Md. firm to buy closed brewery Purchase to help Washington Quality with growing demand

May 08, 1998|By Kevin L. McQuaid and Melody Simmons | Kevin L. McQuaid and Melody Simmons,SUN STAFF

Washington Quality Food Products, desperate for room to expand because of growth in its business, intends to purchase the closed Stroh Brewery Co. plant in Halethorpe at the end of this month.

The company based near Ellicott City, best known for making baking mix products found on supermarket shelves, is buying the brewery for $7.2 million and will invest about $12 million more to convert it to a food-processing center.

"We're under a lot of pressure like we've never been before," said Michael S. Everett, a Washington vice president and the company's chief operating officer. "We have 40 million pounds of ingredients a year going through our building now."

Washington plans to move about 100 jobs to the high-profile brewery, a Beltway landmark, by October, when renovation work is scheduled to be completed. Another 35 jobs are expected to be added, said Baltimore County economic development officials.

Officials in Baltimore County, which has seen the Halethorpe area ravaged by job losses, believe the Washington move will significantly help the area.

County and state economic development officials are pledging $2 million in loans and guarantees to offset Washington's costs, said Robert L. Hannon, executive director of the county's economic development office.

"It's a key ingredient in the overall financial package of acquisition, renovation and purchase of equipment necessary to put [Washington] into this plant," Hannon said.

Washington will likely be able to take advantage of income and property tax credits, because the plant and its surrounding 40 acres are within a county enterprise zone.

The Stroh plant employed more than 430 people before the Detroit brewer closed it in December 1996.

The 100 workers who will relocate from the plant near Ellicott City represent the company's burgeoning product-mixing operation, which has grown as a result of accounts from fast-food chains Kentucky Fried Chicken, Hardee's and Roy Rogers.

The 85-year-old company's flour milling operation -- the only working flour mill in the state -- will remain at the plant near Ellicott City. Everett said the company hasn't decided if the milling operation will eventually be moved to the former brewery.

Washington, which has sales of about $50 million a year and buys three million bushels of Maryland wheat and corn, is more than just a flour mill.

In addition to its muffin, corn bread and biscuit mixes, the company produces cake mixes for Tastykake and others; batter and breading for fast-food and other restaurants; and has a services division that supplies food to the University of Maryland and others.

Washington plans to use about half of the almost 600,000 square feet of manufacturing, office and warehouse space at the former brewery.

"There are associated baking operations that would complement them well," said John F. Wilhide, a vice president at CB Commercial Real Estate Group, which is representing Washington in its purchase. "And the building lends itself well to manufacturing."

By contrast, Washington's nine-story plant in Baltimore County, across the Patapsco River from Ellicott City, contains 172,000 square feet.

Washington's pending purchase comes less than a month after Goodman Industrial Equities LLC, a Boston real estate firm, had committed to buy the vacant plant. Goodman, which intended to restore manufacturing there, is selling its right to buy the plant to Washington, Everett said.

Baltimore County Council Chairman Stephen G. Sam Moxley, whose district includes Halethorpe, said the deal will bring "life back into the plant."

"It's very healthy for the market," said J. Richard Latini, a vice president of commercial real estate firm Colliers Pinkard, which Stroh retained to sell the plant.

Pub Date: 5/08/98

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