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.

Organic meal kit service eyes Fresno for distribution center, 356 jobs

Central California

Published on 06/09/2017
Written by Gabriel Dillard and John Lindt 

Green Chef, an organic meal kit service, is eyeing Fresno for a distribution center that could hire up to 356 people. Image via Green ChefA Colorado-based organic food delivery service has its sights set on Fresno for a distribution center that could eventually employ 356 people with an average full-time salary of $30,000.

Green Chef Corp., a subscription meal kit service founded in 2014 that specializes in organically-sourced food, is up for a $2.5 million California Competes tax credit with plans to invest $17.2 million in a Fresno delivery hub, according to the Governor’s Office of Business and Economic Development (Go-Biz).

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.

Amazon breaks ground on Fresno fulfillment center

Central California

Published On June 19, 2017 
The Business Journal
Written By David Castellon

 

In case it wasn’t obvious to the dozens of city, county, state and Fresno-area business leaders gathered late this morning on the edge of a dirt field along Fresno’s southern tip, Kelvin Downes told them why they were there.

“Well, it’s official. Amazon’s coming to Fresno,” Downes, head of West Coast operations for Amazon’s fulfillment centers, told the crowd, repeating the announcement the online sales giant announced at the start of the month.

As for the crowd, it was gathered for the groundbreaking of the planned 855,000-square foot building that will house Amazon’s tenth California fulfillment center, where items purchased on Amazon.com are shipped out to customers.

Fresno was selected, in part, because of its location between Southern California and the Bay Area, as well as its proximity to major freeways to Northern California, Oregon and Washington, as well as parts of Nevada.

Because of the company’s focus on two-day shipping under its Amazon Prime program, Downes said most of the goods shipped from the Fresno Fulfillment Center will go to locales on West Coast, but it also will ship goods across the country.

“The support we’ve received from the city, the county and the state on this project has been phenomenal,” said Downes, who specifically thanked, among others, current Mayor Lee Brand — a city councilman for Fresno when the project first was proposed — and former mayor Ashley Swearengin, who was in the audience for the groundbreaking.

“Look around you. This is the future of Fresno, and it all begins with Amazon,” Brand told the crowd gathered under a tent and handed bottles of cold water, providing some relief from the day’s heat as it approached the triple digits.

“This is the game changer,” he said of Amazon locating a fulfillment center here, adding that “It changes the narrative for Fresno.”

The fulfillment center will be built in the 3500 block of Orange Avenue, on the edge an industrial park that includes the new 670,500-square-foot distribution center for Ulta Beauty, which is under construction next door to the planned Amazon site.

Ulta is expected to employ more than 500 people initially and possibly grow that number to about 1,000, while Downes said Amazon expects to employ more than 1,500 people here from the start.

He said that besides offering competitive pay, the employees’ compensation package will include stock options and a program that could pay up to 95 percent of their college tuitions.

Downes noted that the $150 million facility will be among Amazon’s largest fulfillment centers, and it will include a large contingent of robotic devices to pull and pack items, alongside the human “Amazonians” working there.

Brand has announced that he wants to parlay Amazon and Ulta choosing to build distribution centers here as selling points to help promote Fresno as a prime spot for distribution centers.

In fact, he said the city is will try to locate such businesses and other types of large industry to the “triangle” of vacant parcels near the junctions of highways 41 and 99, neighboring the Ulta and Amazon sites.

Both Downs and Brand praised the work of Swearingen for helping get the ball rolling to bring Amazon to Fresno.

For her part, Swearingen said it wasn’t as daunting a task as some might expect, because she and other city leaders had been preparing the parcel — which included connecting water and sewer lines and other infrastructure close by — for a group of other interested developers who ended up pulling out.

So the land was practically “shovel ready” for a large development when Amazon — “We didn’t know it was Amazon at the time. We only knew it was a large developer” — approached city officials with an interest in locating here in late 2015.

“We were really prepared and able to push this locale,” Swearingen said, adding that the city also had prepared tax incentives for the other developers and used them as a template for offering tax incentives to Amazon.

Those incentives will total $30 million over 30 years, part of that in the form of partial reimbursements for the city’s portion of property taxes Amazon will pay, along with 100 percent of the city taxes paid by developers when they purchase construction machinery and building material, said Larry Westerlund, Fresno’s economic development director.

But the deal will be contingent on Amazon employing at least 750 people — half of its planned workforce — here, he and Brand noted.

Brand said those tax incentives should be offset by the economic benefits from the people working at the Amazon Fulfillment Center, as will goods and services purchased locally by Amazon, adding more jobs and economic gains for the area.

During his speech, Downes said that Amazon tries to be a good neighbors wherever the company locates, and in that vein announced the donation of $10,000 to the Fresno County Library system to help fund its DigiBus, essentially a computer center in a bus offering computer classes and computers for the public to use in different locations.

Dermody Propeties, a New Jersey-based capital development firm that is partially funding the new Amazon facility and will lease it to Amazon once construction is complete, provided a matching $10,000 donation to DigiBus.

MRC Global Inc. opens distribution center in Shafter

Central California

THE BAKERSFIELD CALIFORNIAN

Published June 9, 2017

The U.S. subsidiary of MRC Global Inc. has opened a new regional distribution center in Shafter that will hold about $15 million in inventory to support the company’s operations on the West Coast and Alaska, officials announced Friday.

The new facility at 4000 Fanucchi Way includes about 80,000 square feet of warehouse space, including a 5,000-square-foot valve and engineering center, a 15-acre pipe yard that has a state-of-the-art pipe cutting facility, and a two-story, 11,000-square-foot office building, MRC Global said in the release.

 The center will employ about 36 people and support 19 MRC Global branches.

“This new RDC is a demonstration of our commitment to our customers in this region,” MRC Global President & CEO Andrew R. Lane said in the release. “As the energy industry enters into a recovery, we are well positioned to support our customers.”

 Headquartered in Houston, MRC Global Inc. is the largest worldwide distributor, in terms of sales, of pipe, valves and fittings and related products and services to the energy industry, the company said in the release.