The $11.5 million purchase of the shuttered Danfoss plant and unveiling of the Hostess Brands Inc. signage this year marked a new chapter for the Clark County factory.
Local leaders welcome the arrival of the famed Twinkie maker as a big step toward restoring the fortunes of an industrial property where hundreds were hired and laid off during its 40-year history.
Economic boosters hope the promise of 150 new jobs during the next three years will be merely the first batch served up by the snack cake maker. Hostess is investing more than $120 million to transform the former compressor plant into what company officials describe as the bakery of the future.
The Little Rock construction-design team of Baldwin & Shell Construction Co. and Cromwell Architects Engineers are working toward completing the conversion during the second half of 2023.
“We’re on time and on budget,” Hostess CEO Andrew Callahan said at the Sept. 15 corporate sign celebration at the Clark County Industrial Park. “That’s always good.”
Initial Arkansas production will be devoted to Donettes, the mini-cake donut with mainstay varieties of powdered, double chocolate, glazed, frosted chocolate and crunch. Touted as the No. 1 mini-donut brand in America, Donettes also are produced in seasonal offerings of strawberry cheesecake, caramel crunch and strawberry.
With more than 330,000 SF under roof, the facility 4 miles south of Arkadelphia will be the largest of six Hostess bakeries. Located on 41 acres, the plant’s existing configuration has sufficient room to accommodate four production lines. But the company is only building one for now.
Based in Lenexa, Kansas, Hostess operates four U.S. bakeries: in Columbus, Georgia (313,700 SF); Emporia, Kansas (278,500 SF); Indianapolis (195,000 SF); and Chicago (137,000 SF). The company also operates a 250,000-SF bakery/distribution center in Burlington, Ontario, part of the $320 million acquisition of Voortman Cookies Ltd. in 2020.
Earlier this year, Dan O’Leary, chief growth officer at Hostess, told investors that the plant renovation in Arkansas is following a sustainability-first design.
“Unburdened by pre-existing constraints, this facility will leverage all of the best practices accumulated across our bakery network to become our most efficient and flexible operation,” he said of the company’s commitment to make the bakery its greenest.
To add some financial sugar to the deal, the economic development group is giving Hostess $2 million conditioned on the creation of at least 150 jobs.
The hiring of bakery employees for the 2023 reopening will mark the second time the plant has undergone a manufacturing makeover.
The facility opened as the home of Fafnir Bearings in the early 1980s and employed as many as 500. By 1987, the plant was closed in the wake of Fafnir’s acquisition two years earlier by the Torrington Co.
The property sat idle until 1990 when the Carrier Corp. purchased it for $6.2 million and invested a reported $100 million to shift production from bearings to residential air-conditioning compressors.
In 1995, Carrier’s joint venture with Johnson Controls led to a name change: Scroll Technologies. Employment stood at 575 in 1999 when the facility was named among the top 10 best plants in the nation by IndustryWeek magazine.
Scroll Technologies was a point of pride for the Arkadelphia area. The plant was an innovative industrial workshop where staffers held 80 product design and manufacturing process patents for next-generation air conditioners.
“It was a fantastic employer with world-class engineers who gave us wonderful employment for years,” said Bill Wright, an active participant on Clark County’s economic development scene for more than 35 years. Over time, the product line expanded to include commercial air-conditioning components. At its peak, Scroll Technologies employed more than 700 before overseas manufacturing took its toll.
The venture was sold to an international manufacturer of compressors and other refrigeration components in 2006: Danfoss Group of Nordborg, Demark. Beginning in the 2000s, overall employment declined amid waves of layoffs and hirings.
Under Danfoss ownership, the plant employed as many as 500 in 2009. The headcount stood at 170 when its closing by year’s end was announced in January 2020. Eight months later, Danfoss sold the property for $5 million to a New York investment concern.
“The plan was to lease it,” said J. Holmes Davis IV, senior vice president and partner at the Dallas office of the Binswanger commercial realty firm.
“We had it on the market for about a year, and then Hostess approached us about buying it late last year.”
Hostess executives cited a string of year-over-year quarterly sales growth of 9% or more as the fiscal motivation for the company seeking a new bakery location, which resulted in good news for Clark County.
“A lot of people who have scattered from Scroll are interested in coming back,” said Wright, western region CEO at Arkadelphia’s Southern Bancorp Bank.
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