Pitman-Moore Inc., an international animal health and nutrition company, announced today that it has signed a seven-year lease for the vacant shell building in the East Hills Business Park.
L.J. Bair, western distribution manager for the Mundelein, Ill.-based company, made the announcement during a press conference this morning at the Lawrence Chamber of Commerce offices.
Bair said the company planned to relocate its Kansas City, Mo., distribution center to the 81,000-square-foot East Hills building. The center initially will employ 16 people, although the company is holding out the possibility of expanding the center within the next few years.
Bair said the lease, which was signed Friday, also contains options for two five-year extensions.
Chamber President Gary Toebben said the financial terms of the lease would not be disclosed.
THE LAWRENCE center, which will supply all six of the company's domestic veterinary prescription product distribution centers, also will serve as its distribution center for North American exports.
The company's products, which number more than 1,000, range from livestock feed supplements to veterinary pharmaceuticals, such as vaccines and test kits for feline leukemia, heartworm and canine Lyme disease. In addition, Pitman-Moore is the exclusive distributor for veterinary surgical supplies manufactured by Johnson & Johnson.
The company, which is one of three subsidiaries of IMCERA Group Inc., reported 1991 net sales of $622.9 million, up 7 percent from the previous year. Its operating earnings last year were $74 million, an increase of 33 percent from 1990.
OFFICIALS of the local chamber and Douglas County Development Inc., the public-private coalition that is developing East Hills, a 300-acre park on the eastern edge of Lawrence, applauded the announcement.
"Lawrence, Kansas, is very much going to be on the world map with respect to animal health," said Bob Johnson Sr., DCDI's president.
City officials, who also attended this morning's press conference, also were pleased by the announcement.
"It's a fantastic thing to have the shell building occupied by such a fantastic company, whose reputation precedes them," said Mayor Bob Walters.
Pitman-Moore will be the third building to locate at East Hills, joining The Garage Door Group and Kinedyne Inc., which built plants there in 1989 and 1990, respectively.
The Pitman-Moore lease also fills the vacant shell building, which was constructed on speculation two years ago and financed by 24 local investors and six financial institutions.
DCDI HAD hoped to sell the building outright, but Bair said today that the development group's willingness to lease the building, which has room for expansion, made the site attractive to Pitman-Moore.
"This was one of the few in Kansas City and the surrounding area that had that capability," Bair said.
He noted that the company had contemplated building a new distribution center on property it already owned in the Kansas City area but never had seriously considered building on other sites.
Although Bair said Pitman-Moore considered three or four other locations over the past 18 months, the company never entered into negotiations for those sites, and the shell building apparently did not have any serious competition.
"We had others that were possibles in the event this didn't work out," he said.
INTENSE lease negotiations delayed the announcement, which initially had been expected to come in November. However, Toebben said the company planned to adhere to its timetable of being moved into the building by April 1.
Terms of the lease call for substantial completion of the warehouse's interior finish work by March 31, Toebben said.
"We're able to meet that deadline because Pitman-Moore, even prior to the signing of the lease made some commitments that allowed us to proceed with the engineering and design work," Toebben said.
Harris Construction is the general contractor on that portion of the project, which is being financed by five local banks. Toebben said the interior work is expected to cost $735,000.
The signing of the lease will allow Pitman-Moore and DCDI officials to pursue of property tax abatements for the distribution center.
LATE LAST year DCDI filed an initial application for an abatement of 50 percent for 10 years on the land and building, and the city commission twice scheduled public hearings on the request. However, because the hearings could not be held until the lease was signed, those hearings were canceled as the lease signing repeatedly was delayed.
Bair said today that the company also would ask the city for a 50 percent tax abatement on equipment.
City Manager Mike Wildgen, who attended this morning's press conference, said he couldn't say when a hearing would be held but added, "It will be quickly."
Chamber officials have said that part of the delay in getting the lease signed was caused by the inclusion in this original lease of provisions for a possible expansion at the site within the next few years.
However, Bair, who said the East Hills location would allow the company to double the size of the Lawrence center, declined to say when the company would make a decision about increasing its Lawrence operations.
"WE HOPE in the future to expand but that's going to depend on future growth of the company," Bair said.
In addition to year-to-year sales growth, Bair said the company doubled its product line in 1989 through the acquisition of Coopers Animal Health, another veterinary product manufacturer.
The company expects net sales to reach $1 billion by 1995. It currently has distribution capability in 90 countries and offices and facilities in 30.
Pitman-Moore has 35 new products under development and expects during the next three to five years to increase its international sales through the approval for 280 cross-registrations to sell existing products in other countries.
The distribution center that will be replaced by the Lawrence facility is located in the Hunt Midwest Underground caves south of Worlds of Fun at Interstate 435 and Missouri Highway 210 in Kansas City, Mo.