Company outgrows building. Company buys land. Company builds new facility. End of story.
Most business expansions follow that simple progression. But after GloryBee Foods Co., a natural foods distributor based in west Eugene, searched in vain for years for a new site, the longtime local company became an accidental developer, not just of its own facility, but of an entire business park.
“We weren’t looking to develop a business park,” said Alan Turanski, GloryBee’s operations manager and the 30-year-old son of company founders Dick and Pat Turanski. “Our money is all sunk into GloryBee. It’s not sitting out there waiting for an (investment) opportunity.”
In 2006, GloryBee bought about 60 acres off Awbrey Lane, near the Eugene Airport, knowing that it wanted to keep only about 15 acres for its own operations, and would need to subdivide and sell off the rest.
GloryBee was committed to making its own facility environmentally sensitive and energy efficient, with such features as maximum natural lighting, operable windows for ventilation, solar panels to generate electricity and to heat water, and a system to use waste heat from coolers in the cold storage area to heat water.
With the growing national and local interest in sustainable building and business practices, GloryBee figured that other companies would want to join GloryBee in a business park where each building met goals, such as sourcing at least 35 percent of its electricity from renewable sources, and exceeded city code requirements for energy and water efficiency by at least 20 percent.
Turanski announced GloryBee’s ambitious plans in April 2007 with hopes of breaking ground that summer on the new GloryBee facility and moving in by 2008. Now, with a better understanding of the project’s scope and the many steps required by the city of Eugene before GloryBee can even start moving earth out at the site, the company is aiming to break ground next year and to complete the project in 2010.
This has been “a learning process,” Turanski said in a recent interview in the cramped office he shares with two other people at GloryBee’s headquarters at 120 N. Seneca Road.
“Our understanding of the project is just a lot different than it was before,” he said, adding that it isn’t just about building a new home for GloryBee.
“This is a community project,” he said, “meaning we need community support for it to happen, and I think there’s growing community support and that’s positive.”
The Turanskis have different motives for creating the park than typical developers of industrial subdivisions.
“We’re not profiting from this; we’re investing in it,” Turanski said. “The profit will be in living in that building.
“The satisfaction is going to come from a different place,” he continued.“It won’t even come from selling off all the lots. It will come from moving into the building and seeing the park be a benefit to the community.
The result, GloryBee hopes, will be a distinctive industrial development that reflects the company’s values and ideals of supporting local food production and reducing environmental impact, and helps other businesses achieve the same.
The positive side for GloryBee taking on the role of developer is that “they can basically create a setting, or a neighborhood, by design to complement what they’re doing,” said Jeff Elder, the Eugene real estate broker who will be working with GloryBee to start selling lots in the park early next year.
The downside, he added, is that “there’s probably no monetary gain from it all because of the task at hand of dividing it up and selling it.”
GloryBee paid about $1.8 million for the 60 acres and plans to spend $1.5 million to design the park and pay for its roads and other infrastructure, Turanski said.
GloryBee is a part of a growing trend in sustainable development, said Galen Ohmart, a principal architect at Solarc Architecture and Engineering Inc., the Eugene firm that designed GloryBee’s new building and prepared the park’s convenants, conditions and restrictions.
“They’re leaders in this community,” he said. “They’re out in front, but they’re out in front with others (in Oregon). I think that’s an exciting thing because that’s what’s going to make other parks like this viable.”
Solarc also is working on Verde Village, an 80-unit housing development in Ashland, which incorporates “green” features, such as radiant floor heating tied to a geothermal source, solar water heating and rooftop photovoltaic panels. Pringle Creek Community, a 32-acre residential community in Salem, is another example of sustainable development. The development of houses, retail and work spaces, parks and community facilities is taking shape on part of the former Fairview Training Center campus, a state institution for people with developmental disabilities until it closed in 2000.
“Having a sustainable business park (in Eugene) is just a great opportunity for this community,” said Mike McKenzie-Bahr, Lane County’s community and economic development coordinator.
There’s a synergy when like-minded businesses locate together, he said. Companies in the park will be able to share expertise, and that can ripple through the greater community, McKenzie-Bahr said.
The road GloryBee chose to go down hasn’t been easy.
There’s a reason why more business owners don’t try to develop business parks, Turanski said.
“It takes a lot of time,” he said. “It seems unfortunate that that needs to be the reality. We’ve got a business to run here. So you need agents that can do this for you.”
Turanski said it took a while to assemble the right team of experts, which includes Solarc, Branch Engineering, based in Springfield, and Satre Associates, based in Eugene.
Then there’s the never-ending to-do list for a project of this size and complexity.
There were a dozen acres of wetlands to mitigate or preserve, plans to draft for GloryBee’s own $14 million, 120,000-square-foot facility, and for storm water and landscaping in the park, and covenants, conditions and restrictions to create in order to regulate park tenants.
GloryBee soon will file its application with the city for subdivision approval. Securing that approval takes at least eight months, and involves public notice and the OK of the city planning director.
GloryBee’s site does have some development challenges, said Shawna Adams, an associate planner with the city planning division.
The land is in Eugene’s urban growth boundary, but outside the city limits. So, public infrastructure, such as water and sewer lines, is not immediately available, she said.
Also, a city-protected waterway runs through the site, which may prompt an additional natural resources standards review, Adams said.
“GloryBee is working with the city to identify and resolve those development challenges, and we’re confident that we’ll see a solid proposal in the near future that will address” city rules, she said. “There’s nothing fundamental that suggests that subdivision approval for this site is unfeasible.”
Financing the development is an ongoing challenge. GloryBee is eager to obtain subdivision approval so it can begin selling the nine lots, ranging from two acres to eight acres. The company will also seek out incentives, such as Clean Tech Cluster development grants through the state economic and community development department to help with the costs.
“We’re still in a situation where we need to sell some of those lots to get our project moving and to finish development of the park infrastructure,” Turanski said.
To pay for consultants, permits and park infrastructure development, GloryBee is tapping into money it had set aside for its new building, he said.
One help to the project’s ledger is that the city and Lane County, joint sponsors of the west Eugene Enterprise Zone, approved GloryBee’s request to expand the zone boundary to include the business park property. GloryBee and other property owners in the park will be eligible for property tax waivers on new buildings and equipment. GloryBee stands to save $300,000 a year for three years in property taxes on its $14 million project and can use enterprise zone eligibility as a sales draw for lot buyers.
GloryBee started talking about needing a new facility in fall 2002, Turanski said. “We didn’t imagine it was going to take this long, for sure.”
Instead of dwelling on the delays, however, Turanski is looking ahead. “To me, things are kind of starting all over right now,” he said.
The delay has put a damper on GloryBee’s efficiency and growth. The company operates out of 88,000 square feet in five sites, Turanski said.
GloryBee’s business is doing well — annual growth has topped 15 percent for each of the past five years — he said. The company doesn’t release revenue figures. But “we have a lot of opportunities as a company that we can’t capitalize” because the company doesn’t have the room, Turanski said.
The wait makes Turanski wonder if his business park has missed out on potential tenants.
Toby’s Family Foods, which bought Genesis Juice and now produces the juices in addition to its own salad dressings and tofu dips, and Turtle Mountain, a maker of soy frozen confections, recently expanded on Shelley Street in Springfield.
But the biggest drawback of the delay is simply that GloryBee’s 133 employees are still not united at one facility, Turanski said.
Those drawbacks aside, “I don’t really see a lot of cons today,” he said. “I would probably see more cons if it continues to drag out, or if the progress keeps hitting significant roadblocks.”
