Landlocked around its headquarters in Apple Valley, Minnesota, Uponor North America is buying manufacturing facility and offices about 70 miles away to keep pace with demand for its cross-linked polyethylene pipe.
The 237,000-square-foot factory in Hutchinson, Minnesota, was previously owned by Hutchinson Technology Inc., which made suspension assemblies for disk drives at the site before it was acquired by TDK Corp. in 2015.
Uponor plans to invest $6.5 million in Hutchinson, including the cost of the building and surrounding land, and put the plant back into production by early 2019 to fill orders for PEX products for plumbing, fire sprinklers, and radiant heating and cooling systems.
“Uponor is seeing unprecedented product demand as a result of continued growth in commercial and residential construction,” Uponor North America President Bill Gray said in a news release.
This is the company’s 11th expansion since operations began in Minnesota in 1990. The last growth spurt was announced just a few months ago, when Uponor officials said they would invest $17.4 million into the Apple Valley campus. That project, which should be completed in January 2018, pushed Uponor to the limits of further development by the headquarters.
Despite all the expansions, Uponor still needed more manufacturing space, Uponor Corp. President and CEO Jyri Luomakoski said in a news release to investors.
“We have witnessed weaker than anticipated net sales in development in Building Solutions-North America in the first half of the year, which has partly been caused by our inability to meet customer demand for our products,” Luomakoski said. “The new facility in Hutchinson will allow Uponor to increase production capacity, pending regulatory approvals, in time to satisfy expected growth in demand in 2019.”
Uponor expects to close on the Hutchinson purchase in late August.