Dart Container Corporation, the Michigan-based manufacturer of foam and plastic containers and cutlery, will be closing its Hampstead and Havre de Grace warehouse and distribution centers in 2020.
The move comes as the company is building a new facility in Delaware that will house the products currently distributed from the two Maryland facilities, according to a company media release.
“The move to Delaware will enable us to consolidate inventory into a single location that serves our east coast customers more efficiently from a trucking and logistics standpoint,” Dart CEO Jim Lammers is quoting has having said in the release.
Maryland’s upcoming ban on foam containers, which goes into effect July 1, 2020, played a role in the company’s decision to close the two locations, a company spokesperson said in an email Thursday evening.
“While the state of Maryland’s ban was not the core reason to move our distribution operations to Delaware, elected officials’ decision to ban some of our products did not encourage us to keep our distribution centers in Maryland,” Margo Burrage said in an email.
Paul Poe, Dart’s manager of government affairs and environment had previously told the Baltimore Sun that the company was speaking with Maryland Gov. Larry Hogan in an effort to reduce the impact of the ban on Dart’s business in the state.
"We’re not pulling up stakes or anything like that, but it was a bit of a disappointment that we couldn’t have reached some kind of a deal” with lawmakers, Poe told The Sun.
The two facilities employ around 90 people between them, according to the release, and those employees who wish to apply to work in Delaware will be given a chance to do so, while those that do not will be given severance.
The Havre de Grace facility will be closed sometime in the first quarter of 2020, according to the release, while the Hampstead facility will remain open until the Delaware completed, “sometime in the fall.”
Dart’s location in Federalsburg will remain open, according to the release.
While a business leaving the area is never great news, Hampstead Mayor Chris Nevin said in this case he did not expect a signficant impact on the town and surrounding area.
“The warehouse borders our town so there will be no impact to our assessable base to the extent the vacancy impacts value,” Nevin wrote in an email. “Though losing a job is always difficult, the effect on area employment is also minimal.”
That’s due in part to the relatively smaller number of jobs at the Hampstead location, Nevin said, but also because of the promise of the soon to be vacant, one million square foot warehouse facility.
“It’s a Class A, cross docked facility with 32-foot clear ceilings, contains trailer parking, has a superior high volume wet sprinkler system and owned by a [Real Estate Investment Trust] that has experience with this type building,” Nevin wrote. “It is one of the only Class A warehouses of this size available for immediate occupancy in the State.”
It’s the type of building that has been the hottest in commodities on the industrial real estate market in the past few years, according to Matt Laraway, a Hampstead resident and executive vice president and partner in Chesapeake Real Estate Group. The only problem could be transportation.
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“When somebody is looking at using a building like that for e-commerce or traditional bricks and mortar store to door distribution, then it’s far out,” Laraway said. “From the major interstate of I-95 you have to go I-695 to I-795 to Md. 30 to the building.”
The Hampstead facility was originally built where it is in the ’90s, Laraway said, because of it’s proximity to the Sweet Heart plastics plant — later Solo Cup — on Reisterstown Road. That location is now a Wegmans.
“The question is," Laraway said, "is somebody going to prefer to be on I-83 or I-95 as opposed to Md. 30?”
The situation is nearly opposite in Havre de Grace, Laraway said.
“The Havre De Grace location, that’s on I-95, Harford County,” he said. “That’s kind of Main and Main for the big distribution centers in Maryland.”
But the 640,000 square foot space isn’t a appealing a building as the Hampstead location, according to Laraway.
“I would call that a Class B building in an A- location, where I would call this a Class A building in a C location,” he said, giving the Hampstead location the A and C grades. “Anybody in the country would come in and say, ‘this is super functional and I can operate super efficiently out of this building.’”