Roanoke Times
Copyright (c) 1995, Landmark Communications, Inc.
DATE: SATURDAY, January 8, 1994 TAG: 9401080144
SECTION: VIRGINIA PAGE: A1 EDITION: METRO
SOURCE: DAVID M. POOLE STAFF WRITER
DATELINE: LENGTH: Medium
Last summer, the company's payroll fell to about 100, far below the 2,000 jobs that were envisioned when ground was broken for the facility in 1989.
That's why officials from both counties wanted reassurance when a New Jersey company that bought Tweeds last fall began talking about bringing hundreds of catalog warehouse jobs to the Roanoke Valley.
On Friday, Hanover Direct Inc. signed an agreement that effectively commits the company to creating the equivalent of 695 jobs in the area by 1996.
Hanover Direct, the nation's fifth-largest specialty mail-order company, will have to pay back part of a $2.1 million incentive package if it does not meet its employment goals, according to the agreement.
Hanover President Jack E. Rosenfeld was welcomed to the area at a news conference sponsored by the Roanoke Valley Economic Development Partnership.
Rosenfeld said he was pleased that the move should not mean the loss of jobs at the company's main warehouse facility in Hanover, Pa.
"I think everyone here should feel good that the jobs we are creating here are not displacing jobs in another part of America," he said.
The Hanover Direct jobs will be created at two sites:
A 54-acre tract on Old Hollins Road, where the company plans to build a 495,000-square-foot distribution center for Domestications, a home furnishings catalog with annual sales of more than $300 million - the company's largest. The site is to employ the equivalent of 276 full-time workers by early 1995 and a total of 325 by the end of 1996.
The 175,000-square-foot Tweeds building in the Jack E. Smith Industrial Park developed jointly by Botetourt and Roanoke counties. The company will nearly double the size of the building and create the equivalent of 188 full-time jobs by 1995 and a total of 370 by 1996.
The company defined "full-time" employees as those who work at least 30 hours a week and are eligible for company benefits.
The actual total of jobs created may be less than 695, because Hanover Direct can take credit for jobs it has created at Tweeds since acquiring the women's fashion apparel catalog in October.
Hanover Direct officials hope to expand the Tweeds business and move some of their other apparel operations to the building, which has been underused since it was built in 1990. They said far less than 50 percent of the facility is being used.
Hanover officials said their marketing study shows the area has a work force large enough to absorb nearly 700 jobs.
J. Robert Rhudy, vice president for distribution, said that although existing warehouse operations have trouble hiring seasonal, part-time workers, the marketing study shows a strong demand for full-time jobs.
Rhudy said the wage scale for hourly workers will range from $6 to $10 an hour, slightly lower than the wages paid at its nonunion operation in Pennsylvania.
Rosenfeld said the company considered sites in eight states before selecting the Roanoke Valley.
He credited many people - including Rep. Bob Goodlatte, R-Roanoke; Roanoke County Administrator Elmer Hodge; and Regional Partnership Executive Director Beth Doughty - for selling the area to Hanover Direct.
"You have some very, very able and persuasive people," Rosenfeld said.
The $2 million incentive package also helped:
Roanoke County agreed to use $900,000 of its state Department of Transportation allocation to widen a mile of Old Hollins Road and to place a traffic light at Old Hollins and Plantation roads.
The Virginia Department of Economic Development will provide $300,000 worth of training for new employees.
The Governor's Opportunity Fund will provide a $350,000 grant that Hanover Direct can use at its discretion for improvements to the Old Hollins Road facility.
Roanoke County will spend $275,735 for 15 acres of the Old Hollins Road site and donate the land to the company.
Botetourt and Roanoke counties will spend $191,962 for 15 acres adjacent to the Tweeds building and donate the land to the company for future expansion.
Roanoke County will spend $230,000 to extend water and sewer service to the Old Hollins Road site.
Botetourt and Roanoke county officials say they expect to recoup their investment in less than three years from taxes generated by the Hanover Direct operation.
The Roanoke County calculations do not include the $900,000 for road improvements, which county officials say may be provided by a special Department of Transportation allocation.
by CNB