Scuttlebiz: Starbucks expansion a testament to area’s veteran-filled workforce

The big news this past week was Starbucks nearly doubling the size of its Augusta coffee-roasting plant.

 

Local and state media outlets covered the news as expected. All of them, including The Chronicle – which, ahem, was the first to report the story – focused on the essentials: $120 million in investment, 100 new jobs, 140,000-square-feet of new space, the addition of a new product line and so on.

But one minor detail ended up on the cutting room floor, a detail I’d now like to expand upon: One in every six employees at Starbucks’ Augusta plant is a veteran or military spouse.

That’s a pretty impressive ratio for a 180-employee operation, even in a “military town” like Augusta.

Starbucks is not a charity. It’s a for-profit venture that earned $5 billion last year selling $21 billion worth of coffee and other goodies worldwide. It does not hire or retain employees (“partners” as it calls them) who aren’t up to snuff.

Obviously, there are tangible benefits to hiring military-affiliated personnel.

Before Starbucks went public with the announcement, a company spokesman told me veterans’ skills and work habits mesh well with the needs of Starbucks’ 180,000-square-foot (soon to be 320,000-square-foot) south Augusta plant.

What does the Seattle coffee giant want in an employee? The same thing everybody else does: someone with integrity, motivation and responsibility. Someone who can lead, but also work well within a team. Someone who respects policies and procedures, someone who is conscious of health and safety standards, and someone who – above all – is committed to his or her organization.

Unless universities have changed significantly in the 22 years I was awarded a degree, those skills are the domain of one organization: the military.

There’s a reason major local employers attend job fairs at Fort Gordon, and it’s not just because they seek special job tax credits for hiring veterans. They want people who work.

Just a month ago, at a Georgia Chamber of Commerce event, an executive at the local John Deere assembly plant said that if he had the ability, he’d hire nearly everyone separating from the service at Fort Gordon. And I know exactly why he said that.

When I was a temp years ago at Deere’s Grovetown tractor assembly plant, I worked near a fellow who wore a “Vietnam Veteran” hat who was old enough to be my father. The part he produced was used on a different model, but we essentially did the same job.

He never missed work. He never showed up late. He never left early. And he performed like a Swiss watch.

My workspace was tidy; his was immaculate. Quality control flagged my assemblies a few times for missing bolts or an improperly placed decal; his looked like they were made by a robot.

The point is: If metro Augusta’s veteran-heavy local workforce wasn’t tremendously capable, Starbucks wouldn’t have made two major investments here (remember, its existing plant cost $172 million).

“There was a lot of anticipation leading up to the announcement. The partners here understood we were in the running and were hopeful,” said Tim Filipowski, manager of Augusta’s Starbucks plant. “I think (the decision) reaffirms the faith that the senior team had in the work the partners have done here.”

About 150 people leave the service each month at Fort Gordon. A large percentage indicate they want to stay in the area. I think it behooves everyone here to give them that opportunity.

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CONTINUED CARE: Another good-news announcement during the past week was the consummation of University Hospital’s acquisition of Trinity Hospital of Augusta.

There are a lot of folks out there who admire Trinity’s unique place in Augusta history and lament the end of that heritage, and I’m one of them. My wife was born there. My primary care doctor was a staff member there. And I rank the surgery I underwent there several years ago as being among the best health care experiences I’ve ever had.

But let’s face it, nobody else lined up to purchase the financially troubled and operationally challenged hospital from its Tennessee-based majority owner/operator Quorum Health Corp. There were two options: A purchase by University (and continued employment for most Trinity employees), or total closure (with mass layoffs and an empty building).

As University CEO Jim Davis told me when the $16 million deal was first announced in March: “Nothing says ‘ugly’ in a community like a shuttered hospital.”

You don’t have to like the new University Hospital Summerville campus, but you should at least appreciate that it’s not 300,000 square feet of vacant space.

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THE LAST SUPPER: On June 30, the night the University-Trinity deal closed, the Garden City Steak and Grill was serving its final meal.

As The Chronicle’s Buzz on Biz affiliate reported, the home of the former The Snug restaurant on Davis Road in west Augusta cooked its last prime rib. Owners Tom and Christine Sparks, who purchased The Snug in 2015 and renamed it last year, now have the property on the market.

The truly sad aspect of the closing is that the Sparks were longtime patrons of the business before they purchased it. They even had their first date there about 20 years ago, with Tom remarking to Christine that “someday I am going to own this restaurant.”

“We loved this restaurant so much – the food, the service and the atmosphere,” the couple said in a bittersweet Facebook post. “We didn’t see how it could possibly fail. Thank you to everyone who supported this endeavor and helped us ‘take a shot.’ We will always be grateful.”

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NEW OWNER, NEW NAME: It appears that Madison on the Green, the, uh, less-than-upscale apartment community just off Washington Road, is under new management.

The New Jersey-based owner, Lexerd Capital Management LLC, sold the nearly 15-acre property on River Ridge Drive to a corporate entity affiliated with Atlanta’s Arcan Capital for $14 million, according to county property records.

The 276-unit complex, which has been renamed The Enclave at Augusta, is partly sandwiched to the west by the new Lidl on Alexander Drive and the National Hills Shopping Center to the east.

Arcan Capital’s self-description on its website gives some insight as to its motivations for buying the 45-year-old property: “We seek to acquire quality apartment properties that meet our criteria at discounts to replacement cost. Our criteria for both investment and management includes a focus on well-located but underperforming A-, B- and C-class apartment properties in secondary and tertiary markets. We then improve those properties through a combination of fresh and intensive management and by taking advantage of every opportunity to unlock and add value.”

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RENTAL RATES: A one-bedroom at The Enclave, by the way, is going for $615. That, according to apartment aggregator Zumper.com, is about 5 percent below the $650 median rate for a one-bedroom in Augusta. The San Francisco-based company says the national median in July for a one-bedroom dropped 1.7 percent to $1,149, while a two-bedroom fell 1.8 percent to $1,367.

Zumper says Augusta’s rents put it No. 84 on its list of 100 cities, just ahead of Spokane, Wash., but below Greensboro, N.C. The most expensive rental rates should come as no surprise: San Francisco ranked No. 1 with a median one-bedroom rate of $3,450 while New York was second with $2,950.

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DOWNTOWN DWELLING: Ask any developer, real estate agent or property owner with an interest in creating market-rate housing in downtown Augusta and they’ll all tell you the same thing: Low rents are a major disincentive to build new units.

Yes, apartments in downtown Augusta carry a premium, but not so much that it spurring large-scale construction of new units.

Now, someone like Bryan Haltermann, a major player in downtown redevelopment, can make the numbers work because he takes on bite-size pieces one at a time. You can see his handiwork in progress at 901 Broad St., a building being converting into nine loft apartments over a 3,000-square-foot commercial space.

You can bet every one of those apartments will be leased before the final coat of paint dries. And the building’s proximity to the city’s convention facilities almost guarantees the ground floor space will house some sort of restaurant/bar/coffee shop – possibly a national chain.

After all is said and done, Haltermann’s 13,000-square-foot venture will likely end up clocking in around $2 million. Most people wouldn’t consider that chump change. But think about how much it would cost to take on the 10-story Marion Building. Or how about the 100,000-square-foot Lamar Building? Or one of the many rapidly deteriorating buildings whose owners will likely take their extravagant expectations and dirt-cheap deeds to the grave?

For those kind of buildings, you’re talking real money. The kind of money many investors aren’t willing to part with, given Augusta’s current appetite for downtown living. Note that I said “current,” not future.

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SPEAKING OF DOWNTOWN LIVING: Five years after the former J.B. White department store building at 936 Broad St. opened as a 51-unit luxury condominium complex, property managers report the last remaining unit has been sold.

Most people forget that 80,000-square-foot building (parking included) sat vacant from 1978 until a local investment group purchased it in 1999.

The point of this downtown dwelling discussion is that urban residential projects (the non-subsidized kind) take a lot of time and a lot of money to develop, and that the number of investors willing to dive into the deep end of that pool are few and far between.

The good news is that investing in downtown is becoming a less-risky proposition all the time. Space in downtown Augusta is becoming more valuable, thanks to investments such as the Engler family’s Hyatt House on Broad Street’s 1200 block, Augusta Riverfront LLC’s new Marriott-affiliated hotel next to the city convention center and the recent purchase of the Downtown Family Y building by software firm TaxSlayer, which plans to move more than 100 programmers in Columbia County downtown.

It’s clear that people – particularly young tech professionals and empty nesters – want to live, work and play in downtown Augusta. So perhaps that “small” number of people willing and able to take the plunge will get much bigger. And, hopefully, much sooner.

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Reach Damon Cline at (706) 823-3352 or damon.cline@augustachronicle.com.

 

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