Rite Aid looks to Harford 125 acres in Perryman most likely site for distribution center

Roughly 1,100 jobs

$50 million facility would be as big as Whitemarsh Mall

March 02, 1997|By Kevin L. McQuaid | Kevin L. McQuaid,SUN STAFF

Rite Aid Corp. is finalizing plans for an estimated $50 million distribution center in Harford County that would employ roughly 1,100 and be one of the state's largest buildings.

If the Camp Hill, Pa., retailer officially commits to Maryland -- as is expected within a matter of weeks -- it would represent the latest in a series of economic development victories involving major warehouses over neighboring states.

In the past two years, for instance, Maryland has persuaded Saks Holdings Inc., Staples Inc., McCormick & Co. Inc., Solo Cup Co., Safeway Stores Inc. and others to develop large distribution centers here.

Rite Aid also is considering sites in Virginia for its project, sources said.

Although Rite Aid is apparently focused on a 125-acre site in the Perryman section of Harford, not far from the Frito-Lay Inc. chip plant, company officials are still negotiating with the state's Department of Business and Economic Development (DBED) agency over financial incentives valued at roughly $5 million, sources familiar with the package said.

"Rite Aid has a substantial presence here, and we will do whatever we can to help them expand," DBED Secretary James T. Brady said of the project in December.

Rite Aid, the nation's largest drugstore chain with $6 billion in annual sales, currently operates 174 stores in Maryland and employs 2,800. The distribution center's employment projections would make the company one of the region's largest private employers.

Employees who would work at the distribution hub -- scheduled initially to be completed by year-end -- would be paid an average of about $10 per hour with substantial benefits, sources said. By comparison, most local warehouse jobs pay an average of $8 per hour, with few related benefits.

Rite Aid executives involved with the project -- including Chairman and Chief Executive Officer Martin L. Grass, a Baltimore County resident -- could not be reached for comment, and DBED, Harford County and Rite Aid representatives at real estate firm Colliers Pinkard declined to discuss the company's plans.

Gov. Parris N. Glendening has tentatively agreed to provide the assistance because of the large number of jobs that would be created, and because, in the three months since Rite Aid first began its search, the project's size has mushroomed from 800,000 square feet to 1.2 million square feet.

At that size, Rite Aid's warehouse would be roughly equivalent to 28 football fields and contain as much space as the Rouse Co.'s White Marsh Mall.

It would also rival some of the state's largest buildings, surpassing a nearly 1 million-square-foot warehouse occupied by a division of Sears, Roebuck & Co. that had been part of a General Electric Co. complex in Columbia; a 1.3 million-square-foot National Security Agency operations facility at Fort Meade; and a potential 1 million-square-foot building under construction for Staples Inc. in Hagerstown.

Companies are drawn to Maryland for distribution because of the state's proximity to one-third of the U.S. population, reachable by truck within 24 hours; its sophisticated transportation network, including highways, the port of Baltimore and BWI Airport; and an abundant labor pool, industry analysts say.

Rite Aid requires the distribution center because it plans to open 400 stores this year. The new warehouse is expected to contain state-of-the-art conveyor systems and sophisticated merchandise tracking equipment to speed deliveries to stores and keep track of inventory.

The chain operates more than 2,800 stores nationwide, and will add even more when it converts the former Thrifty PayLess Holdings Inc. stores, which it took over three months ago through a $2.3 billion acquisition.

Pub Date: 3/02/97

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