

This investment opportunity offers strong cash flow with significant upside to rents given the steady demand and lack of available inventory driving future rent growth. In-place rents are approximately 5 percent below market, offering the new owner future NOI increases upon lease rollover.

Located at 1700 East Pescadero Avenue, the distribution facility features 32-foot clear heights, 57 dock-high doors, two drive-in doors, a 185-foot truck court, 92 trailer parking spaces, 317 auto parking spaces and Early Suppression Fast Response (ESFR) fire sprinklers. The asset also has an office component inside the property, which is 9,470 square feet, or approximately 2.5 percent of the total building.

The overall 95 million square foot industrial market in the Central Valley remains very strong. The region recorded its 19th consecutive quarter of positive absorption with 2.8 million square feet of net absorption year-to-date bringing the vacancy rate down to 2.2 percent at the end of the third quarter.

The Tracy industrial market has also shown strong operating fundamentals. At the end of 2017, Tracy’s average asking lease rate of $0.45 triple-net had increased 15 percent over the past two years.

Ridgeline is known in the industrial sector as a merchant developer. The company does have a regional office located in Northern California in Roseville.

381,600 SQFT Industrial Sale In Tracy Could Attract Record Price For New Industrial Project

By Jennifer E-Commerce • Logistics • New Location 0 Comments

Ulta Beauty’s first distribution center in California now calling Fresno home

By 
FRESNO, Calif. (KFSN) —

The walls are up at Ulta Beauty’s new distribution center in Southwest Fresno. But it’s taken months to turn Ag land into a commercial business that will soon house hundreds of employees, sending beauty products around the country.

Fresno Mayor Lee Brand said, “We had the right business elements. The right geographical location in California, the right weather, a big enough urban base to have a substantial labor supply, the cost of the building. All of that works in our favor.”

Brand likes the progress he’s seeing, he said the area in Southwest Fresno, known as the “Reverse Triangle”, features an e-commerce business boom with Amazon and Ulta going up. The nearby 41 and 99 will help drivers goods get shipped far north to Canada and as far south as Mexico.

Both Ulta and Amazon combined are expected to fill about 3,000 positions for their new centers.

Brand said, “The bad news is we have a lot of underemployed people. The good news is, now we have solutions to fill these slots. These people are working with social services and other agency sought to get them trained.”

The city is working to get people trained and ready. Ulta has hired its leadership positions to work in the new 670,000 square foot distribution center at the Northeast corner of East and Central Avenues.

Recently they started hiring mechanics and clerks. Online, people can start applying for material handlers or associate positions.

Brand said, “The orders come in, the computerized labels, they’re sorted, probably electronically and robotically– but there’s always humans there making sure those things get out and are done properly.”

The city offered companies a tax incentive per job, which they say will in turn, over a long period of time, will bring a $40-million to $50-million impact to our area.

Now other companies are looking at expanding.

“I think we are on the forefront here in Fresno on this new type of economy, and we’re hoping to really capitalize on it,” said Brand.

Ulta will be hiring during the next six months. They plan to begin shipping to stores and online guests in July.

http://abc30.com/2959548/?sf179533845=1
By Jennifer E-Commerce 0 Comments

Hundreds come for an Amazon job.

BY TIM SHEEHAN

January 16, 2018 10:19 AM

Updated January 16, 2018 03:00 PM

The first day of a three-day job fair in downtown Fresno Tuesday marked the kickoff for people hoping to find work at Amazon’s huge order-processing center under construction at the city’s south edge.

Hundreds of hopeful job-seekers showed up at the DoubleTree hotel. Some waited outside for hours on a foggy, chilly morning for a chance to apply and interview for work.

But dozens left disheartened when representatives of JLL – the company that works as a vendor to Amazon for technical and mechanical staff – told the crowd that they are not hiring for jobs with Amazon itself. People without a technical background were told they need to apply through Amazon’s recruiting website.

 The job fair started at the hotel at Ventura and M streets and will continue Wednesday and Thursday from 8 a.m. to 6 p.m. The event is aimed at recruiting applicants for about 80 technical and mechanical positions – jobs that are separate from about 1,500 employees expected to be employed when the e-commerce fulfillment center opens later this year. Construction on the 855,000-square-foot building began last summer.
 Amazon plans to open a 855,000-square-foot warehouse in Fresno expecting to employ about 1,500 workers when it opens.
Amazon

One of the JLL staffers told the waiting crowd the building will open June 3, but that technicians and mechanics are being hired first to prepare for the start of operations. Those who are hired will be employees of JLL – effectively outsourced by Amazon, but working in the Amazon facility.

Amazon representatives said Tuesday afternoon that they cannot confirm the June 3 date, only that the warehouse is set to open this summer. They anticipate hiring their hourly rank-and-file workers in the mid- to late spring, six to eight weeks before the facility opens.

Amazon also sought to temper the disappointment of those who were turned away from the job fair Tuesday. “We’re encouraged by the outstanding interest we saw today in roles connected to the Amazon fulfillment center,” the company said in a statement. “To be clear, these are roles created by a third-party vendor, not Amazon positions.”

The company added that “When we get closer to the date when hiring will begin for 1,500 full-time Amazon roles later this year, information will be available on www.amazondelivers.job. So far, no jobs for the Fresno fulfillment center are listed yet. Amazon has about a dozen human resources and management positions for the Fresno site at another web page, www.amazon.jobs.

Christian Jackson of Fresno said he and two friends, Rocco Giuseppe and Jordan O’Neill, got in line at about 5 a.m., but walked away dejected after hearing that only people with technical, electrical or mechanical backgrounds were being sought by JLL.

“It’s kinda stupid” to announce a job fair for such a limited range of jobs, Jackson said. He was looking forward to interviewing for one of the more general jobs at the warehouse. “I’m just trying to get ahead and move up in the world.”

Jackson said he most recently worked for a sporting goods store. “It’s not hard to find a job, but it’s hard to find a good job,” he said.

Robert Ortiz Jr. arrived at the hotel about 12:30 a.m. to be the first in line. He said he’s hopeful his experience in building and mechanical maintenance will land him a job with benefits.

Job applicants Tia Mouya, left, and Ulyssa Velaquez, right, go over paperwork as they and hundreds of other job-seekers wait in line up outside DoubleTree hotel for the Amazon job fair on Tuesday, Jan. 16. 2017. Velaquez said she arrived at 4 a.m. to get in line.
JOHN WALKER jwalker@fresnobee.com

Chris Hunter of JLL said the company is taking applications and doing on-site interviews “for the technicians that make the building run.” That refers to people with experience in robotics, mechanical maintenance, conveyor operations and other technical fields.

Hunter said JLL likely will begin hiring a few management positions in February, with a few more hires in March and most in April, all to get the building and equipment ready for the warehouse opening in June.

The technical and mechanical jobs are needed because the Fresno building will rely heavily on technology, especially robotics, for the speed and efficiency required to fill orders. Kelvin Downes, Amazon’s West Coast operations director, said last summer that robots will retrieve merchandise from the warehouse shelves and ferry it to workers who will sort and pack the items for shipping. The robots will “allow us, in some cases, to ship (an order) in minutes rather than hours,” Downes said.

Most of the hourly employees who will work at the Fresno warehouse “will be putting items on shelves, picking items from a shelf, packing it all together to make sure we get the right items in the right box at the right time, and then shipping it out to the customer,” Downes said. He added that the Fresno center will likely handle orders for smaller-sized goods, such as books, electronic devices and toys.

People interested in the nontechnical jobs are being directed to Amazon’s job website at www.amazondelivers.job/.

http://www.fresnobee.com/news/local/article194897094.html

By Jennifer E-Commerce • Logistics 0 Comments

Supply-chain management company offers fulfillment center capabilities

LATHROP—Many smaller companies need the capabilities of a large-scale fulfillment distribution center, but don’t have the space or capital of Amazon or other mega-shippers. Many supply-chain management companies help with business conundrum.

One company with local centers just might have the ecommerce solution for many valley businesses without resources.

Dearborn, Michigan-based Hollingsworth is an end-to-end supply chain management company with 28 distribution facilities located throughout the U.S. and two such locations in Tracy and Lathrop.

In 1991, Hollingsworth began by shipping parts for the Ford Motor Company, a relationship that continues to this day. They are the primary packager for the automotive giant.

By taking on multiple clients, Hollingsworth is able to parse out warehouse space, bringing shipping costs down.

“In the Lathrop area we are very much focused on ecommerce and retail and direct-to-consumer,” said Brian Sheehan, sales and marketing manager for Hollingsworth in this region. “We have local companies and companies that are overseas. It depends on the port of entry for their goods.”

Sheehan said many of their customers are manufacturers, and multiple facilities may be used for one client. Increased facilities also helps Hollingsworth offer same day shipping on behalf of its clients to most areas.

“In a shared warehouse, there’s shared costs,” Sheehan said, allowing for the cost savings to be passed onto the client.

Hollingsworth offers solutions to warehousing, fulfillment, packaging, inventory and program management and more, allowing those who use their services to scale their businesses easily without the hassle of dealing with expansion costs.

With the holiday season estimated to be the peak time for sales, Hollingsworth is preparing for the increased traffic. It’s estimated that the holiday rush accounts for 30 percent of annual sales for many retailers.

By Jennifer E-Commerce • Logistics • New Location 0 Comments

Ulta bringing part of its billion-dollar business to Fresno

Central California

The Fresno Bee
BY TIM SHEEHAN
PUBLISHED MARCH 10, 2017

Ulta Beauty and the city of Fresno officially announced Friday that the cosmetics company has chosen Fresno as the site of a large distribution center that will initially employ more than 500 workers and could swell to more than 1,000 employees with seasonal hires during busy periods.

The joint statement issued by the company and the city confirmed what The Bee reported Tuesday about Ulta’s selection of Fresno for a 670,500-square-foot warehouse to be built in south Fresno. Carolyn Sutphen, a spokeswoman for Ulta, said the distribution center is expected to hire an initial workforce of 542 when it opens in the summer of 2018. It will be built at the northwest corner of East and Central avenues.

Ulta is a growing business that last year reported net sales of $4.8 billion.

The company had identified Fresno last fall as its preferred site, but Ulta representatives told the state in November that the firm was also considering sites in Visalia, Bakersfield, Nevada and Utah. The $110 million distribution center will serve 400 stores and handle fulfillment of online orders from throughout the western United States. Ulta has five other distribution centers in Illinois, Arizona, Pennsylvania, Indiana and Texas. The Fresno center will be Ulta’s first and only one in California.

“This is exactly the shot in the arm that Fresno needs to energize our economy and keep our momentum headed in a positive direction,” Fresno Mayor Lee Brand said in the joint statement. “We’re pleased that Ulta Beauty recognizes the value of our location. …”

As a city councilman last year, Brand was the author of the city’s Economic Expansion Act, which provides for rebates of sales and property taxes, along with other incentives, for companies that relocate to or expand in the city to create new jobs for local residents. In November, working under Brand’s act, the Fresno City Council approved a 30-year package of incentives – chiefly a partial rebate of sales taxes – worth up to $18 million to attract Ulta. To qualify for the city’s incentives, Ulta must create the equivalent of at least 500 full-time jobs at the Fresno center within five years. If the company fails to achieve that by the end of 2022, it would have to repay whatever rebates it had received to that point.

Also in November, the Governor’s Office of Business and Economic Development agreed to provide $8 million in California Competes tax credits to Ulta if it chose a site in California, conditioned on the net creation of 542 full-time jobs in the state.

An economic analysis of the Ulta project that was commissioned by the city last year estimated that Fresno stands to realize about $42 million in additional sales and property tax revenue, even after the incentives.

Ulta, based in Illinois, has almost 980 stores in 48 states; in the Valley, the company has two stores in Fresno and one each in Clovis, Visalia, Hanford and Porterville.

“We are pleased to be expanding in Fresno with a new distribution center that supports our company’s growth strategy and brings additional jobs to the community,” Ulta CEO Mary Dillon said in the joint statement. “This will allow us to continue to grow our stores and e-commerce business. …”

Sutphen, the Ulta spokeswoman, said the company will begin posting job openings on its website closer to the completion and opening date.

Company growing

In its financial results released Thursday for the fourth quarter of 2016, Ulta announced that its sales – both in-store and online – have been growing at a significant clip. The company reported more than $1.58 billion in net sales during the quarter, up almost 25 percent compared with the fourth quarter of 2015. Its e-commerce sales grew even faster, up more than 63 percent compared with a year earlier and amounting to $154.9 million for the quarter. For the entire year, online orders represented $345.3 million in sales for Ulta.

While the city and Ulta waited until Friday to make the formal announcement, the company’s choice wasn’t exactly top secret. Clayco, the Chicago-based contractor that will build the distribution center, already has a construction office on the site, and renderings on the company’s website identified Ulta as the tenant for the building. Clayco’s website indicates that construction is expected to be done by the end of 2017.

Additionally, the careers page of Ulta’s website included a job opening for a human resources director for the Fresno distribution center.

Ulta isn’t the only potential big fish for which the city has baited its economic hook. In December, a month after approving the enticements for Ulta, the Fresno City Council approved a similar Economic Expansion Act package of incentives for Golden State FC LLC, a wholly owned subsidiary of online retail giant Amazon.com. That package of incentives, including rebates of sales and property taxes, has a cap of $30 million over 30 years.

Larry Westerlund, the city’s economic development director, said Amazon deemed Fresno its preferred site for a $200 million, 855,000-square-foot e-commerce fulfillment center that would employ at least 750 workers and potentially hire up to 1,750 employees. There is, however, no word on when Amazon may make a decision on the location.

Brand traveled to Seattle late last week to meet with Amazon officials to pitch the Fresno site. The would-be location for that facility is less than a half mile from the Ulta site, in the North Pointe Business Park near Central and Orange avenues, and was formerly under consideration last year by clothing retailer Nordstrom for a distribution center. Nordstrom has put on hold any decision on a center in the Valley.

By Jennifer E-Commerce • Logistics • Manufacturing • New Developments 0 Comments

CT Realty Acquires 345-Acre Industrial Parcel in Stockton, Plans $135MM Build Out

Central California

The Registry
Posted on

CT Realty (CT) has acquired 345 acres of industrial land within the master-planned NorCal Logistics Center in Stockton, Calif., with plans to develop 4.4 million square feet of high-clearance distribution, e-commerce/logistics and advanced manufacturing buildings. The project, which breaks ground this month, includes an unprecedented amount of speculative construction for Northern California.

Valued at $135 million, the first phase of development includes approximately 1.7 million square feet in three buildings, including a 1,122,341-square-foot building that will be the single largest spec building developed in Northern California. Two additional buildings of 388,183 square feet and 186,944 square feet will complete Phase 1. Beyond the planned development, NorCal Logistics Center has sites available for build-to-suit developments ranging in size from 100,000 square feet to more than 1.9 million square feet.

“We view this as a long-term development opportunity to assemble a world-class logistics campus in one of the strongest markets in America,” said Carter Ewing, managing partner of CT Realty. “The dynamics of California’s Central Valley region, with an industrial base of more than 185 million square feet, mirror the favorable activity we have encountered over the last three years in Southern California and other major distribution markets in Dallas, Atlanta and Chicago.”

NorCal Logistics Center, which is already home to General Mills, Fresh & Easy and Fox Head, is located in the heart of California’s Central Valley industrial market and serves an extension of the global logistics supply chain infrastructure directly linked to West Coast ports in Oakland/Stockton, Los Angeles/Long Beach, Portland, Ore., and Seattle/Tacoma, Wash. The project is proximate to key intermodal facilities operated by Burlington Northern Santa Fe and Union Pacific railroads, and is accessible to SR-99, I-5, I-205 and I-580, linking to all major Northern California markets and strategic Western U.S. destinations.

“The evolution of modern logistics infrastructure, including inland ports, sea ports and commercial rail systems, has changed the dynamics of how containerized cargo is distributed nationwide and throughout the world,” added Ewing. “Investing in buildings that are strategically located near this infrastructure is integral to meeting the demands of today’s most progressive logistics users, and this is at the heart of our national strategy. The locational attributes of NorCal Logistics Center give us confidence that this will become one of the premier master planned logistics parks in the entire Northern California market,” added Ewing.

CT and related development partnerships are developing speculative and build-to-suit Class A logistics buildings for some of the largest industrial users in America. The company has acquired or developed 7 million square feet of industrial buildings in the U.S. over the last 36 months, experiencing strong leasing activity from projects that have been well received in their respective markets.

“NorCal Logistics Center represents the calculated expansion of an industrial logistics strategy we began implementing aggressively across the country five years ago,” said J.C. “Watty” Watson, managing partner of CT.

CT has capitalized much of its acquisition and development activity with Diamond Realty Investments (DRI) the U.S. real estate investment arm of Japan-based Mitsubishi Corporation. Both DRI and CT have 25-year histories in development and investment.

“We are delighted to again combine forces with DRI in this exciting new venture,” added Watson. “Together, we have almost 4 million square feet under construction and another 10 million square feet in our development pipeline on land that we own across America.”

The project is designed by Ware Malcomb, a premier architectural design firm with global experience in logistics and distribution facilities. Construction financing is provided by Cal Bank & Trust and Fifth Third Bank.

CT acquired the NorCal Logistics Center parcel from Arch Road, L.P., a partnership controlled by Minnesota-based Founders Properties and represented in the transaction by Darla Longo, Barbara Emmons Perrier, Rebecca Perlmutter, and Michael Kendall of CBRE National Partners. CT was represented by Cushman & Wakefield’s Kevin Dal Porto, Blake Rasmussen, John McManus and Tyler Vallenari, who will provide ongoing leasing, sales and market support services.