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Aaron’s, All Star find new home in spec building

Pike County — Spec buildings, by their vary nature, can cause sleepless nights for community and economic development leaders. “Build it, and they will come” is a true leap of faith, and when taxpayer money is involved, the decision to erect a spec building can be a spooky proposition.

This is not true in Pike County, however. Its Metro-Pike Industrial Building has had no trouble finding takers since it was built in 1999. And the facility currently houses two new companies — Aaron’s Rents, which has purchased the complex and is using it for its new Aaron’s Distribution Center, and All Star Beverage, which is subleasing space from Aaron’s for a new bottling operation.

Thirsty for space

Just months after completing the Metro-Pike Industrial Building in 1999, a Kansas-based company called North America Water bought the facility. The bottled water company finished out the building, expanding it from 50,000 square feet to 125,000 square feet. It stayed for two years until financial woes drove it out of business.

The building was subsequently leased to another bottled water company — Atlantic Beverage — which operated out of the facility for a year before it too closed its doors for good. When Aaron’s bought the Metro-Pike building, it subleased 40,000 square feet of the building to yet another beverage company, All Star Beverage, a subsidiary of American Waterstar of Las Vegas.

While its corporate headquarters may be located out of state, the rank and file at All Star’s Pike County operation are homegrown; in fact, some of them were employed by Atlantic Beverage, including plant manager Roma Hensley.

“That’s why they hired me — because I was familiar with the facility and the operation,” said Hensley, who was operation manager for Atlantic Beverage and has lived in Pike County for 15 years. The facility being previously “customized” for beverage companies is another plus. “This is a brand new operation in Mississippi,” he said. “We used to co-bottle, but the company’s orders made so many product lists that we needed our own bottling plant. Fortunately, we haven’t had to buy additional equipment to get up and running. We probably will later, though.”

The reason Hensley is expecting equipment purchases in the future is that All Star is in a growth mode. The company is running two shifts, employing 25 workers, and is currently capable of capping 200 cases of beverages per shift.
Far from just bottled water, All Star bottles Hawaiian Tropic water (a diet drink), and is under license to bottle a number of different flavors and a line of teas. But Hensley said the company is currently going after the energy drink market, and hopes that operation will be brought to Pike County, as well. He said that would be a catalyst for dynamic growth at the new bottling plant.

“My vision is that we not only grow in products, but also produce supply materials,” he said. “For instance, we would fabricate our bottles on-site. I definitely expect the operation to grow.”

The Aaron’s explosion

Atlanta-based Aaron’s Rents is not just growing, it’s exploding. Three years ago, the company that offers practically everything in home furnishings and entertainment operated 550 stores. Today, it oversees a chain of nearly 1,000 stores. The stores needing service in Mississippi and the surrounding area has grown from 40 to 70.

With all this growth, Aaron’s struck on a strategy of opening a number of distribution centers scattered across its territory to better serve its stores. The company began searching for a location for a new warehouse/distribution facility to serve this area, originally looking in Louisiana.

But, according to Robert McKee, manager of the Aaron’s Distribution Center in Pike County, corporate real estate happened onto the Metro-Pike Industrial Building, and, finding Mississippi centrally located, bought it.

“We believe Mississippi has great growth potential,” McKee said.

The new center, one of now 14 that the company operates, went into operation in April. The warehouse/distribution operation currently employs 17 workers, but McKee said Aaron’s is already looking to hire three or four more employees. The facility holds anywhere from $3 million to $5 million worth of merchandise at any one time, and the center typically ships hundreds of thousands of dollars worth of merchandise daily. However, that could be only the beginning of the Pike County story.

“What I see, if we keep going at this pace, is the need for 100,000 square feet, and this facility serving 60-90 stores,” said McKee, a Memphis native who grew up in Southaven. “But that may change. We could eventually need 200,000 square feet and serve 100-200 stores.

“We already can’t handle what we have. We need more space.”
McKee said corporate is currently talking with All Star to find out what its needs are now and what they may be in the future. McKee said it could be that both would stay in the Metro-Pike Industrial Building through expansion of the existing facility. If that looks to be impractical, a new home for Aaron’s Distribution Center may be in the offing.

Contact MBJ staff writer Wally Northway at northway@msbusiness.com.


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