December 21, 2018

Mathews Brothers expansion to Hermon could mean 100 jobs

Courtesy / Scott Perkins
Courtesy / Scott Perkins
From left, Hermon Town Manager Howard Kroll; Mathews Brothers President Scott Hawthorne; Mathews Brothers Vice President of Operations Kyle Hawthorne; Hermon Town Council Chair Tim McCluskey; Mathews Brother Vice President of Sales John Magri; Mathews Brothers Executive Vice President/Treasurer Alex Hawthorne. Belfast window manufacturer Mathews Brothers expects to close at the end of the month on the purchase of 77 Logistics Lane in Hermon, to expand operations.

Mathews Brothers Co., a window manufacturer in Belfast, is planning an expansion in Hermon that's expected to result in the creation of 80 to 100 jobs.

Company and Hermon officials announced the expansion at the Hermon Town Council's Dec. 20 meeting.

"The positive impacts on our community, not just in Hermon but in central and eastern Maine, will be wide and varied," said Hermon's economic and community development director, Scott Perkins. "It's significant."

"This is truly a family-owned business," Mathews Brothers President Scott Hawthorne said of the 164-year-old company. "We've been peaking. The excitement has been growing to get here and tell you how we excited we are to come to Hermon."

The company plans to expand into an existing 132,000-square-foot industrial building at 77 Logistics Lane. The building is currently owned and operated by Logistics Management Systems, which provides warehousing service primarily to the pulp and paper industry, said Logistics Management Systems Director of Operations Willard Emery.

Mathews Brothers had already been leasing space in Hermon for the past 18 months, in a warehouse on property, near the Logistics Lane property, owned by the transportation company Dysart's, Hawthorne said. Company officials discovered the Logistics Lane property was for sale through an online listing with NAI The Dunham Co., he said.

According to the listing, the property maintains 1,305 feet of rail frontage along the Central Maine & Quebec Railway. The building is serviced by two rail spurs and has 10 access doors with a full coverage rail canopy. The original 59,820-square-foot building was built in 1989 and the additional 72,820-square-foot building was added in 2006. The property was listed for $2.75 million.

"We recognized the landscape and realized it was behind where we are now," Hawthorne said. "We signed a letter of intent Nov. 8 to purchase the building and we're doing due diligence to acquire the building now." The company hopes to acquire the property by the end of December, he said.

Reached by phone after the meeting, Scott Hawthorne said total investment at full build-out in the Hermon property is expected to be $8 million to $10 million. That includes the purchase price of $2.7 million. Renovation includes turning the warehouse, which is non-heated, into a heated manufacturing facility. Renovations include adding insulation, heating system, electrical system, and working with the town to connect to the town's sewer line and natural gas for heating. Bathrooms and parking will be added.

Mathews Brothers ships throughout New England and eastern New York State down to Long Island, and to South America and Australia, with a few shipments to Africa. Over the last couple of years, it's added $3 million of new manufacturing equipment to its Belfast facility. It will be bringing in more new equipment, he said. The company produces 125,000 and 150,000 windows per year. It has grown in double-digit increments since the end of 2011 through 2018, he said. It currently has 170 employees. Plans call for adding 40 more in Belfast, in addition to the 80 to 100 in the next five years in Hermon, he said.

Despite the state's labor shortage, the company hasn't had problems finding new hires, Hawthorne said. He attributed that to in-house training and attraction programs that include an entry-level wage $2 above minimum wage, attendance bonuses for production work of up to $1 per hour and benefits for all employees.

Cheaper than building new

"We're moving to Hermon because it's much cheaper than building a new building," Hawthorne said.

The company had been seeking expansion property for 18 months, throughout central and mid-coast Maine, he said. Initially, the company sought additional storage space for its newest product line, called Sanford Hills. But the line's success called for more production space, he said.

"The thing manufacturing brings to any community is that salaries and benefits are provided with money the company earns from outside the local environment," Hawthorne said. "So you're bringing money from away back to your community. It does great things for the community." Payroll and payroll-related expenditures are estimated for 2018 to be $8.5 million, he said: "A lot of that goes into the midcoast community."

Hawthorne attributed the company's growth to its resident "marketing genius," Marketing Director Robert Maynes.

"He's connected us with some very high-level folks," Hawthorne said. That includes exposure through sponsorships of well-known names like the Howie Carr Show.

Transition period

But first, there will be a two-year transition period, during which Logistics Management will have a leaseback and remain in place, but in a smaller portion of the building.

"We'll continue on as normal for the next two years, but with a little less space," Emery told Mainebiz after the meeting. The first year, Mathews Brothers is expected to take over 40,000 square feet in the original building. In the second year, it's expected to take up that entire building. No decision has been made yet as to what happens to Logistics Management at the end of the second year, said Emery. The building has been on the market since 2013, he added. LMS, established in 1988, has three employees.

"It's too early to tell what's going to happen two years from now," Emery said. "But it's a good transition for Mathews Brothers to grow into our space and a good transition for us to think about how we're going to move forward."

Scott Hawthorne had high praise for Perkins and Town Manager Howard Kroll for their "customer service" in assisting the company. "My job is to create jobs for people in the community. And that's what we want to do," Hawthorne said.

Fast-moving deal

"Hermon is really strong on business development," Perkins told Mainebiz after the meeting. "We love doing that. It makes a great situation for someone interested in moving to central and eastern Maine."

The town started discussions with Mathews Brothers about four months ago, Perkins noted.

"It went pretty fast," Perkins said. "I think the lack of inventory concerning available space and the cost of new construction helped the decision. It's a large space, reasonably priced and a high-quality build inside. I think that's what helped this move quickly. At this current moment, I think it was the only building in central and eastern Maine that size for sale. There are other much smaller buildings, but this was what they were looking for. And logistically, you can throw a baseball at the interstate, Dysart's is next door, and all the trucking and supply businesses are right there on Odlin Road."


Type your comment here:

Today's Poll Does Maine need to refocus on protecting working waterfronts from new development pressures?<>
Most Popular on Facebook