Global dairy processor Saputo Inc. plans to build a $60 million cheese production, packaging and distribution facility with around 600 jobs in a new Franklin business park.
And those plans are proceeding during a period in which the Canadian company is reporting labor shortages at operations in rural areas — in part because of lower COVID-19 vaccination rates.
The production facility is to be developed on a 34.5-acre parcel south of West Oakwood Road and west of South 27th Street.
That's where Chicago-based HSA Commercial Real Estate Inc. has been planning to develop a light industrial/office building with around 340,000 square feet.
The Franklin Common Council, at its Oct. 19 meeting, approved HSA Commercial's application to create three lots on 73.3 acres near Oakwood Road and South 27th Street, including the proposed 34.5-acre Saputo site.
A city report said that parcel's development is expected to be a mixed industrial and office building.
An HSA Commercial spokesman didn't immediately respond to a request for more information about the building.
BizTimes Milwaukee reported that Saputo is planning a cheese production facility at the site — which the company confirmed in a brief statement.
The Franklin facility is to be part of the Montreal-based company's Saputo Dairy USA operations.
"The new facility will play an integral part of Saputo’s strategy to optimize its cheese network across North America, laying the groundwork for future growth," according to the statement.
"When it is fully operational, we anticipate we will have approximately 600 employees working at this facility," a company representative told the Journal Sentinel.
Along with the office workers, the building's employees will be slicing, grating and packaging cheese made at other Saputo facilities before it's distributed to retailers and other wholesale customers.
Pending city approvals, Saputo plans to begin construction in late 2021 or early 2022.
"Our target is to have the new plant begin operations in early 2023," the Saputo representative said.
"However, we anticipate that this date may be adjusted based on contributing factors such as weather, construction and supply chain issues.".
Saputo Dairy USA's operations include making mozzarella, ricotta, provolone, blue, parmesan, goat cheese and romano. Its brands include Saputo, Frigo and Stella.
Saputo is one of the world's 10 largest dairy processors, producing cheese, milk and other products. It is among the three largest cheese producers in the United States,
The company on Thursday reported earning $151 million on revenue of $7.2 billion during the first half of fiscal 2022.
Saputo's operations include several production facilities throughout Wisconsin, as well as an office in Wauwatosa.
The planned Franklin facility comes as Saputo faces challenges in finding workers at U.S. locations — especially in rural areas.
In response, the company has raised wages, provided bonus referrals and increased advertising, according to the latest earnings statement.
"These efforts have yet to yield any tangible benefits as we continue to run certain facilities well below optimal staffing levels in the USA," the statement
"Labour challenges are compounded by the fact that many of the rural areas where we operate have lower vaccination rates as compared to the general population, which can lead to higher infection rates in the community and therefore higher absenteeism," it said.
The statement said the situation will improve if the Biden administration's vaccine mandate for businesses with 100 or more workers takes effect. A federal appeals court on Saturday temporarily halted that mandate pending lawsuits seeking to overturn it.
Saputo also is increasing automation in certain facilities, reducing the number of products and focusing on "facilities where we see a more stable and sustained talent pool for the long-term," according to the earnings statement.
"Amidst a growth in secondary packaging requirements and labor shortages in the industry, the Franklin site provides a number of benefits," Saputo told the Journal Sentinel.
Those include an available talent pool, space and conditions needed for the new building, and proximity to suppliers.
Saputo's Wisconsin operations include facilities in Green Bay, Waupun, Mayville, Reedsburg, Monroe, Lancaster, Belmont, Almena, Lena and Black Creek.
The Franklin production facility would be part of a larger business park.
The Common Council in 2016 rezoned 504 acres south of Oakwood Road and west of 27th Street to allow for the business park's development.
The city also has a tax incremental financing district to use property tax revenue from the new buildings to pay for roads, sewers and other public improvements.
The council at its Tuesday meeting granted preliminary approval to finance development of a new road, South Hickory Street, that would serve the future Saputo facility and other business park developments.
That includes two light industrial buildings, totaling up to 536,180 square feet, that Wangard Partners Inc. plans to develop at 3617 W. Oakwood Road, just west of the planned Saputo facility.
The business park is tied to the new nearby Elm Road/I-94 interchange, with the city also planning to make improvements to Elm Road.