Updated with comments from company executives: Plastics housewares company Sterilite Corp. is proposing to build a large manufacturing and distribution center in Davenport, Iowa.
The firm is eyeing a 2.5 million-square-foot building that would cost about $73 million for the building and land purchase. The project would create 500 jobs within five years with initial employment pegged at 150.
Davenport's city council plans to vote on tax incentives for the project this week. And other local and state agencies also need to sign off on the incentives. City officials had been studying the proposal for about six months.
Peter Stone, a Sterilite executive and grandson of the firm's founder, told a Jan. 4 council meeting that the Midwest location, local infrastructure and an educated workforce were among the attractions of Davenport. Also key was that land in the Eastern Iowa Industrial Center was ready for development.
“Having a shovel-ready site that was all set up and ready to hit the ground running should it be the right fit was very helpful and not something we saw in [every other] state,” Stone said.
Several incentive programs are being tapped for Sterilite's Iowa project, according to local news reports. They include a $3 million forgiveable loan, a $1.8-million rail spur and other infrastructure improvements worth $4.6 million, and partial rebate of property taxes worth about $8.3 million.
Stone touted his company's reliance on U.S production as a marketing advantage.
“Sterilite is an American-made company,” he said. “Every product made by Sterilite is made here in the United States.”
Sterilite is the largest plastics housewares company in North America. Headquartered in Townsend, Mass., the firm also has operations in Alabama, Arizona, Ohio, South Carolina and Texas. It was founded in 1939 by Saul and Edward Stone and Earl Tupper, originally to make heels for women's shoes. Sterilite entered plastic housewares in the 1960s.
Sterilite's most recently built plants are in Ennis, Texas, and Clinton, S.C.
Ennis was Sterilite's most recent expansion, a $17 million warehouse and distribution center added to its existing 2.1-million-square-foot production plant. Finishing touches are now being made on the addition, according to HWH Group of Paris, Texas, the company that built the Ennis plant and helped in site location. Forty new jobs there qualify Sterilite for a city tax abatement, economic development grant support and a $750,000 grant from the Texas Capital Fund.
In Clinton, Sterilite built a 2.4-million-square-foot production plant and distribution facility in 2004. That operation represented an investment of about $65 million.
Sterilite's Massillon, Ohio, injection molding plant was built in 1996. The 476,000-square-foot plant joined then-existing Sterilite molding operations in Townsend; Lake Havasu City, Ariz., and Birmingham, Ala.
Sterilite has grown in a crowded housewares market by emphasizing quality, manufacturing efficiency and sharp pricing strategies. By 2014, its employment reached about 2,000, according to government records.
The housewares market is so crowded that one of the early pioneers, Newell Brands Inc., is shopping for a buyer of its food container business. Newell's strategy in the container market is shifting to acquisition of a modern, highly automated molding plant recently built by Sistema Plastics in Auckland, New Zealand.
Sterilite's Davenport plant will be the city's largest building when it opens in early 2018. The construction site is a 160-acre plot.
“Five hundred new jobs in the community is always impactful,” Davenport Mayor Frank Klipsch said in a Jan. 3 media event. He indicated Davenport's skilled workforce is a key component in Sterilite's deliberations. Construction of the new factory is in line with the area governments' urban renewal efforts. About 400 of the new Sterilite jobs would pay between $12 to $16 per hour, with most of the rest paying about $18.75 per hour or more.
Davenport's population of about 100,000 makes it the third largest city in Iowa. It is located about halfway between Chicago and Des Moines, Iowa. Manufacturing is its major employer, with more than 7,600 jobs. The city touts its fast-growing high-tech sector. Agricultural equipment icon Deere & Co. is a major employer.
Sterilite also made a big impact in its hometown several years ago. In 2009 the firm's chairman, Albert Stone, financed a large library and community center in Townsend that cost as much as $20 million.
Plastics News estimated Sterilite's injection molding sales at $190 million.