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BCR's Daily Fishwrap Report for March 31, 2009

Burt's Bees could move downtown to American Tobacco, pending incentives

Looks like the rumors were true: Personal care products maker and longtime Triangle corporate citizen Burt's Bees is on the verge of moving downtown, to American Tobacco, from their current perch on the Durham-Wake border at Keystone in the midst of RTP.

The H-S' Monica Chen has a very good and detailed look at the news, which first popped up in the public record late Monday, via the April 6 City Council agenda.

Chen reports that the Hill Building -- currently the home of mobile content provider Motricity, which is in the midst of moving to Washington state -- would be Burt's Bees new site. BCR understands that Burt's Bees could potentially lease the entirety of the building, only half of which was occupied by Motricity; the firm would start in the existing footprint and expand over time.

The Hill Building has been rumored to be under scrutiny for other relocating firms before; last fall, a deal to relocate Bandwidth.com from offices in Cary to downtown Durham -- in what was rumored to be a Hill Building play, though unconfirmed by the company -- fell through.

DDI's Bill Kalkhof tells the Herald-Sun that Burt's Bees, now a division of Clorox, has weighed expanding at its current site, or relocating to Wake County's Perimeter Park, which we believe is in Morrisville, if American Tobacco isn't an option.

Interim director of Durham's Office of Economic and Workforce Development Kevin Dick notes in his memo that the firm has applied to Durham for $183,750 in economic development incentives. (We presume that this has been the subject of the two recent City Council closed sessions on economic development.)

The incentives would hinge upon the relocation of 132 jobs from the Keystone office park plus 51 new jobs expected to be created over five years. Dick's memo and presentation note that the well-above-living-wage positions (avg. salaries of almost $82,000) and the location inside Ambacco, a targeted community development area, fit within the boundaries of the Council's policy on economic incentives.

All of the incentives are performance-based, meaning City dollars would flow over time as jobs are created or retained. The incentives deal would run through spring 2012.

Though advocates for the deal may expect some political static given that Burt's Bees already is based within Durham's city limits, the firm's high-paying jobs, expected job growth (at a time when other companies are shrinking), longtime support for community service in Durham, and green reputation -- the growth of 'green jobs' is a high priority for the mayor and administration -- all stand out as important balancing figures in the incentives request.

In fact, provisions in the incentives deal would, among other things, have Burt's Bees assert that they would continue company-sponsored "Habitat for Humanities" building projects for their employees and to support other non-profits directly and through board service. Burt's Bees would also commit to providing the same level of health care services to its employees under the agreement.

Ultimately, the provision of such factors in the contract seems more to be about recognizing the good work the company is already doing than about trying to press it into maintaining those ties. At the end of the day, Burt's Bees is the kind of environmentally-friendly, community-oriented, responsible corporate citizen that communities kill to have located in their backyard.

And with a Wake County address one possible outcome for the firm, that may end up being the biggest reason of all to see elected officials get behind a move that would solidify Burt's Bees as a Durham-linked company.

Comments

Will

Beyond the incentives this is a win-win for both parties. Durham gets to keep it's ties to a nationally competitive natural personal care company and Burt's Bees gets to move into a recycled office building with character.

Let's face it, being owned by Clorox and housed in a generic office complex makes it seem like their corporate story as ventured too far from their first chapter of headquarters in an abandoned one-room schoolhouse in Maine. That's fine if you're a software company but a little more dicey for the honey-dripping lip balm set.

Perhaps they could put in a little retail establishment at ATC? I know a lot of people wish for some shopping along with their pizza and strolls around the river.

Jeremy T

FYI, Motricity occupied the entire building initially, and I'm pretty sure they still do presently. They certainly don't *need* all that space, given their headcount reduction, but I'm pretty sure they're stuck with it for the time being.

The head count you give for Burt's Bees (even counting potential growth) is substantially lower than Motricity's at its peak, so I wonder if you have this backwards (i.e., Burt's Bees would only be using part of the facility, where Motricity used it all).

I've often pondered how this building would eventually be subdivided, as finding another firm to fill the entire building seemed like it would be challenging. As it stands, it's a very open space - there are few interior walls and the floors don't extend all the way to the exterior walls. It's almost like a pyramid, with each subsequent floor being smaller than the last, with open space running all the way from the top to the bottom. Really quite cool, but not really very practical.

I suppose it can just be split right down the middle, but breaking it out based on floors would be really problematic.

RaleighRob

Compared to the kind of incentives most companies get these days, Burts Bees doesn't seem to be asking terribly much. Keeping 132 plus adding 51 new jobs seems worth it...plus filling in historic office building. Plus the workers would presumably eat lunch and spend money at other various businesses in the area. I see the city getting a decent return on that investment.

Freddie

I think a company like Burt's Bees would be a prefect match for that office space...They would definitely get more publicity and advertising by just being there because of the amount of foot traffic there...I never knew they were in Durham until my fiance mentioned it to me one day...I also never heard of motricity until I seen the signs there in A-T. So by just having the Burt's bees sign there like Motricity does would be free advertising for the company...In essence, it would work great for both parties.

I hope it goes through...

bb

Will,
If I'm not mistaken, they have some sort of retail component at their current space (or did a few years back...) I think you could buy discounted product over-runs...Perhaps they'll have something similar...

Lee

They don;t have a normal sales operation on a day to day basis, but they do have a big sale on a Saturday every year or so at their current place, though I can't remember if they held it at the corporate office or the plant/distribution center, which is in another building in the same office park.

Matt

What a great move for Burt's Bees and Durham! Now more people will know about this great company with Durham ties and will add more credibility to downtown Durham as a thriving business center. Incentives are well worth it for the city and a great move for Burt's!

buy generic viagra

Great article, I read that Burt's Bees currently offers over 150 natural personal care products in 30,000 retail locations and sales in excess of $250 million (2006) with satellite offices across the United States, UK, Ireland, Canada, Hong Kong, and Taiwan.

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