Also reaches sale-leaseback agreement with new buyer for Wilsonville, Oregon, footwear distribution center
BEAVERTON, Ore. (March 2, 2007) – Nike, Inc. (NYSE: NKE) today announced
that it has reached an agreement to acquire a 125-acre land parcel in
Memphis, Tennessee, known locally as Northridge, where it plans to build
a new 1 million square foot footwear distribution center. The land
purchase agreement was signed March 1, 2007, by Nike and Memphis-based
Belz Enterprises.
In a related demonstration of confidence for the project, the Industrial
Development Board (IDB) for Memphis and Shelby County also formally
granted Nike's application for making Northridge eligible for Payments
in Lieu of Taxes (PILOT) leases based upon the anticipated job creation
and capital investment. The new facility, located in the Frayser area
of Memphis, had already been designated as an “enterprise zone” targeted
for a large employer to provide economic stimulus to the surrounding
community.
The new facility is expected to house employees from both Nike's
existing Winchester Road facility in Memphis, and employees relocating
from a second distribution center based in Wilsonville, Oregon.
“Nike is pleased to increase its investment in the Memphis community
with this state-of-the-art facility. This distribution center will be
great for our employees, retail customers and consumers while expediting
our time to market,” said Nick Athanasakos, Vice President, Nike Supply
Chain.
A comprehensive business analysis projected several benefits to Nike and
Nike retailer customers including: cost efficiencies totaling more than
$200 million, reduced shipping times and increased service
capabilities.
Belz Enterprises, the sellers of the Northridge site, also view this
sale as more than a simple land transaction. “We are fifth-generation
Memphians and are very proud to add to the area's stature as the capital
of U.S. distribution. Equally important, this project will provide
further economic opportunity to the Frayser area in north Memphis that
vitally needs additional jobs and commerce,” said Ron Belz, President of
Belz Enterprises. “We are pleased to join with our city, county and
state government in continuing the long term and strong presence of Nike
as a major employer as well as important corporate citizen in our
community.”
As a precursor to completing the Northridge purchase, Nike also
announced reaching a sale-leaseback agreement on the Wilsonville,Ore.,
facility with CB Richard Ellis Investors, an institutional real estate
investment manager that purchased the property on behalf of the Illinois
State Board of Investment. The recorded sale-leaseback price was $27.6
million. This agreement will allow Nike's continued operations at the
Wilsonville site through 2008. At the end of the Nike lease, the owner
may seek proposals for new tenants that will capitalize upon the
facility's premier product distribution site.
“The agreement was designed to continue to operate Wilsonville without
disruption to our employees or our business,” Athanasakos said.
NIKE, Inc. (NYSE:NKE) based near Beaverton, Oregon, is the world's
leading designer, marketer and distributor of authentic athletic
footwear, apparel, equipment and accessories for a wide variety of
sports and fitness activities. Wholly owned Nike subsidiaries include
Converse Inc., which designs, markets and distributes athletic footwear,
apparel and accessories; NIKE Bauer Hockey Inc., a leading designer and
distributor of hockey equipment; Cole Haan, which designs, markets, and
distributes fine dress and casual shoes and accessories; Hurley
International LLC, which designs, markets and distributes action sports
and youth lifestyle footwear, apparel and accessories and Exeter Brands
Group LLC, which designs and markets athletic footwear and apparel for
the value retail channel.