Lumber outlet survivor grows
Zeeland Lumber Holdings LLC has purchased the former North Pacific Group lumber distribution facility in Wyoming, and will move its Hamilton Truss division there, expanding its product line and adding perhaps as many as 40 new employees there over the next few years.
Zeeland Lumber Holdings, the parent company of Zeeland Lumber & Supply Co., merged with Hamilton Lumber & Truss in early 2009 to form a second division now called Hamilton Truss. Hamilton Lumber & Truss had been wholly owned by the Hamilton Farm Bureau, which now owns 25 percent of Zeeland Lumber, according to a HFB announcement in September.
Zeeland Lumber Holdings has a total of about 145 employees, counting both full and part-time, according to Dykstra.
North Pacific, which up until January 2010 was the third-largest privately held company in Oregon and had several distribution centers in Michigan, had been a supplier to Zeeland Lumber, so it was “a property we were familiar with,” said Dykstra.
“We landed on that property due to the location — a great location, being near the M6 and 131 corridor,” said Dykstra. He added the property “also has a rail siding, which is very important to us for receiving a lot of our wood by rail.”
“This puts our stake in the Grand Rapids market,” he said.
Terms of the purchase of the former North Pacific property were not disclosed.
Dykstra said the move to Wyoming will offer enough room to expand into the production of floor trusses, wall panels and building components. About 25 people working at Hamilton Truss will now be working in Wyoming, and there may be 40 or more additional workers hired in Wyoming over the next few years, he said.
Dykstra said residential construction “is the large part of our business and always has been,” although he noted that today, “residential construction is a fraction of what it was once.”
“So it’s been tough. We’re dealing with 15 to 20 percent of the housing starts that we once had,” said Dykstra, adding that the home building industry is down 80 to 85 percent compared to the peak years of 2004 and 2005.
Wood-based construction remained at about the same level over 2009 and 2010, said Dykstra, “so it has kind of stabilized a little bit. We feel we’re kind of bouncing off the bottom and that there will be some slight growth over the next few years.”
Zeeland Lumber is also in various parts of the commercial construction market, such as post-frame construction at agricultural sites. The company also serves the do-it-yourself market, although most sales are to professional builders.
Dykstra said people in the construction industry are expressing hope that there will be real growth in 2012 or 2013.
“Our thing is, there is a lot less competition in the market, as well,” said Dykstra. More than 80 lumber yards closed in Michigan since the construction industry plummeted, he said, and about 12 major distributors around the nation went under.
North Pacific Group was one of those. Based in Portland, Ore., the company had revenue of $1.2 billion in 2006. It went into receivership in January 2010.
“It’s a game of survival right now,” said Dykstra, but he was quick to add that Zeeland Lumber is “blessed with a solid financial platform to build from.”
“We’ll make it through this, although it’s sad,” he said. “It’s not a good thing for the many businesses that have had to close their doors, but it does leave us with more market share going forward.”
Dykstra, 40, has been with Zeeland Lumber for 16 years. He was named president of the company early in 2010.
Herb VandenBosch is CEO of Zeeland Lumber Holdings.