Charlotte-area facilities couldn’t quench Niagara Bottling’s thirst

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MOORESVILLE – Tommy Turner specializes in finding industrial sites in small markets for commercial real estate clients.

So it was only natural that he found himself working with a company like Ontario, Calif.-based Niagara Bottling, which came to him in 2010 looking to open a distribution center in Virginia or the Carolinas.

But the search for the perfect space ended up being tough — really tough. It was so tough that, in the end, Niagara ended up just building a $45 million plant, which opened this summer in Mooresville Business Park.

“In spite of the fact that we were tracking more vacant industrial space in the Carolinas and Virginia market than we’ve ever tracked, the structural requirement made it hard to fulfill that request with an existing industrial building,” said Turner, co-owner of Philadelphia-based Hart Corp.

Turner said Niagara wanted to open the distribution center to take some workload from its two facilities in Allentown, Penn., and Orlando, Fla.

“They had a luxury of time to work with, so that helped,” Turner said.

It was supposed to be the 10th location for Niagara.

But it soon became as if Turner had become trapped in some sort of Goldilocks real estate story: The buildings Niagara considered were too big, too small or too dry. Like Goldilocks, Niagara couldn’t find one that was just right.

Niagara had told Turner that it needed a building that was from 200,000 to 500,000 square feet and had at least a 24-foot ceiling. The company also said its new location would require sewage service that could process 500,000 gallons per day and water service that could handle 1 million gallons per day.

Turner’s initial search found 39 buildings that met those requirements. That list was whittled down to 12, and Niagara representatives toured each of those with Turner.

After the tours, eight “made the cut,” Turner said, adding that he also found six build-to-suit sites in the Charlotte and Winston-Salem markets.

“The game plan was to look for existing vacant industrial facilities that met their geographic criteria, and their water and sewer requirements, and had 1,000 linear feet,” Turner said. “That was a 400-feet-by-1,000-feet configuration. That kind of building is few and far between even in that large geographic area.”

After searching for the better part of a year, Turner realized he couldn’t find a building that Niagara would like. So, on June 22, 2011, Niagara and the North Carolina Department of Commerce announced that the company would build a 310,000-square-foot building on 79.8 acres at Mooresville Business Park. The building had its grand opening June 8.

Scott Hensley, a broker with Charlotte-based Piedmont Properties and president of the Charlotte Region Commercial Board of Realtors, wasn’t surprised that Turner and Niagara’s search was an ordeal.

“While demand for industrial buildings in the Charlotte market has been down over the past few years, in many instances it remains difficult for expanding or relocating companies to find modern, functional industrial buildings in our market to purchase,” Hensley said.

That’s particularly true for tenants who want buildings that are larger than 100,000 square feet, he said.

Like Turner, Piedmont Properties worked with a client who ultimately had to build an industrial facility because one that was the right size couldn’t be found.

Hensley said Piedmont recently represented Britax Child Safety in its search for a new U.S. headquarters and assembly and distribution center. The company wanted a 480,000-square-foot facility.

Initially, Britax told Hensley it wanted an existing building. But it was a tough request to fill, Hensley said.

“Very few buildings of this size exist in our market, and even fewer were available,” he said. “We quickly determined the only way for them to remain in our market was to pursue a build-to-suit.”

That led to other challenges, though.

“We are faced with a real shortage of industrial-zoned property available for future industrial development,” Hensley said. “As a city, we need to address this issue immediately and start identifying areas suitable for industrial development and proactively rezone those parcels now.”

Turner said he’s been involved in helping companies find sites for their businesses for 24 years with Hart.

“It is fairly typical that these searches take 18 to 24 months,” he said. “So this (search for Niagara) wasn’t too bad.”

While finding a building that was the right size was hard, finding one that met the company’s water needs was not as difficult in the Carolinas because of the their history as textile hubs, Turner said.

“That is one of the things we are blessed with in the Carolinas — all the sewer capacity and water capacity — because the states were so heavily invested in textiles,” Turner said. “It left tremendous vacant capacities in these systems that were built over the years to support these textile mills.”

BAUGHMAN can be reached at [email protected] or (704) 247-2911.