Torrance coffee roaster Farmers Bros. Co. will relocate to Northlake, in Denton County, Texas, company officials announced Tuesday. The choice of Texas was announced after an incentive package was officially approved by local authorities.
The company chose the Dallas-Ft.Worth area over Oklahoma City and, as a result, will receive a 60 percent reduction in property tax bill, according to filings with the Denton County Commissioners Court, and at least 75 percent off the town of Northlake’s property tax bill.
Conditions must be met to take advantage of the incentives, including opening a new facility in a designated location, creating new jobs there and investing in property improvements at the site of the facility.
“We are extremely pleased with the support and assistance of the Town of Northlake and Denton County along with the effort and spirit of cooperation we experienced working with the officials representing those jurisdictions,” Mike Keown, Farmer Bros.’ president and chief executive, said in a statement. “We are working to finalize our plans for relocation and securing eligibility for incentives represents an important step in our process.”
Farmer Bros. told the Business Journal earlier this year that it expected its relocation plan to result in annual savings of from $12 million to $15 million, beginning in the latter half of next year. However, moving will cost the company between $35 million to $40 million in new facility costs with an additional $20 million to $25 million in anticipated capital expenditures for furniture, machinery, equipment and other necessities.
The company expects the cost of moving to be partially offset by profits from the sale of its Torrance headquarters, which company officials believe to be worth as much as $35 million.
Farmer Bros., started in 1912 as a door-to-door sales business, is one of the oldest publicly traded firms in Los Angeles County.
Shares of Farmer Bros. were flat in Tuesday trading to close at $24.79.
Farmer Bros. Chief Financial Officer Mark Nelson did not return requests for comment.
