The publicly traded company has taken 41,225 sf of class A space at 5360 Legacy Dr., one of three buildings in the retooled EDS campus, and across the street from its 300,000-sf headquarters building at 5301 Legacy Dr. in Legacy Business Park. In Victorville, CA, Dr. Pepper Snapple is going ahead with its former owner's $120-million plan to build a combo 550,000-sf distribution center and 300,000-sf manufacturing plant on 57 acres at the Southern California Logistics Airport.
Both deals were in the works as Dr. Pepper Snapple's executive team weighed candidates for the 13.5-million-sf corporate account, say CBRE senior vice president Seth Kelly and vice president Daniel Rudd, who pocketed the win. Rudd tells GlobeSt.com that roughly nine million sf of the portfolio is leased space, with Kelly noting it's predominately industrial stretching from East to West Coast and some stopping points in between along the Gulf Coast and western inland states. In all, there are 200 locations in the US, Canada, Mexico and the Caribbean.
CBRE's Dallas-based, six-member team includes Nick Tansey, a senior vice president in Memphis where CBRE has its lease administration hub for the region. The corporate account, as would be expected, was a sought-after assignment that in all likelihood included Cadbury Schweppes' long-time holder, Cushman & Wakefield Inc. [IMGCAP(2)]"We know they looked at several other groups," Rudd says, adding the decision-making spanned "three or four" months. The multi-year deal involves transaction management and lease administration.
Rudd says most of the industrial and office mix has been inherited during three years of company acquisitions. Kelly explains the team's role will "be a rationalization" of what can stay, go or be consolidated.
"The real estate footprint is totally going to be something with an optimized supply chain," Kelly stresses. "And transportation costs are a key driver today and will be looked at as it relates to where their facilities are located." The goal is to have strategic recommendations for the corporate team within six months.
The approach will be "expiration-driven," according to Kelly. An estimated 40% of the portfolio's leases roll in the next three years.
Kelly says the contract win is doubly sweet because Dr. Pepper Snapple's decision-makers are in the team's backyard. "This is a great opportunity for us because we have such a strong base in Dallas and it's great that their headquarters is here," he adds.
Dr. Pepper Snapple's SoCal project could be a sign of the future. The combo facility will be built in an 8,500-acre logistics park with an intermodal yard, opening the door for a single point of distribution to California and parts of the Southwest. The "western hub" will employ 200 workers. Construction starts in October, with the ribbon-cutting slated for early 2010. The plant will have the capacity to produce 40 million cases of product annually and serve nearly 20% of the US population.
Dr. Pepper Snapple has a 20,000-member workforce. There are 24 bottling and manufacturing facilities and more than 200 distribution centers in the portfolio.
Grant Dinsmore, vice president of sales operations for Dr. Pepper Snapple, says in a press release that asset management and developing strategic direction are chief considerations. With CBRE at the helm, "they will be an important partner as we transform the management of our real estate portfolio to improve operational efficiencies," he says.
Want to continue reading?
Become a Free ALM Digital Reader.
Once you are an ALM Digital Member, you’ll receive:
- Breaking commercial real estate news and analysis, on-site and via our newsletters and custom alerts
- Educational webcasts, white papers, and ebooks from industry thought leaders
- Critical coverage of the property casualty insurance and financial advisory markets on our other ALM sites, PropertyCasualty360 and ThinkAdvisor
Already have an account? Sign In Now
*May exclude premium content© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.
