Monday, February 6, 2023
Feb. 6, 2023

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Port peppers staff, Coca-Cola bottler with questions about 95-acre ground lease


OLYMPIA — The Port of Olympia commission spent about an hour asking questions about a potential ground lease that would bring a Coca-Cola bottler to a port-owned Tumwater site near Olympia Regional Airport.

The public got in on the questioning as well. Combined, they asked questions about water, jobs, lease terms and whether the proposed lease itself should be reviewed by a third party.

Under consideration is a 95-acre lease with Swire Coca-Cola, a regional bottler of Coca-Cola products that operates in 13 western states, including Washington. The business is based near Salt Lake City, Utah. Swire officials, who attended Monday’s meeting, said the proposed site southeast of the airport near Old Highway 99 could employ as many as 600 people.

Swire would operate a manufacturing facility with an accessory warehouse, the port’s business and real estate development director Allyn Roe said. However, he said the city of Tumwater zoning does not allow distribution warehouses in the area.

The initial phase of the lease would pay the port about $170,000 a year, but once a Habitat Conservation Plan is complete and some details are worked out with the Federal Aviation Administration, the amount would grow to just under $2 million per year.

He called the potential ground lease the “largest transaction in the port’s history.” The lease has a base term of 35 years, but with options it could be extended to 75 years, he said.

However, the port would need to make the case that the site is no longer needed for direct aeronautical use, Roe said.

During public comment, resident Charlotte Persons asked whether there will be enough water, in light of climate change, to sustain a bottling plant.

That prompted Swire Coca-Cola Director of Sustainability Mike Bernier to revisit the company’s environmental goals: A 70 percent reduction in carbon dioxide emissions by 2030, a 100 percent shift to electricity to power core operations by 2026, and a goal of 100 percent recyclable packaging by 2025, he said. The Tumwater site would be outfitted with solar panels, he said.

The business has reduced its water use by 20 percent over the past 10 years and continues to do so, Bernier said. The bottler also has been in contact with the city of Tumwater about its water and wastewater needs.

“Their strategic plan aligns with our needs,” he said.

Port Commissioner Joe Downing asked about manufacturing. The business does not manufacture aluminum cans — those are shipped to it — but it does produce the plastic bottles out of “preforms” that look like small plastic test tubes.

Port Commissioner Bob Iyall asked about jobs. Out of 600 potential jobs, how many new jobs would be created compared to workers transferring in?

“Those plans are not fixed just yet,” said Jenifer Freeman, director of public relations and government affairs for Swire.

Downing asked whether the lease should receive a third party review so that the port is “adequately protected for the next 75 years.” Iyall agreed, saying a third party review would back up Roe’s efforts and be more due diligence for the port and the community’s comfort.

Commissioner Amy Evans Harding, who is a commercial real estate broker, defended Roe’s work, saying he does a good job of balancing all the deal points from a market perspective.

“I’m very confident in the way he arrives at a deal,” she said.

Roe said he would bring more data to the next ground lease presentation, and show how the port developed its lease rate.

The next presentation is set for Dec. 12, when the commission also is set to vote on whether to approve the lease.