By: Unknown
From: The Knoxville News-Sentinel
Feb. 22--Jewelry Television will take the first step toward an estimated $20 million corporate headquarters along Pellissippi Parkway today when the Knox County Commission votes on tax incentives for the move.
"We're busting at the seams here," Charles Wagner, chairman of the 24-hour shopping network's executive committee, said of the company's current location on Kingston Pike.
"We need to expand to allow us to continue our growth, and more importantly, make a wonderful work experience for our employees."
Company officials have their eye on 50 acres in the northern section of Pellissippi Corporate Center, which sits near the intersection of Pellissippi Parkway and Hardin Valley Road.
The Development Corporation of Knox County owns the land, which is valued at $3.3 million. Under the proposed agreement, Jewelry Television would make quarterly payments totaling $275,000 per year for 20 years -- slightly less than a mortgage at 6 percent.
"They're paying a premium up front, but they're getting the land for free," said Jim Harrison, executive vice president of the Development Corp.
Commissioners vote today on permitting payments in lieu of taxes for that long a time. The current limit is 15 years, Harrison said.
If approved today, the proposal could head to the Development Corporation and Industrial Development Board for final approval as early as next month.
Jewelry Television, formerly America's Collectibles Network or ACN, estimates the preliminary cost of the new facility will be between $20 million and $25 million, with an estimated $8 million to $10 million for furniture and equipment.
Preliminary design is underway and construction could begin in September with a target opening date of March 2007.
Wagner said the company's growth has attracted the interest of other communities but Jewelry Television is committed to staying in Knox County.
"We're a homegrown company," Wagner said. "We're proud to be a Knox County employer. Our goal has always been to stay here."
But, Wagner said, approval of the tax incentive package is essential to the company's relocation.
"Without that approval, we're at square one," Wagner said.
Brandon White pointed to a stack of plastic bins overflowing onto the top and sides of the long metal shelves that hold trays of jewelry and gemstones.
"We're in major cleanup mode. Any time we get a surge of product, you can't walk through here," said White, who oversees product fulfillment, the department where products are matched up with customer orders and sent to shipping. "We can't wait to get a new building."
Over the years, Jewelry Television has repeatedly expanded and made renovations to its headquarters in the strip/warehouse office center it leases on Kingston Pike just east of Pellissippi Parkway.
"We're constantly reorganizing, restructuring," Wagner said.
But the company, which sells jewelry and gemstones through a 24-hour television network that reaches 70 million households across the country, must now limit its growth because of space constraints, Wagner said.
When Jewelry Television moved to Knoxville from Greeneville in 1996, the company leased 7,100 square feet in the Carriage House Walk business mall.
Now, it occupies 85,000 square feet of office, studio and call center space and an additional 50,000 square feet of warehouse space. Most of that space is in the strip mall, which it shares with three other tenants.
"Every time someone moves out, we take over their space," said Kathy Proctor, director of facilities for Jewelry Television. She was hired recently to oversee the move to a new headquarters.
The result is a hodgepodge of noncontiguous space that requires employees from one department to walk outside past another tenant to get to the other department.
"Nothing is connected together. You have to go outside to go inside. It's a challenge. We make sure we have a stash of umbrellas," said Proctor, who said it took her six weeks to learn where everything was.
The company also leases about 14,000 square feet in the former Ethan Allen building next door, and it has plans to soon occupy 7,500 square feet that will become available when Bill Jones Music Center moves out. It also leases about 15,000 square feet of office and warehouse space off Lovell Road.
While space has been limited, Jewelry Television has managed to grow at a phenomenal rate over the years.
Company revenues have grown from $5.2 million in 1997 to more than $300 million in 2004. That number is expected to triple by the end of the decade, resulting in employee growth of about 50 percent, Wagner said.
Founded in Greeneville, the company was launched by former president Bob Hall and other former employees of Shop At Home, a Greeneville shopping network that has since moved to Nashville and been purchased by the E.W. Scripps Co., which also owns Knoxville-based Scripps Networks and the News Sentinel.
Launched in 1993, Jewelry Television is the 19th largest jewelry retailer in the nation, according to National Jeweler Magazine. The company also sells its products online at www.jewelrytelevision.com.
It employs more than 1,500 people, and the new facility would allow the company to add an estimated 750 jobs by 2008. Expected future growth could bring the total to approximately 3,500 employees by 2013.
The company plans to merge its entire operation into the new facility, which will include approximately 200,000 square feet of office, studio and service center space and an additional 100,000 square feet of warehouse space.
Wagner said the company wants to avoid a situation where it runs out of room to grow.
"This space will accommodate that," Wagner said.
Company officials started having discussions with county officials two to three years ago, Wagner said, targeting the Pellissippi area because they wanted something close to their current location, which is about five miles from the proposed site.
The company has contracted with the architectural firm Gensler, which also designed United States headquarters for competitors QVC and HSN.
Wagner said the new building would be designed to be functional and one "that we can actually pay for through improved efficiencies."
Currently, everything is where it is because of the shape of the building, Proctor said.
"The new facility will be designed around the function of how we do business," Proctor said.
Company officials say they envision a campus environment in a park-like setting with walking trails and picnic areas.
And instead of fancy offices, the management team will be in cubicles like everyone else.
"We hope to create more of a community between different groups that never really interact with each other," Proctor said.
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