Nestle USA, a subsidiary of the Swiss food giant, Nestle S.A., announced plans to shift its headquarters, currently in Glendale, to Virginia. Nestlé’s headquarters at Glendale has been in existence for over three decades when in 1990, its parent company acquired Carnation, a Los Angeles-based company dealing in dairy business.
The move to Virginia is part of Nestlé’s strategy to keep all of its stateside operations and businesses closer to each other. It said that the move will improve operational efficiency as 85% of Nestle USA’s top customers and 75% of its factories are in the eastern part of the USA.
The chief executive of Nestle USA, Paul Grimwood, said in a statement, “This location allows us to be closer to our business operations, our customers and other important stakeholders.”
The shifting of the headquarters of the makers of Hot Pockets and Butterfingers from 800 N.Brand Boulevard, Glendale to Virginia entails the transfer of about 1200 jobs to Virginia and Ohio. The transfer is expected to start now and be completed by the end of 2018.
About 750 jobs are expected to be relocated to the new location in Rosslyn, Virginia and about 300 jobs are expected to go to Solon, Ohio, as announced by the company’s spokesperson, Edie Burge.
Virginia would now be the new home for Nestle USA’s corporate operations and its drink and food business. The company expects to move out completely from Glendale by the end of 2018.
The decision of Nestle to move out of Glendale could land a heavy blow on Glendale which had been touting the presence of the food giant in its city manifestos.
The Chief Executive of Glendale Chamber of Commerce, Judee Kendall, said, “We’re very disappointed to see them go. They’ve been great corporate neighbors and an important part of the city.”
The deputy director of Glendale Chamber of Commerce, Darlene Sanchez, further added that they were aware that the company has been planning the shift for many years and they were able to gauge the closing in on the event based on recent lease contracts signed completed by Nestle.
The deputy director said that while they were sorry to see Nestle leave California, this is also a great opportunity to attract other businesses and strive to enhance diversification in Glendale’s corporate space.
Tom Lorenz, the spokesperson for the city, said in a statement that Glendale would have been happy to negotiate with Nestle but had not been approached by the company. They had heard about the move indirectly.
He said that while Nestlé’s relocation signals “the closing of one chapter,” his sentiments echoed the optimism of the deputy director with regard to scouting for new tenants for the freed up space totaling to 518,302 square feet.
The employees in the Glendale headquarters said that they have not yet decided on plans to shift. One employee said that they are waiting for individual communication from their company before weighing options.
Nestle is moving out of downtown Glendale only. The company still maintains 5,500 employees across California including multiple facilities in the southern part of the state under Nestle Waters division.