News Article | 8/1/2008

Dr Pepper consolidates in Jacksonville

WESTSIDE — Dr Pepper Snapple Group Inc. is consolidating all its Southeast noncarbonated distribution facilities into one 601,500-square-foot space in Jacksonville.

The company will distribute its noncarbonated products such as Snapple, Hawaiian Punch and Mott’s brands throughout the Southeast from space leased in the West Point Trade Center, which is being developed by Dallas-based Hillwood Investment Properties.

“This is an important step toward strengthening our distribution in the southeastern United States,” said Dan Flowers, senior vice president of logistics and distribution for Dr Pepper Snapple Group.

“This facility will enable Dr Pepper Snapple to get our Snapple and Mott’s brands to our customers and consumers more efficiently and will lay the foundation for future growth in the southeastern region.”

The company is consolidating its noncarbonated facilities in the U.S. and Canada into fewer regional facilities that total as much, if not more space, Flowers said. Currently the Southeast distribution facilities are located in several buildings totaling about 500,000 square feet. Flowers would not disclose their locations.

The space on Pickettville Road that was originally speculative space is expected to be ready by the first quarter of 2009.

“The timing was fortunate for both parties,” said Preston Herold, vice president of Hillwood Investment Properties. “For Dr Pepper Snapple, catching us in the early stages of the building design allowed us to design in specific improvements to maximize the logistical efficiency of the facility for them. For Hillwood, it means we can leverage off this success and immediately start on our next Jacksonville development, which we hope to announce shortly.”

Herold said Dr Pepper Snapple surveyed several sites in the Jacksonville area before choosing the Hillwood property because of its proximity to its manufacturing facility that makes Snapple, Hawaiian Punch and carbonated beverages on Bowdendale Avenue on the Southside as well as its proximity to major interstates. Dr Pepper Snapple signed a 10-year lease for the property.

“It’s not every day that you have the opportunity to lease an entire 601,500-square-foot speculative building before the slab is even poured,” Herold said.

More than 50 beverages

Dr Pepper Snapple Group (NYSE: DPS), based in Plano, Texas, markets more than 50 beverage brands that include not only Dr Pepper and Snapple, but also 7UP, Mott’s, A&W, Sunkist Soda, Hawaiian Punch, Canada Dry, Schweppes, Squirt, RC Cola, Diet Rite, Penafiel, Rose’s, Yoo-hoo, Clamato and Mr & Mrs T Mixers. The company employs 20,000 people and operates 24 bottling and manufacturing facilities, including one in Jacksonville and one in Miami, and more than 200 distribution centers across the U.S., Canada, Mexico and the Caribbean.

Commercial real estate developer Hillwood has either developed or bought three buildings, totaling more than 1.3 million square feet, in the Jacksonville market in the past two years. In addition to West Point Trade Center, the company developed a 400,000-square-foot build-to-suit distribution center for Laney & Duke on Presidents Court in 2007 and bought a 361,000-square-foot facility on Faye Road in 2006.

Terry Quarterman and Jeff Nelson of CB Richard Ellis helped Herold represent Hillwood in the deal and Jim Brice and David S. Parker of Holt Lunsford Commercial and Seth Kelly of CB Richard Ellis represented the soft drink company.

The new facility, which is expected to open in the first quarter of 2009, will employ 40 workers.