Starbucks considers Harford site Seattle coffee chain wants East Coast distribution center

A Harford County site is one of two finalists in a five-state competition for an Eastern processing and distribution center for Starbucks Corp., the Seattle-based coffee chain that is expanding rapidly in the Eastern United States.

Craig Kinzer, a Seattle relocation consultant working for Starbucks, said the finalists are York, Pa., and the Riverside Business Park in Belcamp, where Starbucks is considering a deal for a site controlled by the Obrecht family, longtime players in Baltimore-area development.


"It's extremely close," Mr. Kinzer said. "I know we'll make a decision within two weeks." He said the initial phase of the facility will be about 400,000 square feet, which would make it the largest new development of the year in metropolitan Baltimore. In three phases, the project could grow to 1 million square feet and provide 400 to 500 jobs, he said.

The next-biggest proposal in the local pipeline is Time Warner Inc.'s all-but-completed deal to build an Eastern distribution center for its Warner Bros. retail division in White Marsh. That project would be built in two phases for a combined total of about 700,000 square feet.


"It's a very big score [for the winning state]," Pennsylvania Commerce Department spokesman Ron Jury said. "There aren't a lot of Mercedeses and companies like that out there."

The German automaker ended a fevered competition among states last year by deciding to build a $300 million, 1,500-worker auto plant in Alabama.

Robert McGlotten, manager of national business development for Maryland's Department of Economic and Employment Development, said he would not discuss the Starbucks deal. "At this point some of the proposals, some of the negotiations, are not complete," he said.

Harford County Executive Eileen M. Rehrmann also would not discuss the negotiations yesterday, nor what incentives the county or state are offering Starbucks.

Starbucks spokeswoman Kat Spellman said the 380-store chain has 23 stores in metropolitan Washington (including two stores in the Baltimore area), Massachusetts and New York. It has two locations in the Baltimore area. Last month the company said it would add 200 new stores during fiscal 1995, but the company has not said how many will be in the Eastern United States.

Mr. Kinzer said Starbucks will probably announce its choice after a deal formally closes, which he said


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will happen about 30 days after Starbucks chooses a site. In addition to Harford County and York, the company had been considering sites in Delaware, Virginia and West Virginia, he said.

Harford County has had notable success in luring distribution facilities in recent years. Among the companies that have opened warehouse or warehouse/manufacturing operations in Harford since 1992 are Gap Inc., Clorox Co., Michelin North America, Pier One Imports and Frito-Lay.

Mr. Kinzer said both Maryland and Pennsylvania have offered incentive packages to lure the plant, where Starbucks will roast coffee, package it and ship it to company stores. The company also has a growing mail-order business, he said.

Mr. Jury said the Pennsylvania

legislature approved $5 million of low-cost financing to help build the facility last month. Pennsylvania has a "Sunny Day" program to finance economic development initiatives worth at least $10 million, but each major loan requires legislative approval, he said.

He said Pennsylvania does not offer tax abatements to lure business.


Mr. Kinzer said local officials in York have more ability to offer financing through a public development authority than do Maryland officials, which presumably would be an advantage for Pennsylvania. He said other factors in the final decision will include the speed of the development permit process, which has been a strong selling point for Harford County in pursuing other deals; air emissions standards; labor costs; and transportation access.