ST. JOSEPH -- What a difference a few years can make.
In May 1996, when owner Packard Bell Electronics announced it was closing the Zenith Data Systems factory in St. Joseph, the future of the 532,000-square-foot building looked pretty bleak.
But as fate, and perhaps a twist of irony would have it, the ZDS building has actually outlived its namesake.
When Packard Bell announced it moving production of ZDS computers to California, there were 570 employees locally. Production ended about July 1, 1996.
Three years after ZDS left, the building is 62 percent occupied with 13 tenants, employing approximately 375 people.
"It was kind of depressing at first when Zenith (Data Systems) said they were moving out," said Gary Hull, facility manager for the Hilltop Road complex. "But after I realized they really were going to close, I just kind of got optimistic and excited about filling the building up again."
Groupe Bull of France, or Bull HN as the company is now called, still owns the St. Joseph property. Bull purchased ZDS from Zenith Electronics Corp. in December 1989 and gave ownership of ZDS to Packard Bell in April 1996. (Bull and Japanese computer maker NEC each owned 19.9 percent of Packard Bell, which specialized in home computers. To boost their investment in Packard Bell, which was struggling, Bull gave it ownership of ZDS and NEC invested $283 million. Packard Bell produced the last computer in California bearing the ZDS brand name in October 1997.)
Bob DeVito, director of facilities services at Bull HN's North American headquarters near Boston, said it's inevitable the property will be sold.
"We'd like to have the building sold within a year, but there's no rush," he said. "The building has a positive cash flow."
DeVito added that Bull has four serious prospective buyers of the building, one in Michigan and the other three from the Chicago area.
But before Bull sells the building, DeVito said he would like to see a few more tenants.
"When ZDS moved out, we basically put the building on the market then," DeVito said. "It's roughly 60 percent leased now and we're talking with a few people (prospective tenants) that would bring that up to 70 percent."
Rieter Automotive, a subsidiary of a Swiss textile company, is ZDS' largest tenant, employing 206 people. Rieter leases 213,000 square feet of space, which encompasses ZDS' former distribution warehouse.
Rieter manufactures aluminum heat shields and soundproofing insulation for cars, trucks and farm and construction equipment.
The property's second largest tenant is Eagle Technologies, a locally-owned business that makes specialized assembly systems for manufacturers. Eagle leases 50,000 square feet and employs approximately 50 people.
Other tenants are Cedarwood Medical Center administrative offices, Design Incentives, Shamrock Janitorial, Nellson Specialties Co., BTS Telecom, G&A Services, Metro Business Archives, Ray's Tool Distribution, Lutheran Brotherhood insurance, Southtown LLC, and Peg Williamson Employment Services.
"At the time ZDS announced its plans to move, we had about 1,300,000 square feet (of empty buildings) on the market," said Cornerstone Alliance President Jeff Noel said. "Since then, all of those buildings now have new tenants."
Once word hit that ZDS was moving, the economic development organization went to work assembling a task force. Cornerstone created marketing materials and mailed 30,000 informational pieces to prospective tenants/buyers.
Noel went to Boston and met face-to-face with Bull HN executives to discuss a plan of action for the property.
At the same time, Cornerstone staff put together incentive packages to lure new business prospects to the area, with aid from state and local government.
"We didn't invest any time in moving a company from within the community to move to the ZDS building," said Jeff Noel, Cornerstone's president. "We don't ever want to compete with existing buildings. So we did not nor will we ever do that."
The part of the building that remains vacant includes many of the front executive offices, including that of the former ZDS president, the cafeteria and a large sprawling area divided by more than 100 cubicles.
Hull predicts the building will be close to 90 percent rented within two years.
He said the building can accommodate almost any type of tenant, with the exception of retail "It's not zoned for that," Hull said. "But if they wanted retail space, I guess we could always look into it."
In the meantime, Noel looks at the whole experience as a move that could have easily been disastrous to the area's economy, but instead became a wake-up call. "The success of the ZDS building is really a reflection of the success of this community," Noel said.
The only criticism Noel has for Bull HN is that the company went with a regional real estate broker, as opposed to Cornerstone's advice to hire locally.
"I think they would agree that that was a mistake now," he said.
DeVito said regardless of ZDS closing, many of the actions taken over the last three years have been made with the best interest of this community in mind.
"We didn't want to walk away from it and leave the community high and dry with an empty building," DeVito said. "We never looked at it like 'let's get rid of this thing'."