WILLMAR — Construction is on schedule for completion of the new FedEx Ground distribution center in the Willmar Industrial Park in September, never mind the supply chain challenges bogging down construction projects across the country.
“This project is actually in great shape,” said Carl Ruedebusch, CEO and president, Ruedebusch Construction and Development of Madison, Wisconsin. The company is the developer and owner of the facility. Ruedebusch spoke to members of the Willmar Lakes Area Chamber of Commerce public policy committee on Friday about the project.
His company has been a preferred developer for FedEx Ground since 1980, and has constructed 80 large facilities for the company to date. The company owns the facilities it builds and leases them on a long-term basis to FedEx Ground.
The Willmar facility encloses 217,000 square feet, making it mid-range in terms of size for distribution facilities, according to Ruedebusch.
He said it represents a nearly $30 million project.
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Supply chain issues had a two-fold effect on this project, according to Ruedebusch. There was a longer lead time required for materials, and they are more expensive, he said.
Ruedebusch said many of the materials were ordered before the agreement to build the facility was signed. Some were ordered before the property was purchased, said Aaron Backman, director of the Kandiyohi County and city of Willmar Economic Development Commission.
Strack Construction, of St. Joseph, is the general contractor. It has worked through the winter months to keep the project on schedule. It had to undertake more earth moving than anticipated due to poor fill soil that was on the site, according to Ruedebusch.
He said cooperation from the city of Willmar and Kandiyohi County have been important in the project’s development. “Very smooth and cooperative,” he said of the partnership.
FedEx currently has 100 employees in Willmar, with operations at facilities on U.S. Highway 12 East and Industrial Drive. The new facility will add 100 jobs, bringing total employment by FedEx Ground in the community to 200, according to Backman.
He said FedEx has consistently expressed optimism about finding workers for the new facility. The company has not provided information on wages, but he said his research indicates that full-time employees could make $49,000 in wages, with benefits on top of that.
Ruedebusch Development and Construction did not seek any tax breaks for the project.
“They just said give us a fair price on the land. I think we did that,” said Backman.
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It was noted by meeting participants that local retail businesses are adversely affected by the growth in online shopping made possible by at-home delivery.
In response, the Backman said the project provides significant economic benefits to the community and area. It will provide new tax revenue and new jobs. The operation will also purchase supplies and materials from the area. Many of the truck drivers will be working for independent contractors for FedEx Ground.
Backman said he is also hopeful of spinoff development from this project. He’s currently in discussions with a company looking at a project next to the FedEx Ground site because of it. He said it would be a significant project if it goes forward.
“Momentum leads to more momentum, is the way I would put it,” Backman said.
Operations in the new facility will be highly automated. There will be 66 overhead doors for loading and unloading materials at the site. Large semitractor-trailers will arrive with goods, while vans will distribute the orders to homes and businesses in a large area surrounding Willmar.
Ruedebusch said FedEx Ground uses precise science in determining where to locate distribution centers such as this one.
“This is such a good project that they found it twice. That doesn’t happen often,” said Ruedebusch as he began his address to the committee. He said FedEx initially had planned to build a 100,000-square-foot facility in Willmar. It had selected a developer but pulled the project back.
The second time around, FedEx Ground decided on a 217,000-square-foot facility and Ruedebusch Construction and Development got the bid.
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“We know one thing for sure. Willmar was definitely the right location or it would not be where it is,” he said.
