News Article | 7/17/2004

Conair To Build Facility In Southaven

Memphis Commercial Appeal07/17/04

CONAIR TO BUILD FACILITY IN SOUTHAVEN Distribution center to bring 30-50 jobs in ’05

By Kate Miller MortonEast Windsor, N.J.-based Conair will open a new Southaven distribution center in January that will employ between 30 and 50 workers. The manufacturer of personal care and consumer products has contracted with Dallas-based Hillwood to build a 389,300-square-foot distribution center in Hillwood’s DeSoto Trade Center industrial park in Southaven.Conair plans to purchase the building and 38 acres when the facility is complete. The site is big enough to accommodate an additional 400,000 square feet. Conair owns and operates two distribution centers in East Windsor and Phoenix. Richard Margulies, vice president and general counsel for Conair Corp., said the company wanted to open a facility in a more central location, to save money and better serve some of its key accounts including Wal-Mart. “(The Southaven site) is centrally located so you have freight savings and you are able to better service some of your big customers that are close by,” he said. Conair imports most of its products, so Hillwood’s ongoing efforts to establish a foreign trade zone on the site was another attraction. Foreign trade zones are secure areas designated by the U.S. Department of Commerce as outside the territory of U.S. Customs. Scott Taylor, an attorney with Kansas City, Mo.-based law firm Miller & Co. PC, is helping Hillwood get its application approved and has worked on many other FTZs. Taylor said foreign trade zones offer distribution operations savings in two key areas: time and money. Because foreign shipments destined for FTZs don’t go through customs, they can pass directly through a border for delivery 24 hours a day, seven days a week. Because they don’t go through customs, they aren’t subject to customs duties. Only when the product is shipped to a domestic site, either by itself or as part of another product, is duty leveraged. Companies don’t pay duties on products exported from FTZs and they don’t have to pay duties on damaged goods that are never used. Conair’s other two domestic distribution centers are in foreign trade zones. There are about 260 general purpose FTZs in the United States, but each zone can have multiple sites tied to it. Approval of Hillwood’s application from the Commerce Department isn’t expected until late this year, but Hillwood is clearly already benefiting from the program. “It’s a successful project before it’s even approved because the idea is to attract these types of companies that will bring these types of jobs and significant investment to the area,” Taylor said. The Conair building will be the second in the DeSoto Trade Center. Hillwood completed an 846,066-square-foot spec building last October. St. Louis-based Emerson Motors has leased 365,000 square feet, and the rest remains vacant. The two buildings will complete the first phase of the project, which includes the 93 acres the company owns. Hillwood plans to exercise its option on an adjacent 125 acres, where it will eventually develop 2 million square feet of industrial real estate. Hillwood marketing director Preston Herold said the company would move forward with another speculative building only when its first facility is closer to being fully leased, though it may begin grading an additional site soon. Dan Wilkinson of Colliers Wilkinson Snowden and Richie Burnette of The Burnette Co. represented Hillwood. Andy Cates of Colliers Wilkinson and Snowden and Jim Belcher of Philadelphia-based Hart Corp. represented Conair. – Kate Miller Morton: 529-2351