Also: U.S. Bancorp Renews 400,000-SF Lease; and more Headquarters Property News from: Banco de Crédito e Inversiones, EmCare, Invista, Perry Ellis, Siemens and many others
As companies continue to find ways to reign in expenses, another three firms disclosed plans this past week to pull in some widely scattered operations into consolidated headquarters
HID Global, which provides secure identity solutions, initiated a comprehensive, multi-year project to establish a new North American center of operations in Austin, TX.
The project will commence with breaking ground on a 200,000-square-foot facility in December of this year. Once the building is completed, existing manufacturing operations, warehousing, distribution and customer service activities across North America will be consolidated into the Austin facility.
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"The robust business climate and positive economic conditions in Austin were strong considerations in our final site selection," said Denis Hébert, president and CEO of HID Global. "Of equal importance was that the innovative, vibrant culture in the community aligns so well with our company culture and values. The bottom line is that Austin is a great place for us to invest in the future growth of our business."
The new Genuine HID Operations Center for North America will become the company's largest facility in the region. The decision to locate in Austin was the result of a comprehensive evaluation process.
Devon Energy Corp. plans to consolidate its U.S. personnel into a single operations group centrally located at the company's corporate headquarters in Oklahoma City. As a result, Devon will close its office in Houston and transfer operational responsibilities for assets in South Texas, East Texas and Louisiana to Oklahoma City. The company expects to relocate a number of employees from Houston to Oklahoma City.
This initiative is expected to be substantially completed by the end of the first-quarter 2013.
"Consolidating our U.S. operations will improve our ability to quickly shift the focus of our workforce between project areas as economic conditions dictate," said Dave Hager, Devon's executive vice president of exploration and production. "In addition, this move will improve the sharing of best practices and enhance overall operational efficiency."
Devon expects the announced changes to deliver savings of approximately $80 million annually. The cost reductions will materialize through both lower general and administrative expenses and reduced capitalized personnel costs.
Reorganization charges are expected to approximate $125 million, with $100 million estimated to be incurred in the fourth-quarter 2012. The remaining costs will be incurred in the first half of 2013. In aggregate, roughly 20 percent of the total restructuring charges are non-cash.
American Locker Group Inc., which offers secure storage solutions, completed its relocation and consolidation from its Ellicottville, NY, operations into its DFW Airport facility. The Ellicottville operations manufactured and serviced the iconic orange key and lock system.
The company made the decision to consolidate its orange key and lock operation with its Texas metal fabrication facility as part of its ongoing strategy to streamline operations, improve customer service and reduce costs.
Previously, American Locker had to ship keys and locks from New York to be mated with lockers in Texas before delivery to customers. As a result, one of the immediate benefits of this consolidation will be to shorten lead times, thereby enabling ALG to fill customer orders more quickly.
American Locker estimates that this move will provide an additional benefit insofar as it will generate annual payroll, occupancy and transportation savings of $240,000. The full effect of these savings will start being recognized in the first quarter of 2013.
U.S. Bancorp Renews 400,000-SF Lease
By: Justin Sumner
U.S. Bancorp has renewed its 395,493-square-foot headquarters lease at 800 Nicollet Mall in Minneapolis, MN. The ten-year deal will commence in June 2014.
US Bancorp Center is a 30-story, 1.03 million-square-foot, class A
office building located on 1.2 acres in Minneapolis's central business district. The building was constructed in 2000, and US Bancorp has occupied space in the office tower ever since. The property features a noteworthy indoor Skyway which connects the second and ground floors with neighboring buildings, creating an inviting and heavily-trafficked retail environment.
"As a proud Twin Cities-based company, we're happy to renew our commitment to our headquarters city of Minneapolis," said Elliot Jaffee, Minnesota market president for U.S. Bank. "Not only are we keeping the same amount of space, we are upping our commitment by another decade."
Minneapolis-based U.S. Bancorp is the parent of the fifth largest commercial bank in the country. The bank employs more than 10,000 people in the twin cities, and including this renewal now occupies more than 2.8 million square feet of commercial space in the metro area.
While the renewal deal has the tenant retaining the same amount of space in 800 Nicollet that it currently occupies, the new lease carves out Piper Jaffray. U.S. Bancorp spun off the company in 2003, which negotiated its own direct lease with building owner Piedmont earlier this year.
Russ Nelson and Tina Hoye of Nelson Tietz & Hoye represented U.S. Bancorp in the negotiations. Ken Mulrane, CFA, senior vice president at Piedmont Office Realty Trust, Inc. facilitated negotiations in-house on behalf of the owner.
8x8
8x8 Inc. formally opened new headquarters at 2125 O'Nel Drive in San Jose, CA, occupying nearly 105,000 square feet - more than double the amount of space at its former headquarters in Sunnyvale, CA.
8x8 has experienced consistent growth in customers, revenue and profitability over the last several years due to the increased adoption of its cloud-based unified communications solutions.
"We never anticipated that we would outgrow our former headquarters in only three years," said 8x8 chairman & CEO Bryan Martin, "especially since that facility was only a little over half full when we moved in."
The new facility is 8x8's corporate headquarters location for employees performing all corporate functions, including finance, human resources, sales, marketing, product management, engineering, research and development, and customer service and support as well as 8x8's Network Operations Center, with space for additional hires to accommodate growth.
AFL
AFL, a maker of fiber optic products and equipment, will expand its existing operations in Spartanburg County, SC. The $8.6 million investment is expected to generate 95 new jobs.
AFL will move approximately 110 current employees and operations into a new building at 104 Hidden Lake Circle in Duncan, SC. The company will then add a new product line at the company's existing facility at 260 Parkway East, also in Duncan. The move and expansion are expected to be completed by late 2013.
Banco de Crédito e Inversiones
Banco de Crédito e Inversiones (BCI), Chile's fourth largest bank, signed a long-term lease for 22,567 square feet at Southeast Financial Center, Florida's tallest and largest office tower and plaza. The transaction represents not only a relocation for BCI, but a doubling in size of its footprint in Miami.
"As the domestic and Latin American economies experienced stabilization, cautious growth has drawn marquis companies in this sector to Southeast Financial Center's iconic status, complementary tenant base and hub as the business epicenter of Downtown Miami," said Donald Cartwright, senior vice president with Jones Lang LaSalle. "The banking sector, both domestic and international, is very active in the market and we expect to see more transactions of this type - expansions and relocations."
Cartwright along with Jones Lang LaSalle vice president Nicole Vassilaros are the exclusive leasing agents for Southeast Financial Center.
"Without question, the roads of economic prosperity for the America's run through Miami," said Grisel Vega, general manager with BCI. "As international companies create inroads within Miami as the gateway to the region, they require a myriad of services specific for financial growth. We felt the timing was perfect to expand our operations and Southeast Financial Center is emblematic of our strategy and level of brand integrity."
Doug Campbell, president of The Campbell Group, represented the tenant in the transaction.
Blue Buffalo
Blue Buffalo Co., one of the country's largest independent pet food companies, broke ground in Joplin, MO, on a new manufacturing and distribution center, an investment that is expected to create up to 150 new local manufacturing jobs. The 400,000-square-foot facility represents a major capital investment by pet food maker.
Cambridge-Lee Industries
Cambridge-Lee Industries LLC, which manufacturers copper tubing, is completing a 194,500-square-foot expansion of an existing building in Ontelaunee Township, PA.
The expansion will create at least 269 new jobs within three years and retain 319 existing employees.
The company will receive a $2 million, 15-year loan at 2.25% to. In addition to a Pennsylvania Industrial Development Authority loan, Cambridge-Lee Industries received a funding offer from the state, including a $1 million Pennsylvania First grant, $538,000 in Job Creation Tax Credits, $121,050 in job training assistance and a $3 million loan from the Machinery and Equipment Loan Fund.
Clean Vehicle Solutions
Clean Vehicle Solutions LLC, moved to larger facilities to accommodate unprecedented growth in the demand for natural gas fueling systems in passenger vehicles.
The new facility in West Nyack, NY, is a state of the art facility designed specifically to convert traditional gas/diesel fueled vehicles to CNG fueled systems.
"The establishment of a new global headquarters and state-of-the-art production facilities provides us with the ability to deliver a wide range of vehicles and manage production far more efficiently than ever before," said Dean Sloane, managing director of Clean Vehicle Solutions. "We completely outgrew the facility we were using in East Brunswick, years ahead of schedule."
EmCare
EmCare Inc. amended its office lease that it just signed in March of this year for its headquarters at 13737 Noel Road in Dallas. EmCare already leases 82,972 square feet,
EmCare has now agreed to expand its leased premises to include 12,282 square feet on the 13th floor in February 2013. It also now has the option for another 12,000 square feet on the 12th floor.
Invista
Invista will grow its Performance Surfaces & Materials business at its Camden, SC, production facility. The $20 million investment is expected to create about 50 new jobs in Camden by the first part of 2014.
"An investment of this size will further strengthen Invista Camden's position as the preferred supplier of nylon 6,6 carpet fibers for residential and commercial end products," said Paul Liddle, Camden site manager for Invista.
Camden's proximity to mill customers in the Southeast U.S. was also a key factor in the decision to expand the facility's production. The company said customers are expected to benefit from reduced shipping time, increased order flexibility and reduced lead-time for orders.
The expansion includes new equipment and reconfiguration of existing equipment. Improvements will begin in early 2013 and are expected to be completed in the first part of 2014. New employment opportunities will be phased in during the course of the expansion.
Invista's Camden manufacturing site began operations in 1950. Located on 1,100 acres, the facility's primary products include carpet fiber used in the automotive industry.
Perry Ellis
Perry Ellis International Inc. (PEI) committed to a direct, long-term, 39,000-square-foot lease for showroom and
office space at 530 Seventh Ave. in New York.
The new lease enables PEI to consolidate its women's wear business into one location in close proximity to its other Manhattan offices.
The company relocated a portion of its operations in 2009. The additional 18,500 square feet of space on the second floor will house Perry Ellis International's Rafaella division.
Bob Savitt, Brian Neugeboren and Marc Schoen, acted on behalf of the ownership, while Robert Martin, Matt Astrachan, Alex Chudnoff and Brad Lane of Jones Lang LaSalle represented Perry Ellis International in the transaction.
QlikTech
By: John Walz
QlikTech, a business intelligence software company, signed a 10-year lease for 18,601 square feet at 577 Airport Blvd. in Burlingame, CA. QlikTech's lease includes the entire eighth floor.
The property is owned and managed by Equity Office.
Scott Miller and Tim Glenn of Jones Lang LaSalle represented QlikTech. Tim Grant and James Lees of CBRE represented Equity Office.
Quorum Business Solutions
Quorum Business Solutions Inc. relocated its Houston to BG Group Place at 811 Main St., leasing two full floors, with more than 53,000 square feet.
Quorum now employs more than 225 energy software professionals at its Houston location, with more than 350 employees overall. The new facilities represent a significant increase in capacity over Quorum's previous Houston office space.
The downtown Houston location will provide Quorum with improved proximity to many of its Houston-based oil and gas clients.
SeniorTV
SeniorTV is relocating its corporate headquarters to accommodate growth. The new facility is at 975 Tallmadge Ave. in Akron OH. The 30,000-square-foot location will be home to IT, customer service, engineering, purchasing, accounting, marketing, and offer additional space for its warehousing, distribution and on-sight equipment fabrication department.
ShopperTrak
By: Rachel Ladysh
ShopperTrak RCT Corp., a firm that measures foot traffic, leased 52,450 square feet of office space on the 41st floor of Willis Tower in Chicago. The company will move its headquarters to 233 S. Wacker Drive in the spring of next year.
Bill Sheehy and Daniel McCarthy of Jones Lang LaSalle represented ShopperTrak. Derek Rolison and Michael Kazmierczak of U.S. Equities Realty LLC represented the landlord, a joint venture which includes The Moinian Group.
Siemens Industry
Siemens Industry Inc., a maker of mechanical and electrical drive equipment, plans to establish a new plant in Greenville County, SC.
According to Doug Keith, president of Siemens Drive Technologies Division, the new South Carolina geared motor facility will place the company and its products manufactured in South Carolina closer to machine builders and manufacturers in the Southeastern United States.
The new plant will be an assembly and manufacturing facility, part of the company's Drives Technologies Division, Mechanical Drives Business Unit. The 45,600-square-foot facility will be in the city of Mauldin.
Keith said the site combined all of the necessary elements Siemens was seeking in a location, including proximity to transportation infrastructure, such as interstates and ports, a highly skilled workforce with reputable educational institutions nearby, a green-minded community and a dedicated group of business partners.
Stone Trucking
Stone Trucking Co. signed a contract on 38 acres in Creek County, OK, a few miles away from its current headquarters in Kiefer, OK. This will increase office space as well as storage capacity for the growing company.
Stone Trucking is also expanding its terminal locations throughout Texas and surrounding states. Its latest additions will increase service coverage in South Texas.
The growth the company is experiencing is an overall strategic plan the company has envisioned for the past three years.
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