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Easley textile mill revitalized into loft apartments
By Molly Hulsey
mhulsey@scbiznews.com
Alice Co., a Greenville investment firm formerly known as Alice Manufacturing Co., sold Easley’s 19.2-acre Arial Mill property to a joint venture with plans to adapt the site as a mixed development community.
Farpoint Development, a Chicago and Asheville-based company that specializes in real estate development, will spearhead the project in partnership with Annenberg Investment and Baum Revision. CBRE’s Nick Hollstegge and Katherine Southard represented Alice Co. in the $2.6 million sale, according to a news release.
“We are excited at the opportunity to own and redevelop such a unique asset that is so integral to the Arial community,” Justin Patwin, managing director at Farpoint Development, said in the news release. “We are especially thankful to the McKissick family for being great stewards of this asset for so many years and working with our team to gracefully transition ownership to support the mill’s next chapter as a mixed-use development.”
The 212 Rice Road plant, which has served as the hub of the Arial Mill Village for decades, was built off a Pickens railroad main line in 1929.
Alice Manufacturing Cos. operated the site as a textile mill for 75 years, employing about 400 during the mill’s peak, according to the company. During the mill’s last 10 years in operation, it became a distribution center for Alice’s New York-made fashion bedding brand. The company’s nearby Ellison plant had produced greige fabric and yarn since 1966 until a “flood of imports from producers in non-market economies” led to the mill’s demise in 2018, according to a company announcement at the time, marking the end of an era for many in Pickens County. Another former Alice mill on Rice Road, Foster Plant, was heavily damaged by fire on Jan. 30.
Last summer, Alice Manufacturing rebranded itself as an innovation economy investment firm, Alice Co., under CEO E. Smyth McKissick IV, the greatgreat-grandson of the company’s founder.
Pickens County and South Carolina officials are assisting developers with the preservation of the original structure as they revitalize its 343,686-square-foot frame to house lofted apartments.
The property is located within an Opportunity Zone and, once redeveloped, could have access to federal and state historic tax credits, S.C. Textile Communities Revitalization Credits and New Market Tax Credits, according to CBRE.
Arial Mill’s proximity to Pickens’ former railroad line now gives the property access to the Doodle Trail, a biking and pedestrian path developed in the former rail bed.
Plans for the remainder of the Arial campus will be finalized over the coming months, according to developers. “We are so happy to know that Arial will be restored, with a new purpose that fits today’s growing needs of Pickens County,” McKissick said in the release. “Farpoint Development and their partners have a proven track record in adaptive reuse, and we’re excited to see what they will do with Arial. That, along with their desire to contribute to the growth of Pickens County, makes them an ideal new owner of this property.”
The Arial Mill’s proximity to the former Pickens railroad mainline now gives the property access to the Doodle Trail, a biking and pedestrian trail paved over the former rail bed. (Photo/Molly Hulsey)
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circulation. But there is a shortage in how many chassis are available for use at the terminal — and not waiting to be unloaded at a short-staffed warehouse or transported back to the terminal by a coronavirus-inundated fleet.
Solutions, not weather reports
The S.C. Ports Authority will be the second ports system in the nation to create its own chassis pool program to meet that demand, according to COO Barbara Melvin.
Once launched in 2023 through a $200 million investment, the pool will house thousands of chassis able to be leased from the Port of Charleston’s terminal. The seed money will be sourced from port revenue, she said.
“We’re trying to utilize the latest technology to see how we can rethink the chassis pool model,” said James Caudill, director of the ports authority’s chassis pool. He added that the new chassis, built by Dorsey Intermodel will be wired with GPS tracking technology. “GPS technology sounds simple, but you can utilize something like that to forecast issues down the road.”
The data could be used to help streamline inventory management or provide business insight for port customers.
Aside from Port of Virginia, the first port to develop its own chassis pool, many Eastern ports participated in the South Atlantic Chassis Pool.
The closed-loop Palmetto State pool is expected to enhance the efficiency and availability for logistics companies, and also open up chassis for other nearby ports systems.
“That really is the biggest benefit for the supply chain,” said Melvin.
Leading up to the 2023 launch, the ports authority will phase out its use of chassis leased from the South Atlantic Pool with more than 11,000 purchased chassis that will be upfitted with smart tech.
On Jan. 24, the Port of Charleston received its first shipment of more than 700 chassis after a 40-day journey on the Liberty Promise from Vietnam, according to the ports system. An additional 1,600 are set to arrive in February as the ports authority builds out its inventory. These chassis will be available for longterm lease agreements until the April 2023 launch. After, they will be available for a daily rate.
Rates will soon be made public, according to the ports authority.
“We’re going through all the steps ofmaking them ready for providing [for] the people who have a need early on right now for 20-foot equipment,” Caudill said. “And then, as we go throughout this year, we’ll step-by-step transition areas like Greer and Dillon. That will provide relief to the South Atlantic chassis pool.”
The chassis pool is just one of the places the ports authority sees room for growth as more ships redirect from clogged West Coast ports to Charleston.
“We see others along with the chassis, whether that be ample warehouse space, a labor force that is available for working in logistics, motor carrier driver availability,” as well as the ability to move containers off marine terminals, said Melvin.
State support to build a dual-served rail facility will go a long way for helping the port keep pace, she said. Once finished, it will bring port capacity to more than 1 million rail lifts. The port deepening project, set to make the Port of Charleston the deepest in the Southeast, is expected to reach completion in September.
“Even when we hit supply chain challenges like we’re seeing today, we have to keep working through those with our maritime partners, keep putting forward solutions instead of just having weather reports on the problem,” she said. “You have to bite the bullet sometimes and do what we’re doing with the chassis pool. You have to not get scared when you’re making investments like a billion dollars into a new terminal. You have to have a long view of what is needed in the supply chain to be successful.”
Barbara Melvin COO and future CEO S.C. Ports Authority
Reach Molly Hulsey at 864-720-1222 or @mollyhulsey_gsa on Twitter.
OMICRON , from Page 1
policies a “nightmare for HR.”
That also includes rapid antigen tests, which, even as they have become more available, continue to be much less sensitive than the PCR test. One can trust a positive rapid result accompanied by symptoms most of the time, according to Brown, but a negative with symptoms or without symptoms, such as a rapid test used to screen employees each week, is suspect. Prisma does not accept a rapid antigen negative as grounds for returning to work. It takes into account the result of a positive antigen test if it is accompanied by symptoms. If the rapid test comes back negative and employees continue to have symptoms, Prisma requires them to get a PCR test.
In line with Centers for Disease Control and Prevention guidance, Brown advised employers to allow employees who are positive with the virus or show symptoms to return to work six days after the last 24-hours of symptoms. They should also wear a mask for five days after returning, she said.
Employees who are asymptomatic but have been in direct contact with an infected person should be asked to quarantine for five days following exposure and return with a negative PCR test taken on day four after, according to Brown.
“This is a phenomenal oversimplification,” she said, adding that additional measures like encouraging vaccination, the use of surgical or higher-grade masks for the vaccinated and unvaccinated, rescheduled events and social distancing for those unable to mask can go a long way in mitigating COVID-19 related absences.
Especially as test shortages have been so severe that she — and many of her clients — doubted that the OSHA Emergency Temporary Standard for weekly testing could have been carried out if it had not been shot down by the U.S. Supreme Court.
“We are trying so hard to get organizations to understand that ordering those return-to-work tests for folks who have been out with COVID — they clog up the health care system, they use up coveted tests, and they will complicate the returnto-work picture,” said Brown. “So just use the clinical guidelines to bring people back to work.”
Obstacle after obstacle
S.C. employer protections will keep businesses covered from most pandemic-related lawsuits if they roll out COVID19 policies in line with CDC guidance, according to Lucas Asper, an employment law shareholder of Ogletree Deakins and a spokesperson for the Greenville Society for Human Resource Management.
South Carolina’s COVID-19 Liability Immunity Act signed into law last summer offers liability protections for a limited amount of time to health care providers and businesses that follow COVID-19 public health guidance.
“The only claims that I think would be truly viable would be based on alleged OSHA violations. Tort claims against employers will likely be limited to situations where employers thumb their nose at public health guidance — where they know there’s a problem or a lack of compliance and they’re just sticking their heads in the sand,” said Asper.
Ogletree Deakins has been involved in 39 COVID-19 related cases in South Carolina. The manufacturing, public and hospitality sectors are the most likely to see legal action, according to the company’s COVID-19 litigation tracker.
In one case, a shop foreman at a manufacturing facility alleged his company failed to enforce social distancing or provide proper personal protective equipment. He claimed he was fired and left uncompensated after calling in sick to receive a COVID-19 test and then entering the hospital for another illness.
At another facility, an employee claims he was fired in retaliation for reporting that his supervisor had remained at work after exposure to a known COVID-19 case.
Other cases involved claimed termination, discipline or lack of promised sick pay following quarantine, a workplace-based exposure, demands for Emergency Family Leave or requests from employees with an alleged autoimmune disorder to work from home.
“With the OSHA piece of this, even with the ETS getting stayed and now put out to pasture permanently, all employers that are subject to OSHA are subject to the general duty clause, and what that says is: you have to make sure you’re providing a safe and healthy workplace and avoiding any recognizable hazards for employees,” he said. “Because of that, if we are following CDC guidelines, we should be in pretty good shape.”
That means not just creating policies on paper but to communicate them on the day-to-day and stay aware. Asper also advises employers to install masking policies for employees that engage with the public where social distancing isn’t possible, regardless of vaccination status, to prevent both infection and legal action.
“I have not been encouraging anyone to institute a testing policy at this point, especially now that the ETS is gone, and one of the main reasons why is the challenge of procuring tests for an entire workforce on an ongoing basis,” he said. “As we were headed toward enforcement of the ETS, I talked to several companies that had attempted to source tests from numerous locations and were meeting obstacle after obstacle after obstacle.”
Positive feedback from the failure of the OSHA ETS has been almost unanimous among Asper’s clients.
“Companies that wanted to implement a mandatory vaccine probably already did it, or they started heading down that path as this started percolating through the courts,” he said. “And they probably won’t change course.”
Follow GSA Business Report’s continued conversation with Asper on vaccine mandates and exemptions at gsabusiness.com.
Greenville-Spartanburg named best location for warehousing
By Molly Hulsey
mhulsey@scbiznews.com
Companies are fueling emerging warehouse markets in their search to shore up inventory while supply chains continue to snag, according to a recent report from CBRE.
U.S. warehouse vacancy rates have hit a record low of 3.6%. Traditional logistics hubs can’t produce enough warehouse stock to meet the demand and alleviate congestion, so companies are forced to shift their eyes further afield, the report said.
Report analysts listed the Greenville-Spartanburg metro as the strongest market for companies’ “safety storage” strategy in North America.
Dubbed “an upcoming transportation and manufacturing juggernaut,” the metro area was selected for its diverse economy, supply chain efficiency and low cost. The GSP market was followed by Louisville, Ky., and Monterrey, Mexico.
“The supply chain as we knew it preCOVID broke, and there’s a new one that’s been created,” James Breeze, report author and global head of industrial research for CBRE, told GSA Business Report.
The next generation of trade focuses on the diversification of product sources and securing domestic inventory.
“What we were looking at for these markets is essentially, one, being able to control inventory, two, having diverse transportation options to distribute product either nationally or within a region with a high population growth, and three, being either in close proximity to a point of import for product or a point of creation for product,” said Breeze. “There were not too many markets around the world that could check all three boxes, but the Greenville-Spartanburg market is one of those.”
The Upstate is close enough to take advantage of the Charleston ports and Inland Port Greer’s proximity to markets like Charlotte, Atlanta and Chattanooga, Tenn., to bring its viability up a notch. Rail access opens Greenville-Spartanburg, itself a strong manufacturing hub, to the Midwest, and close to 33 million people who can be reached within 250 miles from a Greenville warehouse, he said.
Robust economic development incentives, rent prices and land availability also were part of the equation.
“Obviously, Charleston is a top-notch market for industrial, also,” Breeze said. “Charleston is a growing port. It’s also one of the few seaport markets where you can build products also, but Greenville has a little bit more options and a little bit of a bigger geographic market.”
The Upstate’s industrial rent prices, half the national average, tipped the scales at a lower rate than Charleston.
Asking rent in the fourth quarter of 2021 was $4.58 per square foot, a 25% increase year-over-year from 2020. The national average for warehousing rent is $9.10 per square foot, he said.
Vacancy rates in the Greenville-Spartanburg area scraped 3.3%, reflecting the close to 10 million square feet absorbed in 2021. Close to 12 million square feet of industrial space is under construction in Greenville today, but a third of that space was leased even before the buildings were up.
“The top demand driver of the industrial market today is that inventory protection, that diversity of storage, and it’s led to 1 billion square feet of leasing activity nationally this year,” he said. “The previous record was 713 million square feet but the record was broken by nearly 300 million square feet this year, which is just a towering amount. Right now, early in the year, we’re seeing nothing changing.”
According to Breeze, companies are not selling off warehouses on the West Coast in response to port backlogs — they’re keeping their options open. They are also investing in higher ceiling, larger truck courts and more automation to bolster inventory and alleviate the impact of labor shortages.
But in some cases, the remedy — additional inventory — has only exacerbated the cycle.
“Right now, it’s creating more of a backlog to get products in, which was essentially the problem to begin with, but that will clear off once these things get flowed in, once the additional warehouses that have been leased this past year are occupied. Then that delay will decline,” he said.
Smith Farms Industrial Park, a 450-acres multibuilding speculative industrial development in Greer, broke ground on this building in September 2021. The park adds 1.1 million square feet of warehousing space to the Upstate’s inventory. (Photo/Provided)
Reach Molly Hulsey at 864-720-1222 or @mollyhulsey_gsa on Twitter.
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Furman launches $70M development project on campus
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Furman University will break ground Feb. 12 on a $70 million project to build a new residence hall and update four others in the South Housing complex for first-year students.
The project will replace the current Blackwell Hall, relocate the Center for Inclusive Communities into the new hall and introduce modern amenities in the new and existing halls including safety upgrades, entrance accessibility, new bathroom layouts and fixtures, social spaces and information technology improvements.
Construction is slated to begin in March.
The first students to move into the new residence hall, with an expected completion date of fall 2023, will be members of the class of 2027. The school expects the entire renovation and construction project to be finished in November 2024.
The college got students involved on Jan. 12 students saw the capital funding campaign for the project unfold in real time, Wall Street-style, when Furman opened the sale of bonds to the market.
Furman’s Business Block students, other students from accounting, economics and Furman’s Investments Club, faculty, administrators, financial advisors, underwriters and more gathered as the public auction for 30-year municipal bonds went live.
It’s the first time Furman has opened its financing process to the campus community.
“Students were able to see the market — the demand for the bonds, and this is something students rarely, if ever, have the chance to witness on college campuses,” Susan Maddux, Furman vice president of finance and administration, said in a news
A $31.2 million residence hall is a key part of Furman University’s $70 million development plan. (Rendering/Mackey Mitchell)
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release.
The development project will be funded through financing, including approximately $31.2 million for the new first-year residence hall.
Furman President Elizabeth Davis joined the 40-plus students and others at the bond pricing event.
“Through this hands-on experience,” she said in the release, “our students learned how this works — the tradeoffs, market instability, inflation, and how all of this affects investors — applying what they have learned in the classroom in a real-world, high-stakes situation that was truly unique. Learning experiences like this help to prepare our students for any career they might pursue.”
The renovations of residence halls Manly, Geer, McGlothlin and Poteat, and construction of the new residence hall will grow the overall total beds for South Housing to 718, ensuring the entire firstyear class is housed in one location.
“The South Housing renovation and construction project will not only enhance the residential experience for first-year students but will create a residential village that strengthens the connection to the core of campus, much like the Trone Student Center renovation and boardwalk provided a few years ago,” Connie Carson, vice president for Furman’s student life office, said in the news release. “The firstyear South Housing experience will better connect students to each other in the various halls while serving as a centerpiece for student activity both inside and outside residence halls.”
Demolition of Blackwell Hall, a 1960sera building named after Furman’s eighth president, Gordon Williams Blackwell, will begin in May 2024 and last through September. An evaluation of Blackwell Hall determined that it would cost more to renovate the building than to replace it.
The university administration is discussing ways to continue to honor the former president.
“By reimagining the first-year residence hall from the ground up, we are creating a vibrant student hub, one with new personal and social spaces for students to gather and connect for years to come, setting their trajectory for success at Furman and beyond,” Davis said in the release. “This project enhances the safety, accessibility, security and privacy components of all the residence halls in South Housing, while also advancing the university’s sustainability goals.”
The design will offer additional space for the Center for Inclusive Communities, which will move from the Trone Student Center, to grow programs and initiatives, according to Deborah Allen, who served as the director of the center until last week and played a central role in the project’s early planning, according to the release. The new building will include reception and office spaces, a kitchenette, meeting and lounge spaces and support services.
“Now in its fifth academic year, the CIC continues to cultivate an inclusive and welcoming environment for Furman’s historically underrepresented students to thrive as their authentic selves,” Allen said in the release. “Staff foster opportunities for students to engage with people from various cultures and identities and reflect deeply on their own intersecting identities.”
The center coordinates activities and events focusing on first-generation students, cultural heritage and awareness, the LGBTQ community and the legacy of the Rev. Martin Luther King Jr., among others. Rod Kelley is serving as interim director of the center while a national search is conducted.
Missouri-based Mackey Mitchell Architects is partnering with McMillan Pazdan Smith, which has offices in Atlanta and the Carolinas, to serve as the design team. The construction management company on the project is Rodgers Builders, a women-owned firm headquartered in Charlotte. The firm also managed the Townes Center for Science addition and renovation, which was Furman’s largest project to date. As part of this new South Housing project, Rodgers Builders will be contacting minority-owned businesses to perform some of the subcontractor work.
Furman students got involved with fundraising for the South Housing complex by bearing witness to a bond sale. (Image/Provided)
Boeing hopes 787 inventory takes off soon
By Teri Errico Griffis
tgriffis@scbiznews.com
Last year was a rebuilding year for Boeing — there’s just not a whole lot of building new 787 jets here in South Carolina.
Deliveries of the jet have been halted since May when the Federal Aviation Authority requested to look into further production quality issues regarding tiny gaps found between the sections of the fuselage. About the width of a human hair, the gaps were not a safety of flight issue for the in-service fleet, but the company has been working since to address the problem.
Last year, Boeing only delivered a total of 14 jets manufactured in North Charleston, a far cry from the 53 recorded in 2020. Zero were delivered in the final quarter of last year.
After months of delivery delays caused by Federal Aviation Authority and zero deliveries in the fourth quarter, Boeing now has 110 airplanes in inventory as of the fourth quarter and executives said at an nvestor call Jan. 26 that they still don’t know when deliveries will resume.
“We set out on a comprehensive program to ensure every 787 airplane in our production system conforms to our exacting specifications. We resolved many of the non-conformances and, we’re finalizing our work on the remaining items,” Executive Vice President and CFO Brian West said on the call.
Boeing reported a fourth quarter revenue of $4.8 billion, primarily driven by higher 737 deliveries that were “partially offset by lower widebody deliveries and less favorable mix.”
Operating losses of $4.5 billion were primarily driven by charges on the 787 program, resulting in a negative margin rate, West said.
But despite a hard hit to the 787 program, CEO Dave Calhoun remains optimistic for a robust recovery of the 787 program in the next year or two.
“It reflects everything we’ve learned about the rework process itself, the data required to restart deliveries and obtain ticketing and then customer expectations regarding concessions as we move forward,” Calhoun said.
The CEO regards Boeing’s backlog of more than 100 finished planes, including a buildup of 737 Max jets, as a “double-edged sword.” Boeing would rather not carry such a large inventory, but Calhoun believes the planes will serve the company well in the future as bookings and customer discussions are still ongoing with regard to their fleet plans, medium- and long-term.
“We will run our rate as low as we can while we burn our inventory as fast as we can, I think is the way to think about it,” he said.
Part of Calhoun’s confidence comes from the volume of the 787s currently in the field, with 99% of the fleet is in service today compared to pre-pandemic levels. The 787 is the most used widebody in the air today, he said.
“This is a great product line and a competitive product. And as soon as we begin delivery, we feel very good about the ultimate recovery,” he said.
West wouldn’t speculate when 787 deliveries could restart — though Calhoun said it could still be a couple more months — but he said on the call, “we have made meaningful strides in addressing many of the non-conformances we identified. We have work remaining to do, and we continue to hold detailed productive discussions with the FAA every step of the way.”
From a financial impact standpoint, Boeing recorded a $3.5 billion noncash charge in the fourth quarter to write down “unamortized deferred production costs, primarily due to estimated customer compensation for the longer delivery delays,” West said.
He emphasized that cash margins on the 787 continue to be positive and are expected to remain so and improve over time.
For the $3.5 billion charge, West explained the company had previously expected rework for the door-surrounds to be labor-intensive, but by the fourth quarter, the company realized the solution needed to be performed on the entire inventory, therefore impacting more planes.
“We provided for estimated customer concessions because of these delays, which drove the $3.5 billion charge. While this hurts in the near term, we still believe it’s the right thing to do because long term. We’re going to sell a lot of these 787s for decades. So, we just got to work our way through this,” West said.
Looking ahead, West breaks down the coming year as three separate parts: reaching key milestones to resume 787 deliveries; improving performing metrics, such as deliveries, revenue, margin
See BOEING, Page 12
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