OVERVIEW
One of the largest privately-held snack food manufacturers United States recently found itself challenged by two things many successful food-grade enterprises are currently dealing with—capacity planning and portfolio optimization & expansion. As supply-chain issues continue, and corporate real estate markets remain in constant fluctuation, even well-established, recognized industry leaders are facing new challenges to maintaining and growing market share.
While the company identified one quickly approaching challenge that needed an immediate solution, it wasn’t long before they realized the need for a holistic, forward-thinking approach to managing their entire portfolio—and plans for expansion—to avoid future disruptions.
Since beginning our work together, our client’s portfolio has grown to 500,000 square feet of industrial real estate, and their annual revenue has climbed from $60M to $100M+.
CLIENT SCENARIO
As a leader in the snack food industry, our client maintains a large footprint of industrial facilities and warehouse space. But, with supply chain bottlenecks often forcing companies to hold onto greater inventory to account for longer than usual restocking times, our client suddenly realized that there was an oncoming problem heading straight toward them. Shipping containers of perishable, refrigerated goods were en-route and scheduled to arrive at one of their facilities in Southern California in only 20 days, but there was no available refrigerated space to unload them.
With the availability of move-in-ready food-grade industrial space at an all-time low in the Los Angeles MSA area, the company’s leadership team quickly turned to DEODATE to help them find a space for their shipment. After successfully doing so, our new partnership would reveal a number of other pressing matters as well as time-sensitive growth opportunities that would provide our client with an even stronger ROI.
CHALLENGES
Navigating through unpredictability around current supply chain issues | Lack of understanding of available incentives and credits in new markets |
Strategies needed for local and national growth targets | A need to restructure $60M in real estate debt |
SOLUTION
After learning of our client’s production facility capacity challenges, our team at DEODATE quickly got to work. Where many brokerages would stop at simply identifying listed spaces and current asking prices in a target area, we were able to quickly negotiate a sublease in a refrigerated facility right next door to one of our client’s existing properties. Identifying the perfect space, and working on behalf of our client throughout the financing, negotiation, and signing processes were all completed within a 20-day period, and our client was able to receive their much-needed inventory.
After solving this challenge, our client asked that our DEODATE team become part of their own, in order to be able to provide additional guidance and expertise around a number of initiatives involving their current portfolio of properties, and ambitious growth plans for the future. This work would include portfolio optimization and helping the company structure $60M in real estate debt, as well as identifying available deal incentives and tax credits for their local and national expansion initiatives.
Contact us today to inquire as to how these results were achieved, and how similar, tailored strategies may assist your organization's initiatives.