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Spotlight/garcia/28/dp1st/mike2nd Tejon Ranch Year Founded: 1853 Origins: Rancho El Tejon was granted to a local family by the Mexican government in 1843. Ten years later, it was transformed into a cooperative farming effort by U.S. Naval Officer Edward Fitzgerald Beale as a way to appease Native Americans protesting over farming rights. The following year, Fort Tejon was opened and European settlers came to the area. Business Profile: An agricultural mountain community By SHELLY GARCIA Staff Reporter It’s been more than a century since the Tejon Pass was widely regarded as the gateway to Los Angeles. Now the management of Tejon Ranch Co. is hoping to rebuild that bridge for the next century. The firm plans to transform the rural enclave into a major commercial hub to capitalize on its location and provide an alternative to the increasingly scarce and expensive land to the south in Los Angeles. To accommodate the project, the company is setting aside a portion of its 270,000 acres for industrial development. This month, as part of a joint venture with Petro Stopping Centers, Tejon Ranch Co. will open a 51-acre facility catering to truckers and other travelers along Interstate 5 at the Wheeler Ridge Road off-ramp, three miles north of the Grapevine exit in Kern County. In September, the company plans to unveil details of its proposed project, Tejon Industrial Complex, a 4,000-acre master-planned industrial park adjacent to the Petro travelers’ facility. In addition, feasibility studies are underway to determine the viability and best types of projects to develop on other parts of the land. “This is the largest contiguous land holding in California, and it has remained untouched since the mid-1800s,” said Barry Hibbard, director of real estate marketing for Tejon Ranch Co. “That has a huge value. How do you unlock it? We want to do that by creating investment opportunities (for developers and future joint-venture partners).” Tejon Ranch Co. expects to continue to devote a large portion of its land to farming. But company officials said the focus on real estate activities, which began with the divestiture of some portions of its property several years ago, has already started paying off. The area has a diverse history. By the mid-1800s, the vast tract of farm and grazing land known as “The Tejon” had become a bustling commercial community and a social laboratory of sorts. Native Americans farmed barley, wheat and corn while European merchants and shippers settled near Fort Tejon, a U.S. Army outpost, to take advantage of the area’s strategic location connecting northern and southern portions of the state. But when a Native American cooperative was disbanded and the outpost moved south, the land was consolidated first in the hands of U.S. Naval officer Edward Fitzgerald Beale and later under a syndicate headed by Los Angeles Times Publisher Harry Chandler and Moses H. Sherman (for whom Sherman Oaks is named). Since then, the Tejon Ranch Co., which has been publicly traded since 1912, has remained a working ranch that today has some 29,000 head of cattle. But three years ago, following Times Mirror Co.’s divestiture of its 31 percent equity stake and a resulting changeover in management, Tejon Ranch Co. began to diversify, focusing on the development of its vast real estate holdings. (The company’s shares today trade on the American Stock Exchange under the symbol TRC.) Officials at the company believe that as land becomes ever more scarce and expensive in Los Angeles, Riverside and San Bernardino counties, Tejon Ranch will become an increasingly important industrial hub for Southern California. Along the western border of the ranch near Interstate 5, Tejon Ranch Co. has set aside 350 acres for the first phase of its efforts, a 3.5 million-square-foot industrial center slated to break ground within the next 12 months. The company has secured about half the permits it needs to build warehouse and distribution facilities there, ranging from 350,000 to 1 million square feet. Final approvals are expected by mid-August, and if the current favorable economic conditions hold up, Tejon Ranch expects to complete its first phase of development within the next five years. “One of the biggest things we see is our proximity to the mid-population point of the state,” Hibbard said. “There are 300,000 people within 10 to 15 minutes from us in Bakersfield. Forty minutes to the south is Valencia. So we really have an abundant amount of labor, both skilled and non-skilled.” In addition to availability of labor, another factor that makes Tejon Ranch ripe for development is the push to consolidate distribution and warehousing facilities in larger, single locations, Hibbard said. With the increased popularity of electronic commerce, companies require ever-larger facilities that can handle large volumes of inventory. Company officials say the central location of Tejon Ranch, along with the relatively inexpensive land values and access to a large labor force, give the area a competitive advantage over the Inland Empire and Valencia for these types of centers. “We’re ideally suited to serve Northern and Southern California from one location,” Hibbard said. “Instead of having two (centers), you can do it all from one area.” The older distribution facilities in Los Angeles County lack the state-of-the-art technology that modern warehousing utilizes, and newer buildings in Valencia or the Inland Empire are far more expensive, Hibbard said. “Our prices are in the range of $2 a square foot. So we see ourselves being the low-cost producer of a real quality product on the interstate,” he said. Petro Travel Plaza, which is scheduled to open this week, will serve as the anchor for the Tejon Industrial Complex, providing services to truckers and traveling tourists. The $20 million center will have parking facilities for 415 trucks, including such amenities as computer and telephone hookups in the parking stalls. The system will allow truck drivers to plug in their laptops or telephones and call or e-mail their families and home offices. The facility will also include an Iron Skillet restaurant that will seat up to 300 customers, and Mercantile Co., a 7,500 square-foot convenience store that also carries apparel, electronics and truck and auto parts and accessories. There will be 20 private showers, a no-charge movie theater playing current video releases 24 hours a day, a game room with 15 to 20 different video games, a lounge with television, copier and fax services, and an Internet kiosk. “The location offers significant growth (potential) as far as the amount of truck traffic,” said David McClure, director of marketing for Petro Stopping Centers, an El Paso, Texas-based company that operates 50 travel plazas in 29 states. “It’s a major stopping place for trucks headed into the L.A. market. Also, the amount of growth that Tejon Ranch will bring to that area over the next 10 years made it a very attractive location.” Petro, which will employ about 200 workers at its new facility, is a welcome addition to Kern County, where unemployment has been running at 13.2 percent, about twice the state average, according to the most recent figures. Surrounding communities such as Arvin, which is 21 miles away, and Lamont, 12 miles away, have unemployment rates of 24.3 percent and 23 percent, respectively. “I think it’s an excellent opportunity,” said Jay Doughty, deputy director for employer services at Employers Training Resource, a county agency established to assist with welfare-to-work efforts. “It will give welfare recipients access to jobs without having to go to Bakersfield to get them.”