Beginning in the early months of 2019, parts of Fort Worth Texas will be welcoming a longtime California company as it settles into a new home. Located just outside of northwest Dallas, convenience store supplier Core-Mark will set up new corporate headquarters in the rising community of Westlake.
Created in 1888, the Fortune-500 company Core-Mark announced this week that it will begin leasing new space to fulfill the needs of its warehouses and workers. The company already has about 100 employees operating in the new region and now plans to bring more than 8,400 jobs to Dallas-Fort Worth over the course of next year.
The second-largest distributor to the convenience store industry, Core-Mark has been based out of San Francisco for nearly its entire history. According to dmagazine, Core-Mark President and CEO Scott McPherson, who already lives in the Dallas area, “cited lower operating costs and taxes as the main reason for the relocation of the Fortune 500 company’s operations.” He also said, “It’s getting us in a much better position as a nationwide company to service our customers to be in a market that is, I’d say, employee friendly with a really high quality of life.” Not only will this move serve the company economically, but it will put the company closer to some of its biggest customers, including 7-Eleven, Circle K and Murphy Oil.
While this news will certainly be a disappointment to the California economy, Core-Mark is not the only corporate vehicle leaving California for Texas. “In 2016, Farmers Bros. Co., a 103-year-old coffee company, left California for a new half-million-square-foot office and distribution center on Interstate-35W near the Texas Motor Speedway in nearby Northlake. Other recent California transplants to North Texas include Jacobs Engineering and business aviation firm JetSuite, both in Dallas” (Via dallasnews).
The passing of proposition 30 in 2012, which triggered $6 billion in new annual taxes, pushed even more companies to abandoning the Golden State for opportunities in Arizona, Nevada and Texas. Furthermore, “Last year marks the first anniversary of the announcement that Carl’s Jr., a California burger icon for more than six decades, was relocating its headquarters to Nashville. It’s a symbol for what’s become a stream of businesses that have quit California. What was once an almost quiet exodus of companies now looks more like a stampede” (Via chiefexecutive).
Texas’s pro-business climate and a large supply of relatively cheap land have surely contributed to some companies fleeing California’s taxes and regulations and it will be interesting to see if more business follow in these footsteps. And if so, will this prompt the California legislature to take a comprehensive look at its tax plan? As of now, it looks as if the high tax rate and threat of regulation is too much for heaps of business as they exit the Golden State.