Bobo’s Oat Bars seeks incentives to consolidate manufacturing in Northern Colorado

LOVELAND — The Loveland City Council will consider an incentive agreement Tuesday night that could result in a consolidation of manufacturing operations for Simply Delicious Inc., which does business as Bobo’s Oat Bars.

The Boulder-based company, which has manufacturing facilities in Boulder and Loveland as well as a warehouse in Loveland, proposes to consolidate all manufacturing and warehousing in Loveland or Johnstown. It would expand its manufacturing operations from 55,000 total square feet now to 120,000 square feet in a new facility.

Bobo’s, according to information provided to the City Council, has its sights set on either the Axis 25 facility built by Etkin Johnson Real Estate Partners LLC adjacent to Interstate 25 and across from the Embassy Suites hotel, or Centerra Industrial Building 6, both new facilities. Beckman Coulter Life Sciences this month said it would move into one of the two Etkin Johnson buildings in Axis 25, leaving about 100,000 square feet of space.

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While the materials provided to the council identify Centerra Industrial Building 6, part of a complex of seven industrial buildings each about 123,000 square feet, as Bobo’s target, that may not be available. McWhinney, owner of the complex, said in October 2020 that it had leased 25,757 square feet of Building 6 to Geary Pacific Supply, an HVAC supplier, and an unnamed national home improvement company was looking at Building 6 as well. Building 7, however, is under construction and may be available as soon as this fall.

The Johnstown location was not identified, however, it is known that United Properties is building a three-building complex called Trade @ 2534 in Johnstown that will sit on 16 acres and include 280,000 square feet of space, including a cross dock facility with loading docks on east and west sides.

Bobo’s current facility in Loveland is at 1510 E. 11th St., which the company established when it ran out of room in Boulder to manufacture the increasingly popular oat bars. 

Bobo’s revenue, as disclosed to the council, has been on a growth trajectory with $33.5 million in revenue in 2020, $44.2 million projected for 2021, $55 million for 2022 and $67 million for 2023.

To meet those growth projections, the company needs more space. It would close its Boulder facility and move 40-60 employees from Boulder to Loveland in the first year to establish an employee count of 140-160 workers, it said. Its headcount would grow to 165-185 in year two and as many as 190-210 in year three, according to projections.

The council will consider a proposal to provide sales tax incentives to the company over a five-year period. In its first year of operations in Loveland, the company said it would buy about $10 million in equipment. That equipment would normally be subject to sales tax. Instead of collecting tax on the entire amount, the city would defer about $150,000 in sales taxes and waive those deferred taxes completely if the company continues to operate in the city through October 2027. If the company were to cease operations before that, a graduated scale of deferments would occur.

To secure the deferments, Bobo’s would need to sign a seven- to 10-year lease — a seven year lease would be valued at about $13.5 million, city economic development officials said — by Oct. 1, 2021, and obtain all necessary city permits by Oct. 1, 2022. 

The city’s economic development office said that the benefit to the city would be the additional employees who would earn an average of $45,000 a year, sales taxes on the equipment that are not deferred, and sales taxes on purchases that up to 125 new employees would make in the city. 

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