Economic Development

$80M Logistics Center Planned for Mercer County

HERMITAGE, Pa. – A developer that builds warehouses and fulfillment centers for the e-commerce industry plans to construct a 1 million-square-foot logistics center at Exit 15 of Interstate 80, a project that could be just the start of development at the site, a company executive said Thursday evening.

Clayco Realty Group is under contract to acquire and perform due diligence on the 2,016-acre site, W. Scott Caplan, senior vice president with CRG, said. CRG is a unit of Chicago-based Clayco Inc. that acquires, develops and operates real estate assets.

CRG was among the honorees at Penn-Northwest Development Corp.’s annual meeting and awards dinner, which was held at the Avalon Golf & Country Club at Buhl Park.

“We’re really excited about the investment that we’re going to be making in Mercer County,” Caplan said.

Valued at $2.6 billion, the privately held Clayco is a national design-build organization with a real estate component, he said. It operates on an integrated delivery model that includes in-house construction, architecture and even concrete divisions to pour its own panel and wall systems, which enhances its ability to complete projects quickly for its clients.

The company is one of the largest builders for Amazon, whose sorting facilities are about 850,000 square feet and employ 2,500 workers, he said. Other clients include S.C. Johnson & Son Inc., Lowe’s and Dick’s Sporting Goods, and the company is completing a 1.2 million-square-foot distribution center for Kohl’s in Columbus, he reported.

CRG’s initial plans are to spend an estimated $80 million to build the Cubes Logistics Center, Mercer County Commissioner Matt McConnell said as he and Penn-Northwest President Randy Seitz prepared to present the company with one of the New Industry Economic Impact Awards during the event. The center could create 300 to 600 full-time jobs.

That could just be the beginning, Caplan acknowledged. The total site can yield up to 2.4 million square feet of warehouse and fulfillment center space, Caplan said.

A standard 1 million-square foot warehouse has about 150 employees, he said. Employment for an e-commerce fulfillment center typically ranges between 1,000 and 1,500.

“We do not have an active tenant involved yet,” he reported. “We have had some inquiries but nothing that’s been taken to completion.”

Penn-Northwest also presented New Industry Economic Impact Awards to Rig Fab Energy Solutions, which provides professionals for the industrial, construction and power industries, and Moxietec, which has developed a new process for the plastics industry.

“New industry recruitment is all about lead generation and site visits,” Seitz said during the program. Penn-Northwest’s goal over the past year was to convince 20% of its prospects to participate in a site tour and 20% of those visitors to invest in the Mercer County community. The development corporation surpassed both metrics, he said.

A representative of another company being courted by Penn-Northwest was eager to join firms doing projects in Pennsylvania. Andre Bustamante, director of human resources for Coldfall Corp. in Houston, said his company is interested in acquiring one, or potentially both, of the recently constructed warehouses at Greenville-Reynolds Industrial Park.

The recycling company has a proprietary microwave technology that breaks down feedstock such as plastics, tires and coal into fuels such as jet and diesel fuel and acetylene gas. The company is looking to deploy the technology globally “but you have to start somewhere first,” Bustamante said.

Bustamante, who is from Cleveland, had looked for a site there but was unable to find a property over the past year that met his needs in one of the city’s Opportunity Zones. Six weeks ago, he and his team met with Penn-Northwest officials, who gathered representatives from FirstEnergy, the county commissioners and workforce development.

“We looked at some buildings and in that one day we found a home,” he said. “I brought my lucky pen to sign a lease, if you’re ready.”

The company’s local operation will begin by producing CBD oil from hemp stock, and then expand as it acquires the additional space it will need to recycle tires and plastics. “We’re talking about doing 18,000 tires a day, so the tires have to be sorted, we have to pull the belts out, we’ve got to shred them,” he said.

During the program, Penn-Northwest also presented Local Industry Economic Impact Awards to Zero Error Racing, an original equipment manufacturer of racing equipment; Lauren Technical Institute, which is now expanding its Hermitage facility; and Sharon Regional Medical Center, the county’s largest employer; and recognized Joseph George, chairman of Joy Cone Co. in Hermitage, with the Lifetime Achievement Award.

In addition, it recognized members of its Improvement Movement Team and the outgoing chairman, Doug Riley.

The Sharon Regional team remains “steadfast’ in its commitment to providing “the highest quality of advanced care services in this community close to home,” Joe Hugar, president and CEO, said.

“My staff and I don’t feel the community should have to travel to Erie, to Cleveland, to Pittsburgh for their health care needs,” he continued. “We will continue to do what we can to expand our programs, our services, and always first and foremost be sure that our quality of care is always what it should be for each and everyone here.”

Joseph George, chairman of Joy Cone Co.

David George, Joy Cone’s president, said the company has expanded from just one customer when his father took over the business in 1964 to being in virtually every grocery store in the United States and most stores in Canada when he retired a few years ago. The company now has more than 500 employees in the Shenango Valley.

“This would never have happened if he didn’t have the guts and the desire to live his dream,” he said.

He also said his father considers as his greatest achievement the fact that Joy has been able to provide so many people with jobs that pay good wages and offer “a fantastic retirement plan.

“If you spend a substantial amount of years at Joy you will make a decent wage, you will have good benefits and you will have a hell of a retirement program,” Joseph George affirmed. “I’m proud of that.”

Pictured above: W. Scott Caplan, senior vice president with CRG, describes the company’s plan for the 1 million-square-foot logistics center.

Copyright 2020 The Business Journal, Youngstown, Ohio.