Advantage Capital Partners Invests $9.75 Million in Mid America Brick
Advantage Capital Partners has provided $9.75 million of a $21.9 million total project financing for the effort to reopen a brick manufacturing plant in Mexico, Mo. Mid America Brick & Structural Clay Products, L.L.C. will use the funding from Advantage Capital, Rand Capital, Environmental Liability Transfer and other investors to acquire, re-commission, and operate the former A.P. Green plant as a face brick manufacturing facility. The plant will provide approximately 80 new jobs when fully operational in 2011.
“This is great news for the rural community of Mexico, Mo.,” said Scott Zajac, senior managing director at Advantage Capital. “Our firm is proud to be part of an effort to spur job creation and economic development right at the time when confidence among homebuilders is on the rise.” Advantage Capital will utilize both federal and Missouri New Markets tax credits, designed to stimulate private capital for economic growth in low-income communities, to help finance the project.
The A.P. Green plant, which closed in 2002, was once one of the largest refractory brick manufacturers in the U.S. Mid America Brick will use the facility to make face brick for residential and commercial/industrial construction. The process for manufacturing refractory brick and face brick is similar; therefore, the re-commissioning and conversion costs of the A.P. Green plant will be minimized.
The Commerce Department reported last month that new housing starts rose nearly 6% in April, a much faster pace than expected. The data was released following a report from the National Association of Homebuilders that said builders’ confidence in starting new projects is at its best level in two years, due to an increase in home purchases in the first quarter.
“There has been a tremendous amount of dedication to see this project through,” said brick industry veteran and Mid America Brick CEO Frank Cordie. “I am extremely pleased that we will be able to begin the work that will lead to redeveloping the area, re-opening this plant and providing jobs in our community.” He acknowledged the strong support at the local, state and federal levels of government, including the Mexico City Council and state senators and representatives.
Mid America Brick’s central location is expected to give the manufacturer a competitive advantage, due to the expected lower transportation costs associated with shipping bricks to various locations throughout the Midwest. In addition, all indicators are pointing to more demand for face brick due to the extremely low inventories of brick as a result of a slowdown in the building industry. When the plant is fully operational, it is expected to produce nearly 60 million bricks annually.
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