Post Falls holster maker shifts aim
Tedder sells majority of company to focus on real estate holdingsJanuary 17th, 2019
Thomas Tedder, founder of Post Falls gun holster manufacturer Tedder Industries LLC, has sold a majority share of the company to Houston-based investment concern Main Street Capital Corp., and says he now plans to focus on real estate investments through a separate company, Tedder Properties LLC.
Following Main Street Capital’s $23.9 million investment in Tedder Industries, he says he still owns 44 percent of that company.
Tedder says he will remain the board chairman at Tedder Industries, although he plans to phase out of the CEO position by March.
Tim Treto, the company’s current chief operating officer, will take over as CEO.
Treto was brought on a few years ago as a lean manufacturing consultant and engineer, Tedder says. “Now he’s running the whole company.”
Tedder claims Tedder Industries has a bright outlook and will remain the largest tenant at Tedder Business Center. The holster company has a five-year lease with options to extend the lease for 15 years in five-year increments, Tedder says.
Tedder Industries, which currently has 200 employees, bills itself as the largest and fastest-growing holster maker in the U.S., and Tedder claims that growth will accelerate in coming years.
The company currently is expanding flagship brand Alien Gear’s latest top-selling ShapeShift series of modular holster systems.
A core carry pack ShapeShift system, which allows one holster to be converted easily between four open- and concealed-carry configurations, sells for about $100 through the Alien Gear website.
The company also recently brought on Tactica, a women’s concealed-carry fashion line through which Tedder Industries expects to tap a new and growing market, Tedder says.
Tedder Industries also plans to expand into law enforcement and military markets, which are much larger than the consumer holster and accessories market.
“I expect to see 200 to 300 percent growth in the next five years,” Tedder says.
Tedder says there’s room for such growth in production in the current facility, as the company continues to automate its manufacturing systems.
“Our manufacturing footprint is getting smaller, and we’re putting out more product,” he says.
He claims a recent automation update on an assembly line “doubled throughput overnight.”
Nearly 25 percent of the Tedder Industries building currently is used for storage, which Tedder says can be moved off-site if the company should need more manufacturing space in the future.
Tedder says he won’t mind stepping back a bit from the holster company he started up in his kitchen in Arkansas in 2010.
“It will be a little less work and a little less stress,” he says, adding. “I’ll still be poking my head around engineering.”
Tedder says it wasn’t his original intention to sell the company. “I was doing estate planning and I was surprised by the valuation,” he says. “After a year or so, I decided to sell.”
Tedder says he had several offers from investors interested in the company.
“I was careful to select someone we thought is aligned with our values,” he says.
He says Main Street Capital has offered a lot of helpful business suggestions and has put him in touch with CEOs at other Main Street Capital affiliates.
“So far, (Main Street Capital) hasn’t asked us to change anything,” he says.
Main Street Capital has ownership in over 100 companies, including affiliates in the manufacturing, construction, energy, and software sectors.
Meridian Capital LLC, a Seattle-based midmarket corporate finance, mergers, and acquisition consulting company, represented Tedder Industries in the transaction.
On the real estate side, Tedder’s first priority will be to attract more tenants to the Tedder Business Center, at 4300 W. Riverbend, in Post Falls.
Tedder bought the 180,000-square-foot center, formerly the Post Falls Factory Outlets mall, in late 2015, when the property had only two tenants.
The center, about two miles east of the Idaho-Washington border, is bisected by Riverbend Avenue, and has a 110,000-square-foot multitenant structure on the north side and a 70,000-square-foot structure on the south side, at 4411 W. Riverbend, which Tedder Industries moved into in 2016 from a 30,000-square-foot facility in Hayden.
Prior to purchasing the former outlet mall site, Tedder had planned to construct a new manufacturing plant, but then found he could buy the former Outlets property and renovate it for about the same price, Tedder says.
“We did the work ourselves and saved millions,” he says.
Tedder hired Jim Moore in July to manage Tedder Properties.
Moore is the former Spokane-area manager for San Antonio, Texas-based Cotter Ranch Properties, which had six holdings totaling 325,000 square feet of space here, including the old City Hall, at 221 N. Wall, in downtown Spokane, and the Post Falls Factory Stores, at 5065 W. Riverbend, east of the Tedder Industries Building.
Cotter Ranch Properties owner, James F. Cotter, died in 2017, and the company’s properties here since have been sold off by the Cotter’s estate representative.
Moore says Tedder has invested $3.5 million in improvements in the Tedder Business Center, including installing new roofs and HVAC systems, rehabilitating the parking lots, and renovating the interior of the Tedder Industries building.
Tedder adds, “We put hundreds of thousands of dollars into sprinklers and hundreds of thousands into signage.”
Moore says Tedder Properties had scheduled to install this week new signage for the back side of the north building to be visible from Interstate 90.
The north building now is 70 percent occupied and has 18 tenants, including fermented tea maker Bare Culture Kombucha, virtual golf outlet Scarlett’s Golf Experience, and outdoor and tactical gear and training provider 3 Ops Tactical LLC.
Tedder says he’s turned down some prospective tenants. “We don’t want to go back to only retail,” he says.
He envisions future tenants will include call centers, light manufacturing, and companies that conduct online sales, he says.
Moore says remaining space can be configured for tenants needing anywhere from 2,700 square feet to over 10,000 square feet.
Monthly lease rates start at about 60 cents a square foot.
“The goal is to get those up,” Moore says. “They were really low when I started. They were basically storage rates.”
Tedder, who’s a licensed Idaho real estate broker, says he’s looking to acquire additional properties, although he’s in no hurry, as “sellers have high expectations right now.”