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Former Sony Corp. plant near New Stanton auditions for new tenant

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Wednesday, June 23, 2010
 

The cavernous Sony Corp. plant near New Stanton presents a challenge: to fill more than 2 million square feet of industrial space during a recession, real estate agents said Tuesday.

But it's also an opportunity for employers, they said.

"This is the largest block of space available in Western Pennsylvania. ... The region has the opportunity for a major employer to come here," said Jason Stewart, an executive vice president with commercial real estate firm Grubb & Ellis, during a tour for 25 commercial agents and brokers.

They said the 2.2 million square feet of space available in the plant in East Huntingdon and the 330 acres of land around it have tremendous potential for employers — it is available almost immediately, and space can be carved out to suit a tenant's needs.

Officials are hoping to land light industrial companies or advanced technology firms that will replace the jobs lost when Sony closed its television-set assembly operations last year.

"It has all the attributes — the utilities and access" to the plant via the Pennsylvania Turnpike and Interstate 70, said Rick O'Brien, a senior vice president with Jones Lang LaSalle, a commercial real estate firm Downtown. "With Sony and its supply chain leaving the area, there is a readily available work force," he said.

Sony shut down production last year as part of a larger corporate restructuring, but it will not vacate the plant until its lease expires on Oct. 31.

Sony built thousands of televisions in the plant between 1992 and 2009 and employed as many as 2,700 workers in 2003. Now, only 20 people are working, most of whom are cleaning out remaining office supplies. A lone worker is assigned to repairing televisions, said Ken Camella, facility engineer for Sony.

A study is being conducted and should be complete by the end of October to determine the best uses for the plant, the cost of maintaining it and how to market it locally, nationally and internationally, said Daniel C. Sharek, engineering services director for the Regional Industrial Development Corp., Downtown. It partnered with the Westmoreland County Industrial Development Authority in Greensburg on the study.

If a large-scale employer is considering the plant, "the deal is going to be done on the state level, with economic incentives offered," said Joel Kreider, vice president of transaction services for Grubb & Ellis. Pennsylvania likely would be competing against Ohio, West Virginia, Kentucky and other states for such an employer, Kreider said.

"It may take awhile (to lease). For the right user, it's a home run," Kreider said.

One of the challenges officials face before they sign tenants is paying to maintain the building and convert it to a multiple-use facility, said Larry Larese, executive director of Westmoreland's industrial development agency. The Pennsylvania Industrial Development Authority, which owns the property, has requested $10 million from the state's capital budget, but Larese said double that amount may be needed.

To "break even" on leasing the property, Larese estimated at least 1 million square feet will need to be filled. Currently, Solar Power Industries Inc. of Rostraver and DNP IMS America Corp., which makes bar code ribbons, occupy about 500,000 square feet in the plant.

Some companies that have inquired about leasing space are in the booming natural gas industry, Larese said. He expressed reservations about filling a building with companies tied to a single industry.

"We don't want to have another empty site in 20 years," Larese said.

"Ultimately, we would like to see eight to 10 tenants involved in manufacturing with diverse product lines, so we never have to face another situation like this again," said Larese, who faced the same situation when Volkswagen of America closed an auto assembly plant at the site in 1988, after operating for 10 years.

 

 
 


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