With the Arkansas Economic Development Commission (AEDC) last week approving a $750,000 bond guaranty to a Texas-based investment group, the former ArkLam and Unit Structures plant in Magnolia is set to see new life at its 1202 Shanhouse Drive mill. The state funding measure was the first public step in creating at least 40-60 jobs over two years in the city. The Magnolia plant, most recently under the name ArkLam, had been closed since 2015. The new jobs are expected to pay approximately $35,000 annually.
The state funds were approved for Texas CLT LLC of Timpson, Texas. The group is also expected to invest $3 million initially in the project.
The new occupiers of the roughly 20-acre property located just southwest of Southern Arkansas University’s Physical Plant will not specialize in the same traditional glued laminated beam business that the Magnolia plant manufactured for 50-plus years, but instead, it will produce the similar, yet more environmentally sustainable and fire resistant cross-laminated timber (CLT) technology.
The Nacogdoches, Texas-area investment group is already familiar with the timber business. Brant Cobb, chief operating officer of Texas CLT, also owns Cobb Lumber Co. in Timpson. There, it manufactures and supplies clients with utility poles, pilings, timbers, posts, geotextiles, lumber, and erosion controllers.
The CLT market, though, is seen as an emerging and fertile investment area. Unlike many wooden products, CLT is much more fire resistant due to its highly compressed fillings, more environmentally friendly, and lighter than the traditionally laminated beams.
The plant expects to be operating in January.
Since the Magnolia building was built in the 1950s, a series of owners – the latest being a 10-person local investment group led by Michael Kinard – have produced laminated beams.
According to Columbia County real estate records, ArkLam, or Arkansas Laminating, purchased the plant in 2012 from Unit Structures LLC, which had owned the property since January 1996. It purchased the business from Engineered Wood Systems, Inc., 10 years prior. The 2012 ArkLam investors, whom still own the land, are expected to lease the plant property to Texas CLT.
Magnolia Economic Development Director Cammie Hambrice and Magnolia Mayor Parnell Vann have been intimately involved since March in helping Texas CLT fill the vacant ArkLam mill.
On Friday, Hambrice said the process came rather quickly, but the pieces are now in place for the town to benefit.
“We’ve been working on this since early spring, locally,” she said. “It’s really the first big project since the city took over economic development.”
Hambrice and the mayor were and still are in regular contact with all partners involved. They have traveled to Little Rock to meet with AEDC, and the Arkansas Development Finance Authority, plus spoken frequently with the Magnolia investors, and the Texas group led by Cobb.
Even as AEDC has already approved its bond measure, and the Texas group pledged its investment, the city council of Magnolia will still need to grant final approval for its local economic tax dollars to be spent on the project.
“Locally, we will have skin in the game,” said Hambrice.
Hambrice added that the Magnolia economic funds will aid in the hiring of new workers.
“We will run a cost-benefit analysis, and then the city council will have an opportunity to review the information and vote to allocate funds to the project,” she said in a Friday statement. “I received a call yesterday from Drew Williams, AEDC Project Manager, informing me of the $750,000 bond guaranty approval.”
The exact economic funding amount the city will invest has yet to be disclosed.
Hiring for the new workforce will be performed through area firms such as Workforce Services, Manpower, and ESA Staffing. Hambrice also said that former ArkLam workers will be contacted for the new job openings.
With such an emerging market, the investment is thought to be a sound one for all parties involved.
“It’s really picking up steam,” Hambrice added.
Vann on Friday also highlighted just how perfect of a fit the CLT business is for Magnolia.
“Located in the timber basket of south Arkansas, we have the resources they need,” he said.