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Eberspächer North America: Creating a Real Estate Strategy

May 31, 2017 Case Study 2 min read

Eberspächer GmbH, a €2.2 billion privately owned, international vehicle supplier based in Germany with roots dating back to 1865, began an aggressive North American growth plan when it formed Eberspächer North America in 2000. The plan was to gain a foothold in the North American auto industry by leveraging Eberspächer’s strong tradition of providing leading edge technology.

With $385 million in revenue nine years later and significant revenue growth planned based on forthcoming contracts, Eberspächer North America is now the continent’s leader in diesel exhaust systems. Its industry-leading line of diesel engine after-treatment systems reduces sooty particulate emissions and smog-causing nitrogen oxide emissions by 90 percent. This technology is designed to meet the new, stringent EPA standards, which take effect in 2010.

An award of several large, new contracts led Eberspächer North America to re-assess their North American manufacturing strategy. With a significant plant expansion as part of this process, Eberspächer North America engaged Plante Moran CRESA, the real estate consulting affiliate of Plante & Moran, PLLC, to perform a strategic analysis aimed to proactively align the company’s real estate strategy with their overall corporate growth plan.

Plante Moran CRESA performed an unbiased comparison between several states, which encompassed a national site selection, real estate and capital structure analysis, a financial comparison of lease, buy, and build options, a sale/leaseback assessment, and incentive analysis. Working together with Plante Moran CRESA, Eberspächer was able to identify and implement an optimal real estate strategy.

As a result of Plante Moran CRESA’s analysis, Eberspächer North America opted to focus the expansion of their manufacturing operations in Michigan and Alabama. Subsequently, Plante Moran CRESA performed an extensive site search in conjunction with Eberspächer North America, and ultimately negotiated a 100,000-square-foot lease in Wixom, Mich., and a 50,000-square-foot lease in Cottondale, Ala., to accommodate Eberspächer North America’s expansion. As part of this process, Plante Moran CRESA identified and procured approximately $10 million in economic development incentives on Eberspächer North America’s behalf.

Plante Moran CRESA is a commercial real estate consulting firm providing tenant representation, project management, and real estate consulting services. Its experienced professionals provide unbiased, fully integrated real estate services for small, midsized, and large companies. To better serve and advise its clients, Plante Moran CRESA is affiliated with CresaPartners, one of the nation’s largest pure tenant representation and corporate services firms. CRESA’s alliance with AtisReal International further extends Plante Moran CRESA’s services by providing global companies with a single point of contact.

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