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WilmingtonBiz Magazine

Jump Starting A Park

By Christina Haley O'Neal, posted Sep 28, 2018
It took more than a decade for the vision to pay off, but activity in the Pender Commerce Park is heating up with incoming private investment.
 
Pender County Commissioner David Williams said the economic recovery from the recession, opening of Interstate 140 and momentum from early tenants has helped peak interest in the park.
 
The long-term effort and a hefty investment from Pender County to develop its industrial space off U.S. 421  has led to more than 470 jobs either already at the park or being added by new tenants announced this year.
 
But conversations that lead to the Pender Commerce Park began 15 years ago.
 
Williams said those talks started in early 2003. County leaders at the time began working with economic development officials at Wilmington Business Development to find the right  space to develop the county’s inventory.
 
“Arguably, this part of our territory was in desperate need of a good, quality product,” said Scott Satterfield, CEO  of Wilmington Business Development (WBD). “There’s always been a deficit  of product, in particular a fully infrastructured product, on U.S. 421 in general.”
 
Officials looked to BASF Corp.,  which had hundreds of acres of land along U.S. 421 that spanned over the New Hanover-Pender county line, Satterfield said.  
 
“When we looked at that [land] – the [WBD] board leadership, key people with our organization, key people with Pender County, started thinking: ‘What if we approached BASF about the possibility of taking down that property?’” Satterfield said.  “Maybe they would be reasonable in their sales price and if indeed, the county leaders would buy into that because it’s going be a long-term deal. This is not a buy-it, sell-it situation. It’s going to be multi years of getting the infrastructure in play [and] having a reason to put in infrastructure.”
 
Pender Commerce Park was eventually obtained in a two-tract purchase from BASF, the first of which  was for nearly 380 acres in 2006 for $4 million from the county’s general fund, according to Pender County officials. The second purchase was for an additional 396 acres in 2010. That acquisition was for about $1.6 million, paid through a promissory note between the county and BASF in five annual payments from the county’s  general fund.
 
Some of the land was vacant, but there were also some structures on the acreage, including a former wastewater plant, according to county officials.
 
The land deals “didn’t happen overnight,” Williams said, and it took a lot of discussion and planning. But county officials believed the U.S. 421 corridor was going to become a hub for business, and the land wasn’t going to get cheaper, he said.
 
“It was knowing that we were preparing for the future,” Williams said. “We are investing for the future in a corridor that we absolutely knew was. going to be hot like it is today.”
 
Williams noted that at the end of the day, it was the county commissioners who “put their neck out there” to purchase the space, and the board did catch some heat for it, he said.
 
At the end of the land buys, the county had on its hands nearly 800 acres – about 450 of which could be developed. (The remaining acreage is wetlands and not suitable for development).
 
But the product sat untouched for years until one company showed interest in 2013.
 

HOOKING THE FIRST TENANT 

New-York based Acme Smoked Fish (shown below) was nearly ready to pull the trigger on a Virginia site for its first out-of-state  expansion, said Richard Nordt, who led the search for the company.
 
Late in the game, Pender Commerce Park was thrown in the mix, said Nordt, who was vice president of engineering and manufacturing for Acme at the time and has since retired.
 
Duke Energy’s economic development team contacted WBD about a lead on a food processing company that was searching for a site, Satterfield said.

They thought Pender Commerce Park would fit the business  and threw its name in the hat.
 
There was some “stiff competition,” Satterfield said.  
 
Acme and WBD connected, and on July Fourth weekend in 2013, Nordt flew  down to look at the site. That August, Acme made the decision to build its new facility at the Pender Commerce Park, Nordt said.
 
“Everything needed to be put in place. It was basically just ground and trees. That first vision – when I walked  up the site on U.S. 421 – there were no roads. We basically trenched through the forest there and got up to the top of the site where the proposed location was for the facility,” Nordt said. “I kind of just looked around and saw a great opportunity, and it was more or less a vision of knowing what Acme was as a company, but more importantly looking at that site and its location.”
 
In 2015, the company started operations.
 
Acme promised a nearly $30 million investment at Pender Commerce Park and 120 jobs, which the company has exceeded. There were also incentives for the company being the first tenant in the park, Williams said.  
 
Acme received nearly $1.7 million in county incentives, including the land donation, water and wastewater fee waiver and site preparation, according to the county.
 
There was also a 10-year industrial incentive grant from the county for more than $926,000 with RC Creations, doing business as Acme, but no performance incentive payouts have been made to date, county officials said.  
 
Acme also received a 12-year state Job Development Investment Grant of up to $975,000 in late 2013, and has received more than $137,000 through 2016, according to the N.C. Department of Commerce.
 
Today, Acme continues to produce a range of salmon products at the Pender Commerce Park and is growing.
 
In July, the company installed its sixth slicing and packaging line at the facility, began a second shift and added 40 jobs, bringing the total employment at the site to more than 200 people, said Felipe Espinosa, director of manufacturing at Acme.
 
Future plans call for adding additional equipment at the site and expanding the plant’s footprint.
 
“They were the right first tenant,” said Billy King, WBD’s director of business development.


INVESTING IN INFRASTRUCTURE  

That initial commitment by Acme got the ball rolling for putting in the infrastructure needed to support business at the park.
 
“[Acme] took a leap of faith. We were selling them what we were going to do. We didn’t have any product on the ground. We had land, and we had a water plant, but we didn’t have the rest,” Williams said. “The Acme commitment was the catalyst to the ... commitment to make all the improvements that go along with a first-class industrial park.”  
 
The county had already zoned all the land as industrial property, WBD officials  said.
 
Piedmont Natural Gas also brought in gas lines to the park. AT&T brought in fiber to the park, which made it AT&T’s first Fiber Ready-certified business park  in the state, King said.
 
“It’s Duke Energy site ready, and it’s AT&T Fiber Ready. And all those things make a difference when you’re marketing a site because it’s such a competitive business,” King said. Infrastructure improvements for things such as roads came to nearly $4.2 million, with more than $3 million of that financed with part of limited obligation bonds the county issued in 2015 for various projects, county officials  said.
 
The county had also established an $18 million water treatment plant at the park in 2012 and later added a $28 million wastewater plant in 2017. Those plants, while attractive to prospective tenants, are utilities that can service beyond the park. More than $11.4 million in grants aided those projects, officials said.  
 
“There’s been a lot of moving parts to get us to where we are,” Williams said. “The whole park is not done. This is just the first section. There’s still a lot more land that’s untouched.”
 
There remain more than 300 acres left to develop.
 

THE PAYOFF 

The year after Acme began operations in the Pender Commerce Park, a local operation investigated moving to the site.
 
It proved to be a good fit for Atlanta-based Empire Distributors, which relocated its operations from Castle Hayne to the industrial park in October 2016.
The reason for the move was to ramp up operations in the area to a full-scale warehouse and beverage distribution center, said Jay McGrady, general manager at Empire Distributors (pictured left, photo by Terah Wilson). The company built 179,000 square feet of space on 18 acres of land at the park.
 
“It was a good opportunity to come here,” McGrady said. “It’s a little bit farther than we wanted to go originally. But the infrastructure was already here at the park, as far as what the county had already put the money into it through the water, sewer and all those other things.”
 
The company built with room to grow for another 30 years, McGrady said. Since opening, Empire Distributors has maintained its 100-employee base at the site.
 
And the employee count at Pender Commerce Park is set to increase with the pending additions of two new businesses, both of which were announced in February.
 
Like Empire Distributors, Coastal Beverage Co. is not a new employer to the area but is moving its workers and operations from New Hanover County to the Pender park.
 
Coastal Beverage plans to move from Harley Road to a new headquarters facility on a 27-acre site in Pender Commerce Park. The company has plans for a more than 170,000-square-foot warehouse distribution center and corporate office.  
 
The company will bring its existing employee base of about 140 people with the move, said Tee Nunnelee, president of Coastal Beverage.
 
The beverage distribution company closed on the park property in late August and has a goal to be operational at the site in mid- to late- 2019, he said.
 
Another 25 employees could come with the addition of a service center for FedEx Freight, a less-than-truckload carrier and a unit of FedEx Corp., on a 12.5-acre parcel at Pender Commerce Park.

Construction at the site (shown left) is now underway. Officials said the Memphis based company planned to invest at least $5 million for the facility.
 
According to the county tax office, Empire and Acme’s 2017 land and building values totaled $18.8 million. The taxes generated from that was more than $166,700, officials said.  Business personal property generated tax revenue of nearly $109,000.
 
With the addition of FedEx and Coastal Beverage’s facilities, the four businesses at Pender Commerce Park represent an estimated $71 million in private investment, which includes all the land cost, building construction, machinery and equipment, WBD officials said.  
 
“It was a bold step, and we took some criticism. But we knew that U.S. 421 was going to be the future,” Williams said. “If you fast forward, now you can see all the new business out there."
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