St. Paul-based Ecolab announced Monday it is building an energy-services headquarters in Sugar Land, Texas, that will triple its current presence in the Houston suburb.
Company officials declined to disclose the building’s cost, but commercial real estate experts said it could easily be more than $25 million once complete in 2015.
The four-story, 133,000- square-foot building will house its Nalco Champion energy-services business, which Ecolab built through two sizable acquisitions in 2011 and 2013.
The building will rise next door to Ecolab’s 45,000-square-foot office in Sugar Land and incorporate research, development and engineering lab facilities. About 1,000 employees will move to it from Ecolab offices in Sugar Land and nearby Fresno, Texas.
“This project will help us bring together our people as one team, creating a critical mass of industry knowledge and a research-and-development powerhouse to better serve our customers,” said Steve Taylor, president of Nalco Champion and an Ecolab executive vice president. “The new headquarters building and related renovation also reaffirms our continued commitment to the city of Sugar Land, where our company has long held a corporate presence.”
Ecolab paid $8.3 billion for Naperville, Ill.-based Nalco two years ago, gaining a large foothold on water treatment services aimed at oil, natural gas and paper mill customers. Nalco, which ran the oil and gas services part of its business out of Sugar Land, gave Ecolab nearly $3.5 billion in fresh revenues and 12,500 employees from around the world.
In April 2013, Ecolab followed the Nalco deal by paying $2.3 billion for Houston-based Champion Technologies, a chemical firm that specializes in neutralizing, thinning and degunking the oil, gas and water processed in paper mills, refineries, fracking sites and other energy fields. Champion had its headquarters in Houston and conducted research and production in Fresno. Champion’s R & D will relocate to the new headquarters building in Sugar Land.
Combined, Nalco and Champion boosted Ecolab’s annual revenues from about $7 billion a year in 2010 to $12 billion today and gave it an instant and powerful presence in the energy services field. Previously, Ecolab was best known for providing restaurants, hotels, hospitals, dairies and factories with the chemicals and services needed to treat water, sterilize commercial kitchen equipment and to kill bacteria and pests.
Ecolab is the latest Minnesota-based company to announce a major building project, a trend that shows executives are becoming more confident about embarking on capital spending as the economy strengthens.
3M Co. is building a $150 million R & D center in Maplewood. The California-based photo sharing firm Shutterfly Inc. broke ground in September on a $60 million Midwestern hub in Shakopee. Minnetonka-based Datacard Group announced this summer that it is investing $30 million to buy and renovate a former ADC Telecommunications/TE Connectivity building in Shakopee. That site will become Datacard’s new headquarters.
Toro Co. recently broke ground on a $25 million expansion in Bloomington, while Polaris Industries finished its $20 million R & D expansion in Wyoming, Minn., earlier this year. Proto Labs is in the midst of a $15 million expansion in Plymouth.