CASE STUDY
Brooklyn Bedding
Manufacturing, Distribution Center, Showroom, and Office
Phoenix, Arizona
Phoenix, Arizona
PROBLEM Brooklyn Bedding became a number one seller on Amazon.com and had an urgent need for a solution to address the growing operational demands. Operating out of 3 buildings the bedding manufacturer required a more optimal solution. Inefficiency costs were crippling their profit margins and order demands limiting future growth. Brooklyn Bedding has now grown to a $100 million private company with a Made in America culture. The products include the Brooklyn Bedding brands, manufacturing private label brands and in 2019 manufacturing their own springs. Their local delivery trucks even proudly display Made in Arizona!
PROCESS Brydant began working with ownership to gain a clear understanding of where they wanted to go and how they wanted grow. It was clear their Bed-in-a-Box concept was going to be a huge success. We performed a site search of newer existing buildings available for lease, expanding the search to older off-market existing facilities for purchase. Most of the older buildings required a minimum of $500K in improvements. A Lease/Purchase Analysis determined that Brooklyn Bedding would benefit from owning a facility with monthly mortgage and property expenses 20% less than leasing. In addition, at the time an owned real estate asset could be a better fit for their exit strategy by adding value to the corporation.
SOLUTION The team, including Brooklyn Bedding’s Operations, Marketing, and Finance groups, determined a145,000 SF facility situated on a high visibility street such as Camelback Road would handle their growth. We selected a location with high visibility and not subject to infrastructure impact fees which saved $1.75M in total costs overall. Brydant ensured the design met the quality and standards of institutional investors resulting in a building more versatile to accommodate distribution, multi-tenant, and manufacturing with a retail component for exit strategy options. Brydant secured the land, coordinated the design, entitlements, contractor selection, and assisted in economic development incentives at the state, regional, and municipal levels. The project was constructed with a Design-build method. Brydant also assisted the owner with securing an SBA financial structure, which at the time was the largest SBA loan in the state. Late 2018, Brydant assisted the owner with a short-term lease of 140,000 SF just south of the existing owned building. The extensive growth of this company has already found the two facilities inadequate to handle the ever-growing demand of both their branded and private label products.
CONTINUED GROWTH After an extensive site search and numerous meetings with the executive team, Brydant assisted the owner with the purchase of an off-market 42-acre parcel just north of their current facility. The location is where their 300+ factory employees live, which many of them have been with the company for more than 10 years. With the addition of manufacturing both rigid and flexible spring foundations and the extraordinary growth of both their own brand and private label, it has been determined that the development of another facility totaling 600,000 square feet will meet their long-term needs. The new site will allow them to continue to grow in the long-term. Brydant has brought in an investor and is currently evaluating the benefits of partnering with the owner for the development of the project which will enable the owner to reinvest capital into operations. This project will exceed $40 million. Brydant assisted the owner in the sale of their current Camelback Road facility resulting in net proceeds of $5.4 million which the owner can invest in the new project. The 5 year hold of the building delivered a 56.5% return on investment!
For more than 7 years, Brydant has been a trusted advisor and ostensibly the company’s corporate real estate department.
PROCESS Brydant began working with ownership to gain a clear understanding of where they wanted to go and how they wanted grow. It was clear their Bed-in-a-Box concept was going to be a huge success. We performed a site search of newer existing buildings available for lease, expanding the search to older off-market existing facilities for purchase. Most of the older buildings required a minimum of $500K in improvements. A Lease/Purchase Analysis determined that Brooklyn Bedding would benefit from owning a facility with monthly mortgage and property expenses 20% less than leasing. In addition, at the time an owned real estate asset could be a better fit for their exit strategy by adding value to the corporation.
SOLUTION The team, including Brooklyn Bedding’s Operations, Marketing, and Finance groups, determined a145,000 SF facility situated on a high visibility street such as Camelback Road would handle their growth. We selected a location with high visibility and not subject to infrastructure impact fees which saved $1.75M in total costs overall. Brydant ensured the design met the quality and standards of institutional investors resulting in a building more versatile to accommodate distribution, multi-tenant, and manufacturing with a retail component for exit strategy options. Brydant secured the land, coordinated the design, entitlements, contractor selection, and assisted in economic development incentives at the state, regional, and municipal levels. The project was constructed with a Design-build method. Brydant also assisted the owner with securing an SBA financial structure, which at the time was the largest SBA loan in the state. Late 2018, Brydant assisted the owner with a short-term lease of 140,000 SF just south of the existing owned building. The extensive growth of this company has already found the two facilities inadequate to handle the ever-growing demand of both their branded and private label products.
CONTINUED GROWTH After an extensive site search and numerous meetings with the executive team, Brydant assisted the owner with the purchase of an off-market 42-acre parcel just north of their current facility. The location is where their 300+ factory employees live, which many of them have been with the company for more than 10 years. With the addition of manufacturing both rigid and flexible spring foundations and the extraordinary growth of both their own brand and private label, it has been determined that the development of another facility totaling 600,000 square feet will meet their long-term needs. The new site will allow them to continue to grow in the long-term. Brydant has brought in an investor and is currently evaluating the benefits of partnering with the owner for the development of the project which will enable the owner to reinvest capital into operations. This project will exceed $40 million. Brydant assisted the owner in the sale of their current Camelback Road facility resulting in net proceeds of $5.4 million which the owner can invest in the new project. The 5 year hold of the building delivered a 56.5% return on investment!
For more than 7 years, Brydant has been a trusted advisor and ostensibly the company’s corporate real estate department.
“Our new facility enabled us to increase our productivity
by 30-50% while reducing our manufacturing costs by 20%!”
– John Merwin, President of Brooklyn Bedding
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