A Chattanooga real estate firm that has redeveloped a number of manufacturing and urban properties across the South has purchased the Arcade Beauty manufacturing site on Amnicola Highway in Chattanooga and is preparing to redevelop the 10-acre property for other commercial and industrial use once Arcade vacates the property later this year.
Urban Story Ventures paid $11.5 million to acquire the Arcade buildings and property at 3720 and 3800 Amnicola Highway after Arcade Beauty announced in July it was closing the Chattanooga plant by April. Arcade, a 121-year-old company that started in Chattanooga and was long known for making fragrance and cosmetics test samples for magazines and advertising samplers, plans to soon shut down the Amnicola plant site where it has operated since 2010. Arcade is shifting production to its plant in South Plainfield, New Jersey, near its headquarters in New York.
Aracade is keeping a Chattanooga presence with its research and development laboratory moving to a site in the Enterprise South Industrial Park, but it is laying off most of its 84-person production workforce in Chattanooga.
"The plant closure will allow us to improve our asset utilization in North America and further reduce our fixed cost base," Trevor Deighton, Arcade's general manager for North America, said in the statement last year.
Urban Story Ventures, which already owns more than 1 million square feet of manufacturing building space in Chattanooga and is developing The Bend on the west side of downtown Chattanooga, is seeking new industrial and commercial tenants for the Amnicola Highway property.
(READ MORE: The Bend could help bring $800 million of new development to Chattanooga)
"This is the perfect example of the value-add projects we take on, where we improve upon the strengths and reimagine the rest for the highest and best use," Urban Story President Jimmy White said in an announcement of his company's plans for the Arcade site. "It's an amazing facility with solid existing features, and we have the rare opportunity to develop additional space in one of the strongest industrial corridors in a market with an extremely low vacancy rate of about 1%."
White said that by revitalizing and modernizing the property, the buildings and adjacent property will be able to cater to industrial tenants seeking flexible space in a convenient and strategic location. White said Urban Story Ventures is targeting businesses in the logistics, pharmaceuticals, food and beverage, and e-commerce industries.
"Depending on the needs of the new tenant or tenants who move in, we could end up supporting hundreds of new jobs in the market," White said. "I've always believed in industrial and am excited to get to work with recruiting one of Chattanooga's next big employers."
The building at 3800 Amnicola Highway was built in 1971 and includes 139,764 square feet. An adjacent building at 3720 Amnicola Highway was built in 1984 and includes 45,500 square feet, according to Hamilton County property records.
AKI Inc., which does business as Arcade Marketing Inc., acquired the site at 3720 Amnicola in 2011 and bought the 3800 Amnicola Highway building in 2021, according to the Hamilton County Assessor's Office.
In addition to the warehouse, offices and loading docks on the site, the property also includes 9.8 acres of undeveloped land that's already zoned for manufacturing and is located by a traffic light on Amnicola Highway. White said the property has ample parking and can accommodate one or multiple tenants.
Since its start a decade ago, Urban Story Ventures has owned, invested in and managed industrial space in the Southeast from Tennessee to Florida. In its hometown of Chattanooga, the company has helped to recruit such industrial employers as Novonix, Lincoln Electric, HEF USA and Micronics.
(READ MORE: Novonix boosts production at The Bend)
Jorge Garcia, executive vice president and chief financial officer for Arcade Beauty, said Urban Story Ventures' local experience in the industrial market helped to shape the property sale from a number of purchase offers received by Arcade.
"Jimmy and his team seemed to be the right fit," Garcia said in a statement released Friday. "They were local, had strong industrial experience, and it was refreshing to see the new vision and energy for our site."
White said Urban Story Ventures has already begun the planning process for the property, but White said his company will serve as landlord and property manager for the Arcade Beauty team during Arcade's relocation over the next four months.
Contact Dave Flessner at dflessner@timesfreepress.com or 423-757-6340.