Week of April 11, 2005
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Arby's HQ Could Be Bound for Atlanta
by RON STARNER,
Site Selection Director of Publications
ATLANTA The Triarc Restaurant Group, parent company of the Arby's fast-food chain, may be planning to relocate its corporate headquarters from Fort Lauderdale to Atlanta.
The move is tied closely to an effort by Triarc to acquire Atlanta-based RTM Restaurant Group, the chain's largest franchisee in the U.S.
"From a business perspective, the move back to Atlanta means that they are closer to their franchisees and that their franchisees do not have to pay the extra airfare and travel time when most of them have to go through Atlanta for training, etc.," says Ed Rondeau, a former Arby's corporate real estate vice president who now handles real estate for another company in Atlanta.
"Atlanta is the Southeast region hub and the largest Arby's franchisee, RTM, is based in Atlanta," Rondeau says. "I believe this is a cost-of-doing-business decision, a travel cost reduction issue, a time management issue, and other companies have left South Florida in search of more experienced and business-focused employees. Also, there is a higher cost-of-living in South Florida that Arby's would not have to experience while providing itself with a larger labor pool."
Arby's first located in South Florida about two years after the roast beef restaurant chain was purchased by the Victor Posner Co. in 1985. Ironically, a move to Atlanta would place the company in the hometown of Doug Benham, who was appointed president and CEO of Arby's LLC in 2003.
"The marketing and purchasing arm of the franchisee organization being in Atlanta helps them in meetings and doing business throughout North America," says Rondeau, who after his Arby's career served as director of global operations for the Atlanta-based International Development Research Council until 2002. "As Arby's has always been trying to develop a larger international franchise market, being in Atlanta is in my opinion more conducive to bring, sell and train international franchisees. And I imagine that franchisees, over time, kept encouraging Arby's to move closer to their market, which was not South Florida focused."
Triarc, which handles all franchising of the Arby's brand for some 3,450 restaurants, operates only 235 Arby's stores, while RTM owns some 774 Arby's restaurants.
Triarc is currently headquartered at 1000 Corporate Boulevard in Fort Lauderdale, but the company's lease of 55,000 sq. ft. (5,110 sq. m.) expires on June 30. Though the company has been headquartered there for 12 years, the space occupied by the firm is being actively marketed by the Trammell Crow Company's Boca Raton office.
About 100 Arby's employees work at the Radice Corporate Center III building in Fort Lauderdale, overlooking Interstate 95 in the Cypress Creek area of booming Broward County.
RTM is currently headquartered at 5995 Barfield Road just north of the interchange at Interstate 285 and Georgia 400 in Atlanta. RTM bought the 27,000-sq.-ft. (2,508-sq.-m.) facility in 1987 for $2.3 million.
There are other ties to Atlanta as well. Benham, the new Arby's CEO, worked at RTM for 14 years. Also, Arby's recently hired Atlanta-based public relations company Manning Selvage & Lee to handle some of Arby's communications.
Triarc announced in late January that it had begun talks to acquire RTM. Triarc's annual revenues have climbed from $87.5 million in 2000 to $92.8 million in 2001, $97.8 million in 2002 and $293.6 million in 2003.
The average Arby's restaurant in 2004 recorded a sales volume of $861,000.
RTM has annual sales of about $850 million.
If Arby's does move to Atlanta, the company will likely take advantage of a Georgia tax credit that rewards corporate headquarters relocations. Qualifying companies can receive up to $2,500 per employee for five years simply by moving a headquarters operation to Georgia. If the jobs pay an annual salary double the average Georgia wage, the tax credits can double.
Arby's was founded in 1964 in Boardman, Ohio, by brothers Leroy and Forrest Raffel, serving 69-cent roast beef sandwiches, potato chips and Texas-sized iced tea. They opened the first Arby's franchisee restaurant in Akron one year later.
Arby's Inc. changed its name to the Triarc Restaurant Group in 1996 to reflect the company's evolution as a multi-branded restaurant firm.
Power Plants and Gypsum:
by ADAM BRUNS, Site Selection Managing Editor
Irvine’s Just Fine With Kia
by ADAM BRUNS, Site Selection Managing Editor
Early this month, Kia Motors America, a subsidiary of South Korea’s Kia Motors Corp. that is part of the Hyundai-Kia Automotive Group, announced it would build a $70-million, 236,000-sq.-ft. campus in Irvine, Calif., where it currently leases 153,000 sq. ft. of space for its North American headquarters.
"This new center was designed to allow our employees and visitors to enjoy and take advantage of the warm climate found in Southern California throughout the year," said Christine Park, Kia's director of human resources/administration.
Commencing construction this summer, the company expects to be moving in by the end of 2006. The complex will house units including sales, marketing, consumer affairs, technical service, product planning and administration.
The city is certainly known for its automotive design cluster, boasting among its 12 automotive companies design centers from Kia, Mercedes-Benz, Lincoln Mercury and Saleen Inc. Hyundai last expanded in the city in 2001, with a 90-employee, $8-million design center. In addition, the city hosts North American headquarters for Ford Premier Automotive Group and Mazda.
But other sectors have been making noise recently in Irvine too, led by pharmaceutical companies. Most recently, in 2004, Allergan announced a 250-employee, $60-million R&D expansion. Medical device maker Masimo has expanded, as have Ista Pharmaceuticals and MP Biomedicals.
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