The first tenant for El Campo’s rail-supported warehouse project will be Vitro Chemicals with construction set to start before April.
The news, issued by Stonemont Financial Group last week, is a major step for the Southwest International Gateway Business Park on the city’s east side.
“When the tenants begin to sign leases in the park you can place your bet that the project is going to happen. This is the announcement that everyone has been striving and pushing for,” El Campo City Development Corporation Executive Director Carolyn Gibson told the Leader-News Thursday.
The rail park actually broke ground in 2018, but was delayed as developers worked with state and local officials preparing infrastructure financing including a Public Improvement District and Municipal Management District. The districts allow park officials to levy a charge on tenants to help pay for rail and other infrastructure costs.
“Huge projects like this take many partners and years to formulate ... There were just so many puzzle pieces that had to be put together, in the right order, for this project to come together,” Gibson said.
Stonemont Financial Group says its now ready to move forward with the tenant announcement.
“We couldn’t be happier about having Vitro as our first tenant,” said Zack Markwell, CEO and managing principal of Stonemont. “Vitro took the time to understand the park’s value proposition to cross-border shippers like themselves, and their lease commitment is a fantastic validation that the new ‘mousetrap’ we’ve created is indeed better.”
Poised on the Kansas City Southern Railways line running from Illinois through to the Pacific side of Mexico, the park’s location is ideal for shippers moving goods to Mexican ports or into the United States from them.
“This will be a massive economic development driver,” spokesman Nick Banaszak said. “The big picture: You can expect El Campo to become a new focal point for manufacturers and distributors who need to expedite delivery of their goods and services.”
Designed to cover up to 540 acres, the El Campo rail park can hold up to eight million square feet of industrial space, designed to take material from rail to warehouse to semi-truck for delivery.
A 125,000-square-foot distribution center for Vitro Chemicals and a 200,000-square-foot speculative warehouse will be the first structures.
Vitro Chemicals is a subsidiary of Vitro, one of the world’s largest glass manufacturers that supplies Calcium Chloride, Sodium Carbonate and Sodium Bicarbonate.
“Vitro has been wanting to come to El Campo for at least four years,” Gibson said. “This is the type of company we want to be part of our community, the kind of folks who think outside of the box, are sensitive to things like recycling and waste, and will bring positive international attention to El Campo.”
The company currently stores product in multiple warehouses in Laredo and then distributes by truck from there.
Rail park developers hope to capture other shippers currently warehousing products in Laredo, off KCS lines.
“To deliver product to the major Texas markets, many of the Mexico-based manufacturers currently switch to another railway in Laredo, pass through San Antonio and then deal with the rail and truck congestion of Houston,” said Zack Markwell, managing principal and CEO at Stonemont Financial Group. “Our park establishes a new inland port that avoids all three of these time and cost headaches, allowing companies to invest more dollars in core business activities that foster long-term growth and success.”
The city has established a Federal Opportunity Zone and Foreign Trade Zone in the area as incentives to tenants, potentially enabling them to bypass capital gains tax payments on certain investments.
“Our project team has carefully mapped out the logistical infrastructure and incentive packages that had to be in place to ensure this becomes the region’s leading inland port. We look forward to starting construction in the coming weeks and anticipate sharing more news on our progress in the near future,” said David Burch, principal and general counsel for Stonemont.
Park developers are Stonemont, Ridgeline Property Group, Watco Companies which will operate the short line railroad connecting the buildings to the KCS main line and NAI Partners.