Building partnerships

Rich Kramer of Rich Kramer Construction officially closed on a $218,000 deal Jan. 27 with the Springfield Partnership for Economic Development to buy 6.25 acres in the west-side industrial park. Kramer plans to build a new facility that could cost more than $4 million for his company’s cabinet manufacturing division, Cabinets by RKC.

Kramer’s purchase leaves approximately 350 acres of developable land available in the west center, priced at $35,000 per acre for land without rail access and $40,000 per acre for land with access to the railway.

Karl Plumpe, director of economic development with City Utilities and a member of the park’s administrative council, said once expansion gets going in a large development like PIC, it can have a snowball effect.

“Whenever you have a project that gets under way it can definitely serve as a catalyst for further development,” Plumpe said. “We saw that in the east park as well in the early stages. Once you get momentum built, it can create the impetus for more development.”

Meanwhile, tenant expansion at the original Partnership Industrial Center will nearly max out its available space on East Kearney.

“There’s only one lot on which we do not have continuing negotiations,” Plumpe said. “We’ve got one lot that somebody has an option on, there’s another one we’re closing on – Stainless Technologies – and then we’ve got Diesel Exchange (that) has an option on the piece of land next to them. So, we really only have a seven-acre parcel of usable land left that’s not in current negotiations in the east park.”

Stainless Technology, a division of ABEC Inc., is adding to its operation less than a year after opening. Its current facility, which opened in April, covers more than 30,000 square feet.

“We’re going into our second phase (of development),” said plant manager Craig Burrell. “We’re expanding to our south another 20,000 square feet. We’ve signed a letter of intent and the building’s been ordered.”

Burrell expects the company will hire at least 10 employees as a result of the expansion, which should be complete in July. The facility employs 52.

Digital Monitoring Products is another PIC tenant in expansion mode.

“We’re increasing plant space and office space,” said Kirk Evans, chief financial officer. “There is physical plant expansion planned, and we hope to start about the first of April; it should probably take about five months.”

Evans said his company, which employs about 120 and hopes to add about 20 more with the new expansion, gets unique advantages from being in the industrial center.

“Just the economic aspect, physically having a plant in an enterprise zone, provides tax credits,” Evans said. “From the tenant standpoint, you have other people that you can call to talk to, exchange information with and things like that. I think it’s like a neighborhood of companies, and you can gain peer groups from being out here.”

NorthStar Battery is finishing a 60,000-square-foot expansion to its PIC location. Vice President of Operations Joel Gibson said the company employs 200 and is probably going to hold steady at that level.

“It all depends on customer demand and the order quantities that come in,” he said. “We try not to add too many; we really want to be stable. We’re usually fairly cautious about bringing on manpower, because we want to be sure there’s a good steady base there to support that manpower.”

Gibson said the PIC has several factors working in its favor.

“The industrial center is one of the better industrial parks nationwide in my opinion,” he said. “The primary issue that you run into with some centers is there’s not a good handshake between the city and whoever is developing the park, and in this case, CU is involved, the city of Springfield, Springfield Business Development Corp. and the (Springfield Area) Chamber of Commerce were all part of this park, and that makes for a very business-aggressive atmosphere. They really are business friendly in Springfield.”

Kramer said cost and location were the factors that lured him to PIC West.

“The location is good; there’s easy access,” he said. “The value of the Partnership Industrial Center ground is tremendous. What you get for your dollar is a tremendous deal, which is the city’s way of thanking a manufacturer for growing. I mean, it’s $35,000 an acre for industrial ground that is fully developed.”

Kramer said construction of his new facility should begin immediately, with estimated completion in August or September.

He added that there is the possibility of continued expansion for the 75,000-square-foot facility in the future. Kramer will join the park’s two tenants, Executive Coach Builders and Stamina Products, who together employ about 175.

Ripple effect

Plumpe said the continued growth of the two centers has an important ripple effect for the rest of the area.

“(It’s) the multiplicative effect,” he said. “When manufacturing comes in, supporting employment opportunities grow then, too. Every time there’s a manufacturer, you’ve got those companies that have to service those machines and service those industrial plants. Plus, construction costs on manufacturing (facilities) are good as well, so its good for construction business.”

Plumpe added that the pay levels at most of the businesses in the center are attractive.

“There are some places that’ll start at $12 (an hour) and go up to $20 in a year,” he said. “On average, it’s probably about $13 an hour overall throughout the park.”

Evans said the continued expansion is a good sign.

“I think it’s an overall sign that economic conditions are definitely improving, and maybe even specifically manufacturing is recovering and improving overall,” he said.

The original partnership center, near the Interstate 44 and Highway 65 intersection, opened in 1994 as a result of an H.P.S.S. Fantus study that said the city of Springfield was lacking in both the quality and quantity of industrial facilities. The east center employs more than 2,000 between 20 tenant companies.

Partnership Industrial Center West, on West Kearney Street, east of the airport, was created in 2001.