Nestlé Joins Growing List of National and Multinational Companies Operating at the Tejon Ranch Commerce Center
Tejon Ranch Co. announced the construction of a new distribution center for Nestlé USA, Inc., the world’s largest food and beverage company. The 700,000 square feet multi-story building will be located on a 58-acre parcel of land on the east side of Tejon Ranch Commerce Center. Nestlé's new facility will serve its ambient portfolio and is expected to be completed by 2025. The decision to operate from the Tejon Ranch Commerce Center confirms its status as an established world-class commercial/industrial center.
The establishment of Nestlé's new distribution center at Tejon Ranch Commerce Center (TRCC) is a strategic move that aligns with broader trends in supply chain optimization. Given the center's location, Nestlé will benefit from improved distribution efficiency, particularly for the West Coast market. This development can be expected to enhance Nestlé's operational agility and potentially lead to cost savings through reduced transportation times and logistics optimization.
From an investment perspective, the expansion of TRCC and the addition of a major client like Nestlé underscore the center's attractiveness to leading companies. Investors should monitor the long-term impact on Tejon Ranch Co.'s revenue streams and property value growth. The announcement may also signal confidence in the region's commercial real estate market, suggesting an uptick in demand for industrial spaces that cater to advanced manufacturing and distribution.
Nestlé's investment in a new, fully automated facility at TRCC represents a notable capital expenditure with implications for its North American operations. The focus on automation is likely to drive long-term efficiency gains and support margin improvements. However, investors should consider the upfront costs and the timeline for return on investment, given that operations are set to commence in 2026.
Tejon Ranch Co.'s stock performance may be influenced by this transaction, as the sale of a 58-acre land parcel and the potential for future development could serve as catalysts for growth. The transaction details and the subsequent lease or sale agreements will be critical in assessing the direct financial impact on TRC's balance sheet and income statement.
The construction of Nestlé's distribution facility at TRCC has broader economic implications for Kern County and the surrounding region. The project not only contributes to local job creation but also attracts further investment into the area. This could have a multiplier effect, stimulating ancillary businesses and services. The economic vitality of the region is poised to benefit from the increased activity and the enhanced profile as a commercial hub.
Moreover, the development reflects a positive business climate and the effectiveness of local government incentives. The foreign trade zone designation mentioned provides tax advantages that can attract more companies to the area, potentially diversifying the local economy and fostering resilience against sector-specific downturns.
01/23/2024 - 04:15 PM
The Tejon Ranch Commerce Center continues its rapid growth as construction begins on a new distribution facility for the world’s largest food and beverage company
TEJON RANCH, Calif., Jan. 23, 2024 (GLOBE NEWSWIRE) -- Tejon Ranch Co . (NYSE: TRC) announced today that construction is underway on a new distribution center for Nestlé USA, Inc. , (Nestlé) the world’s largest food and beverage company with a robust U.S. footprint. The new multi-story building, which will be more than 700,000 square feet, will be located on an approximate 58-acre parcel of land on the east side of Tejon Ranch Commerce Center (TRCC).
Nestlé USA’s new, fully automated facility will serve its ambient portfolio and will be built with flexibility to support future growth and expansion plans. Though no official opening date has been announced, Nestlé is targeting 2025 for initial completion of construction and 2026 for commencement of operations.
“Nestlé is building a supply chain that’s fit for the future and able to drive long-term value for our business,” said Pete Spanos, Chief Supply Chain Officer of Nestlé North America. “Tejon Ranch is the ideal location for us to build our next-generation distribution center due to its central location that gives us an efficient route to market on the West Coast.”
“Given the breadth of Nestlé in the U.S. market, its decision to operate from the Tejon Ranch Commerce Center—as have other major companies like IKEA, Dollar General, Famous Footwear, Caterpillar, Camping World and L’Oréal—confirms TRCC’s status as an established world-class commercial/industrial center,” said Derek C. Abbott, Tejon Ranch Co.’s Executive Vice President of Real Estate.
More than 8 million square feet of commercial and industrial space at TRCC has already been absorbed, approximately 40% of the thriving development’s 20 million square feet of entitled space. In the last 24 months alone, there have been transactions involving four building sites at TRCC representing more than 2.5 million square feet of industrial space either under construction or completed.
“Nestle’s construction of this new facility builds on the velocity enjoyed at TRCC with nearly a million square feet of additional industrial development recently completed,” Abbott continued. “The activity is due to many factors, including TRCC’s high-quality workforce, its strategic location in the middle of California just north of the LA basin, a business-friendly local government offering a county-wide incentive program, a foreign trade zone designation for company financial benefits, and its significant on-site amenities. Even with all the space we’ve built, there are still significant opportunities to develop new buildings at TRCC to meet the strong demand we are seeing for warehouse, distribution, and advanced manufacturing facilities.”
The Tejon Ranch Commerce Center continues to be a driver of economic growth in Kern County and the surrounding region. To date, more than five thousand jobs have been created and hundreds of millions of dollars invested in this gateway between southern and northern California.
JLL’s Mac Hewett , Mike McCrary and Brent Weirick represented Tejon Ranch Co. in the 58-acre land sale transaction.
About Tejon Ranch Commerce Center Plant Prefab , an award-winning custom builder of high-quality multifamily and single-family housing.
About Tejon Ranch Co.
MEDIA CONTACT: media@tejonranch.com
Nestlé USA, Inc.lauren.rubbo@us.nestle.com
What company is constructing a new distribution center at Tejon Ranch Commerce Center?
Nestlé USA, Inc. is constructing a new distribution center at Tejon Ranch Commerce Center.
What is the size of the new distribution center being constructed at Tejon Ranch Commerce Center?
The new distribution center will be more than 700,000 square feet in size.
When is the targeted completion date for the new distribution center at Tejon Ranch Commerce Center?
Nestlé is targeting 2025 for the initial completion of construction and 2026 for the commencement of operations.
What is the significance of the decision by Nestlé to operate from the Tejon Ranch Commerce Center?
The decision confirms TRCC’s status as an established world-class commercial/industrial center.
Who represented Tejon Ranch Co. in the 58-acre land sale transaction?
JLL’s Mac Hewett, Mike McCrary, and Brent Weirick represented Tejon Ranch Co. in the land sale transaction.
