Chicago-based Boeing Co. and Kraft Foods unit Nabisco both have leased 100,000-plus-square-foot Orange County facilities, and each will consolidate some regional operations here.
Boeing is taking 112,000 square feet of space in Cypress for printing and document vaulting operations in a consolidation move it hopes will help it break into the Orange County detailed document production market in a commercial capacity in addition to handling its internal needs.
Nabisco is consolidating three Southland distribution facilities into a 102,361-square-foot distribution warehouse at ProLogis Park Mid-Counties in Buena Park.
Boeing will complete the move into its new space at 10800 Valley View St. by month-end. The firm is consolidating its document preparation and vaulting ops from two facilities in Long Beach and one in Huntington Beach. Boeing signed a five-year lease for the Cypress facility.
“We are making a commitment to the Cypress area,” said Earl Beauvais, director of business operations for Boeing’s Cypress facility. “Geographically this thing is very well situated for us,it’s ideal location-wise because it gives us quick access to all of Boeing’s facilities in Southern California.”
Half of the facility will be used to produce promotional documents, blueprints, technical publications and microfilm. The other half will be used for storage, vaulting and distribution. The building also will incorporate much of Boeing’s regional corporate library facilities.
The facility will store drawings and microfilm before they are issued to the company’s engineering area. The move will retain all 100 staff from the previous three printing and vaulting operations and will put them in 30% less space.
Company officials expect that staff count to remain static over the next year. Boeing Co. is OC’s second-largest private-sector employer.
“The facilities we support will include the facilities in Huntington Beach, Long Beach, Canoga Park, Anaheim and Seal Beach,” said Boeing regional spokeswoman Beth Leisner. “Also we’ll service Boeing Satellite Systems at the old Hughes operation in El Segundo.”
Leisner also said that the move attempts to create a hub-and-spoke system for distribution of Boeing’s information materials.
In addition, Los Angeles-based designer and printer Continental Graphics, a company acquired by Boeing last year, will use the production facilities and some office space at the new Cypress center to make its initial foray into OC. Continental’s current customer base is solely in LA and San Diego counties.
“They don’t have much of a presence in Orange County,” said Beauvais. “And their capabilities are very similar to the stuff that we’re putting out, so we’ve asked them to join us at the new facility to pool our core competencies to get commercial customers for our product lines.”
The move will enable Boeing to take care of and leverage off of its internal requirements and enable Continental to gain commercial access to the OC market.
“We’re looking to posture ourselves to do something a lot of companies aren’t able to do with their internal infrastructure,” Beauvais said.
“This will be a good experiment for us,” Beauvais said. “If we’re successful here, we hope to do this in other regions of the country.”
The Anaheim office of CB Richard Ellis brokered the lease deal.
Meanwhile, Nabisco’s 10-year lease agreement brings ProLogis Park Mid-Counties to 100% leased. Other major tenants at the park include Jack in the Box, Service Craft and Fairmont Designs.
Though financial terms on the lease were not disclosed, one industry source estimated the deal at 51 cents per square foot, triple-net. ProLogis was represented in-house while Fischer & Co., Dallas, represented Nabisco.
Nabisco will expand from a 62,000-square-foot distribution center in Compton and two smaller centers to the ProLogis property.
“We will shut down the Compton center and move over Oct. 26,” said Randy McKinley, the warehouse manager for the Nabisco center.
The move serves a dual purpose for the baked goods manufacturer: it consolidates the distribution efforts and puts them a stone’s throw from the company’s regional bakery.
“Nabisco has a very successful bakery just on the north side of the 5 Freeway,” said Steve Batchelor, a vice president with the Anaheim office of CB Richard Ellis. “It’s difficult to move a bakery, especially a successful one, so they negotiated to find a nearby distribution center.”
An existing lease agreement between ProLogis and Nabisco made the move a relatively easy one.
“We were able to utilize Nabisco’s standard ProLogis lease form, helping to make Nabisco’s lease negotiation and the move-in process quick and seamless,” said Larry Harmsen, first vice president for ProLogis.
In all, Nabisco and Kraft lease seven facilities totaling more than 1.9 million square feet from ProLogis.
For Nabisco, the move to the ProLogis site is a sort of homecoming. At one time, Kraft had a 450,000-square-foot processing plant on the 58-acre tract on Artesia Boulevard. Built in 1958, the building was torn down and the four-building, 1.2 million-square-foot ProLogis Park Mid Counties was developed in its place in two phases from 1997 to 1999, according to Pat Maloney, vice president for ProLogis. n
