Industrial brokerage service groups from CBRE’s Philadelphia and Central New Jersey offices along with Project Management, Labor Analytics, Cost Segregation and LJ Melody teamed up to arrange the consolidation, relocation, construction, and financing of Church & Dwight Co., Inc.’s new integrated laundry detergent manufacturing plant and distribution center in York County, PA. The complicated transaction, with a value estimated to exceed more than $170 million, used multiple facets of CBRE’s real estate services platform and consisted of the acquisition of a 232-acre site to accommodate an environmentally friendly, high-tech built-to-suit 1.1 million square foot facility.

Challenge

Church & Dwight Co. Inc. (C&D) is a manufacturer of a wide range of personal care, household and specialty products under the Arm & Hammer brand name and other well-known trademarks. Their business had grown substantially over the past ten years, both organically and through acquisitions. Working out of multiple locations throughout Central New Jersey, the company’s operations had become strained. As a result, C&D retained AlixPartners, a global restructuring, consulting, and financial advisory firm, to prepare a business strategy that would determine the cost benefits of consolidating these facilities into a single, new and modern plant in order to increase efficiency and profitability. C&D then enlisted the services of CB Richard Ellis to help locate a site to accommodate a brand new 1.1 million square foot facility to consolidate the entire company’s operations into one state-of-the-art, cost-effective and environmentally friendly facility that could be expandable to 1.9 million square feet in the future.

To properly assist C&D realize their transition goals, CBRE’s brokers needed to find a site that was properly zoned with access to major highways, industrial capacity utilities, a class ‘A’ railroad, a significant labor pool and in a business friendly environment. After this was accomplished, other challenges would need to be addressed that could further jeopardize the project included the managing of rising construction costs given the recent increases in steel, copper and petroleum manufactured goods as well as surcharges due to high fuel prices.

During this time, C&D was searching for new ways to produce a more environmentally friendly product. Their dedication to create new environmentally friendlier product lines would replace previous methods for manufacturing detergents which had used massive amounts of water resulting in a heavy and expensive-toship product. With fuel costs rising and the availability of reliable and safe water sources on the decline, the company needed to find a way to manufacture with less water and lower shipping costs.

Solution

After understanding the needs of C&D, who is best known to consumers as the manufacturers of over 200 brands of laundry detergent and related cleaning products, Senior Vice Presidents Joseph McDermott and Mindy Lissner began to scour the region for a site to house a large manufacturing and distribution facility with direct access to a class “A” railroad, industrial grade water, sewer, gas and electric with significant capacities to accommodate the production of their products, transportation infrastructure (for trucking), and an available labor force for the estimated 500 employees to staff the facility. A search across five states, including NJ, PA, MD, DE and WV, was narrowed to qualified sites in two states.

After careful negotiations, CBRE was able to receive a great deal of cooperation from local, county and state officials from the Commonwealth of Pennsylvania for site development, off-site improvements, building construction, permits, and incentives. A site controlled by First Industrial Realty Trust (NYSE: FR), a leading provider of industrial real estate supply chain solutions, was selected in Jackson Township, York County, PA which was logistically suitable and composed of 232 acres that will accommodate a 1.1 million square feet facility and with the ability to expand to 1.9 million square feet to meet future business needs. The Jackson Township site was only one of two sites proposed that could meet the necessary time frame, acreage, rail service, water capacity and other utilities to support the current and future plans of C&D.

Results

After a year-long search, C&D chose the York County site for its strategic location, available utilities and its proximity to major highways and railroads. The new site will allow them to continue to grow in a facility that can handle the current and anticipated additional base volume growth for their core businesses, support future potential acquisitions and position them among the industry leaders in efficient, low-cost production and distribution in the future.

The Jackson County facility will be LEED-certified and designed to significantly reduce production and distribution center costs, reflects C&D’s long-standing concern for the environment and their sustainability goals including a 30% reduction in energy consumption, a 50% reduction in solid waste and industrial effluent from manufacturing operations, and the use of renewable energy sources for on-site processing needs. The plans include several innovative conservation strategies, recommended by CBRE’s Project Management team, including energy efficient lighting, solar power, ventilation systems, roof design and the potential for rainwater collection from the 25-acre roof with intentions to use some of the water in the manufacturing process. The Project Management Team, lead by Managing Director James Carter, was one of the primary differentiators for the client to use CBRE along with our Cost Segregation, Labor Analytics and financing groups – offering the client confidence that CBRE was the most complete real estate services firm to help them achieve their goals.