Great Western Picks up Pace With Investment in Colorado

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BY TIM BLACKWELL

Cowcatcher Magazine

The evolution of digital imaging and the toll of the Great Recession put a double whammy on northern Colorado.

As markets tumbled and film cameras moved into the shadows in 2009, Eastman Kodak’s closure of its longtime Windsor plant sent another ripple through the community, much like Great Western Sugar’s factory closing in the mid-1960s signaled the end of a lucrative sugar beet run.

And even though Kodak’s opening soon after Great Western’s closure saved the town south of Fort Collins, the next chapter proved just as heart-wrenching. The plant that employed as many as 1,600 had begun a downward spiral in 2007, the year that the X-ray division was closed and half the workforce let go. Two years later, only 400 workers remained to shut down operations.

Kodak’s and Great Western’s departure left voids for the Great Western Railway, which had established deep roots in the region with hauling sugar beets at the beginning of the 20th century. But what seemed like bad exposure with Kodak closing was actually a picture-perfect beginning.

The Broe Group, a real estate development company that bought the bankrupt GWR in 1986 and formed OmniTRAX, had a plan shortly after the millennium as the Denver economy spread north. The vision was a diverse industrial hub in the heart of the Denver Julesburg Basin in the Niobrara Shale served by the GWR.

Soon after the Great Western Industrial Park opened in 2003, what became the park’s anchors were signed. First was Owens-Illinois, a glass bottle processing plant − a natural fit to GWR’s Fort Collins customer, Anheuser-Busch − and then in 2007 wind-energy provider Vestas. The companies, said Denver-based OmniTRAX CEO Kevin Shuba, set the tone for the future.

In 2010-11, Kodak demolished four buildings, a combined one million square feet. At the time, Windsor plant manager Rob Gray touted this as an economic opportunity because of jobs that were needed to tear down the plant, plus one day “somebody else is going to build something different here.”

Two years later and true to his words, the wheels were in motion. The Broe Group acquired Kodak’s 320-acre campus and began repurposing the land for development and growth for the GWR. Carestream, a Kodak division and X-ray film company, remained on the campus and Kodak leased some buildings to provide a base.

The Great Western Industrial Park had plenty of land to fulfill its mission, plus a railroad connected to two Class Is to deliver goods.

Today the 3,000-acre Great Western Industrial Park with 17 tenants is a key economic driver, says Shuba, who attributes 2,500 direct and 7,500 indirect jobs to the park.

Among GWR’s customers are Vestas, Carestream, Front Range Energy, Halliburton, Hexcel, Kodak, the Colorado National Guard, Musket, Cargill and Schlumberger. Crall Products, a manufacturer of filtration products for the oil and petrochemical industries, plans to build a facility there.

With all of the growth, GWR went from 800 carloads annually in its early days with OmniTRAX to a peak recently of 40,000 carloads. “When Kodak decided to shutter that plant, it was the beginning of the significant growth for the railroad,” Shuba said.

 

BEETS ONCE WERE BIG

GWR, which celebrated its 30th anniversary in June, began as a yard and spur track for the Great Western Sugar Co. in 1901, the same year that an icon of America’s rugged West, Teddy Roosevelt, became the nation’s 26th president.

The railroad, according to Kenneth Jessen’s book, The Great Western Railway, plotted routes to sugar beet factories in Windsor, Loveland, Kelim and Longmont. The Great Western Sugar Co., which now operates as Western Sugar Cooperative, opened several plants in Colorado and established the GWR as a link from grower to processor by hauling beets, sugar and molasses.

The railroad engaged small farming communities and became a vital north-south artery, connecting to Union Pacific in Fort Collins and Denver. By 1911 the GWR had taken on additional freight operations that included coal and limestone, and it moved passengers in McKeen cars. Unpredictable weather ended passenger operations in 1926, but GWR continued as a key freight mover.

Unlike many short lines, the GWR didn’t evolve as spin-off from a larger railroad. GWR laid its tracks from Loveland east to Kelim, north to Windsor and south to Longmont. Today the GWR runs 80 miles around the clock and extends northwest from Windsor to Fort Collins and southeast to Greeley. South of Kelim, the line runs to Johnstown (where an east-west extension tracks from Welty to Milliken), Walker, Mead, Liberty and Longmont.

Shippers aren’t far from Class 1 connections. The GWR interchanges with BNSF Railway and Union Pacific at multiple locations (Fort Collins is a major connection for both). BNSF also interchanges at Loveland and Longmont, and GWR connects with UP at Greeley, Kelim and Milliken. In Greeley a rehab of the interchange is expected to improve energy-related movements.

While the Great Western Industrial Park has a big book of business, other customers are scattered along the line. Commodities moved include beer, sugar, lumber, steel, ethanol, oil products and silica in addition to renewable energy and bottles.

small fleet of GP38s and GP40s head trains. Most of the runs originate from Windsor.

The Julesburg Basin, while not as prolific a producer as the Permian Basin and Bakken Shale, enabled the GWR to reach peak carloads and impressive infrastructure during the recent oil boom. GWR worked with Halliburton to build a partially automated sand facility and loop track to quickly supply drilling locations.

Sand arrives from Wisconsin and Illinois via unit trains using run-through power and is stored in six silos with 40 million pounds of capacity. Outbound trucks move through the facility efficiently under electronic direction.

“It’s an impressive facility, almost totally automated,” said Shuba, who has been CEO for 3 1/2 years. “The driver arrives with the truck, has an electronic key card that tells him which silo to go toward to load up, and he’s in and out of there in eight to 10 minutes. That was obviously another big growth factor for us.”

Musket Corp., which has three terminals in Texas, opened its ninth crude oil facility at Great Western Industrial Park in 2012. The loading facility began operations as a manifest site with a capacity of 8,000-12,000 barrels per day and expanded to loop-track operations with greater capacity.

Cargill became GWR’s latest major player to locate in the park about a year and a half ago with a steel plant to service the Rocky Mountain region. Steel is brought into the plant to fabricate products that are shipped by GWR.

 

BUSINESS DIVERSE TODAY

The industrial park model is not foreign to OmniTRAX’s short line network of 20 railroads throughout the country. The railroad serves three other key master-planned parks, including recent acquisitions in Tulsa served by the Sand Springs Railway and GEOTRAC, located in Brownsville, TX, by the Brownsville & Rio Grande International Railway, LLC. The Savannah Gateway Industrial Hub in Savannah, GA, is being developed and will be served by a start-up OmniTRAX railroad.

“The big push has been on the industrial development side,” said Peter Touesnard, chief commercial officer. “And that’s a strength of OmniTRAX. Strong real estate roots in the organization and ability to attract business to the park with that capability has been part of our success story that we’ve tried to take elsewhere.”

The Broe Group isn’t finished in Colorado. In August the company signed an agreement with the commercial real estate service firm Newmark Grubb Knight Frank to attract more businesses to the Great Western Industrial Park.

Tony Manos, senior VP industrial development, said the agreement, along with cross-selling abilities at the other industrial parks and working closely with Colorado’s economic development office, is positioning GWR to capitalize on growth north of Denver without depending on energy volatility. Already, GWR is a finalist for a state deal that could mean 400 jobs to the region and 2,500 carloads.

Company leaders say 2017 is shaping up to be an improved year, good enough to hold OmniTRAX’s year-over-year growth rate of 5-6 percent. The Rocky Mountain state should continue to be a player in that growth.

“We’re starting to see people focused on northern Colorado,” Manos said. “The good news is that it’s diverse (business), not energy.”

 

INSET

OmniTRAX will celebrate the Great Western Railway’s 30th anniversary with events in November and December. A VIP reception is set for Nov. 17, and a sponsorship event at the Colorado Model Railroad Museum in Greeley will be Nov. 19.

Festivities will conclude Dec. 3 with the arrival of Santa on OmniTRAX’s vintage “Yellowstone” passenger car No. 1 at the Windsor Wonderland Festival in Windsor.

Pullman built the “Yellowstone” in 1898 for James J. Hill, a pioneer in the development of U.S. railroads and a president of the Northern Pacific Railroad. Teddy Roosevelt used the car on whistle-stop tours during his election campaign.

The Great Western Railway Co. and its employees restored the car in 1989 and 2014 to its original specifications with mahogany interior and carpeted floors.