A massive resin distribution center being built in the Chicago area will add 30-50 jobs when it opens with the potential of up to 150 more.
At the same time, the Coal City, Ill., site will allow its main client, resin distributor M. Holland Co., to improve its handling operations and potentially serve as a secondary export hub for the growing polyethylene production base in the U.S.
Northbrook, Ill.-based M. Holland will use the 400,000-square-foot facility, about 60 miles southwest of Chicago. It's being built by G&D Hoffman Transportation of Channahon, Ill. Major Prime Plastics Inc. of Villa Park, Ill., will provide logistics services for the site. Both of those firms have worked with M. Holland for more than 30 years.
The center will include paved access for nearly 700 rail cars and a fleet of bulk trucks. Services will include warehousing, bulk transfer and packaging. The project will give M. Holland access to direct rail service from three rail providers — Union Pacific, Burlington Northern-Santa Fe and Canadian National — for service to domestic and international markets.
"We're undergoing a total transformation of our warehousing and logistics," president and CEO Ed Holland said in an April 25 phone interview. "We need a lot of capabilities — everything from rail to packaging to bag-outs and computer access."
Over the last 18 months, M. Holland has reduced its number of stocking locations from 140 to about 45, including 15 that have "gold standard" ratings from the firm.
"If you have too many sites, it's impossible to keep the right materials in the right place at the right time," Ed Holland said. Reducing the number of stocking sites will allow M. Holland to serve its customers better, he added.
G&D will spend $20 million on the project, which is expected to open in January 2018. Vice President Jordan Hoffman said in an April 26 phone interview that the new distribution center "really opens doors for us and gives us flexibility.
"This is the biggest project we've ever been involved in," he added. "We've had a great partnership with M. Holland and Major Prime. We've got deep roots with them."
The site should create 30-50 new jobs at first, Hoffman said, with the possibility of adding 75-150 more in the first 3-5 years of operation.
Coal City was chosen because of its proximity to some of the largest intermodal yards in the world, officials said in a news release. The location provides efficient access to all major U.S. ports for import and export opportunities. M. Holland expects "a significant improvement in rail transit times" when the new facility is operational in January, officials added.
Coal City's location also allows rail traffic to avoid most of Chicago's rail grid, which can slow down deliveries. Hoffman said that avoiding Chicago rail traffic could reduce delivery times by 10-14 days.
"We have been working to develop long-term, strategic relationships with third-party logistics partners for several years," Pete Nutley, M. Holland operations vice president, said in the release. "This is the finalization of our national warehousing strategy."
"The one-stop shop facility will drive growth through the alignment of supply with all transportation modes, logistics and speed to market," added Brandon Kearns, vice president of Major Prime.
The oncoming addition of billions of pounds of new North American polyethylene resin capacity — a result of newfound shale gas feedstock — "helped accelerate the timing" of the project, Ed Holland said. But he added that some type of new facility "was going to happen either way."
Hoffman said that the timing of the new project coinciding with new PE capacity "couldn't be more perfect."
"This project is intended for domestic distribution, but it could be a secondary export hub once the [Gulf Coast] gets maxed out," he added.
M. Holland is one of North America's largest resin distributors, supplying more than 1.4 billion pounds of resin annually to more than 4,000 customers.