By Roland Murphy for AZBEX
[UPDATE: We received a response from the City of Buckeye after this issue of AZBEX had already gone out to our subscribers. In the interests of thoroughness and timeliness, we are including the relevant section of Deputy Director of Communications John O’Halloran’s response here: “We greatly value our strong working relationships with both the media and the businesses considering Buckeye as their home. At this time, we have not received direct communication from KORE Power regarding their business decisions in Buckeye. Until we do, we are unable to provide an update on their plans.”]
Wednesday afternoon (Jan. 29) an alert reader emailed BEX Founder and President Rebekah Morris and said he had noticed a LoopNet listing for the 214-acre KOREPlex site in Buckeye.
Armed with the link and a little more information from this source, BEX Research and Editorial staff dove into all the available material to find out what was happening.
Based on everything we found, we feel safe in saying it appears KORE Power’s KOREPlex project has died a quiet death. Until we know more, however, we are listing it as On Hold in the DATABEX project database.
Quick Reminder: What is/was KOREPlex
In a May 2021 press release, KORE Power announced it was considering three locations—one in Arizona, one in Florida and one in Texas—as the site for what it intended to be “the first lithium-ion battery manufacturing facility owned by a U.S. company.”
By July, the company had made its decision and announced the facility would be built in Buckeye. The press release said, in part, “The one million square foot manufacturing facility, dubbed the KOREPlex, will support up to 12 gigawatt hours of battery cell production to ensure a reliable and independent U.S. supply chain for lithium-ion battery cells that are critical to the future of electric vehicles, power grids and more. The facility will have the capacity to produce enough power for 3.2 million homes each year. KORE plans to start construction of the facility by the end of the year with the goal of beginning production in Q2 2023.”
In early 2022, KORE Power paid real estate and development company Mangat Group nearly $28.9M, with a $15M down payment, for the 214-acre site at the SEC of Baseline Road and State Route 85.
In a press release dated May 26, 2022 the City of Buckeye gave details of KORE Power’s plans and highlighted three meetings the company had held to present the project to local residents and business groups. The release featured five key points from the discussions, saying: At the meetings, (Co-Founder and CEO of KORE Power) Lindsay Gorrill gave a presentation which included new details including:
- The KOREPlex facility has grown from one million square feet to two million square feet
- The costs of the project has grown to $1.25 billion from $1 billion
- The project will break ground this year (2022)
- Operations will begin in 2024 with hiring likely ramping up in 3Q 2023
- KORE Power is committed to supporting the KOREPlex with a US-based supply chain.
The last detailed project description in DATABEX reads, “The first phase of the project will consist of a 908,880 square foot manufacturing hall, a 27,930 square foot administration building, fourteen ancillary storage and support buildings ranging in size from 5,627 to 23,043 square feet, and an electrical substation and switchyard. A second phase of the project will include an additional 907,918 square foot manufacturing hall and further ancillary support buildings. Upon completion of all phases, the project is expected to exceed 2 million square feet of total building area.”
For several months, KOREPlex became the TSMC of the southern West Valley. The planned facility was expected to play a major role in the country’s rapid push toward electric vehicle use. Not surprisingly, it became a significant catalyst in Buckeye’s explosive growth, serving as a major bullet point in the City’s economic development marketing and spurring additional interest and demand.
One project—Rooks Technology Park by Crimson Canyon Development—was “intended to be part of the industrial ecosystem forming around the nearby KOREPlex battery plant,” according to an aggregated article in the August 8, 2023 issue of AZBEX.
That three-phase, 1.7MSF project was given a rezoning request approval by Buckeye City Council that month and has since remained inactive. It also is currently listed in DATABEX as On Hold.
Even at the time of the May 2022 announcement, the stated KOREPlex timeline seemed aggressively ambitious. That, however, is common with highly visible large scale projects, and KOREPlex initially progressed through the review and approval process fairly readily.
According to status notes in DATABEX, at-risk grading permits were issued in December 2022. A site check in January 2023 confirmed site work had begun. BEX Research staff confirmed site work was still ongoing as of February 2024. At the end of that month, the Buckeye Planning and Zoning Commission approved the project’s site plan review.
A building permit was filed in April 2024. No vertical work started, however, and the last grading permit inspection was in August.
And that’s where the project-specific information stops. KORE Power’s own information about the project and its progress stopped even earlier. The company’s last press release focusing specifically on its Arizona plans was issued on March 1, 2023 and announced it was partnering with multinational tech conglomerate Siemens. Siemens Smart Infrastructure was to be used for electrical infrastructure and process management in the plant.
Siemens was also to invest capital in the project. According to the release, “Announced late last year, Siemens Financial Services was the lead investor on the initial $75 million tranche of private financing for KORE’s new facility, which is projected to be complete by late 2024 to early 2025. Strengthening this partnership further, Jason Thompson, Vice President of Private and Growth Equity from Siemens Financial Services has joined KORE Power’s Board of Directors.” The announcement also contained a link to Siemens website featuring the company’s “end-to-end battery manufacturing capabilities.”
What Happened?
Any speculation as to why the KOREPlex site ended up marketed for sale with no official word from the company or the City of Buckeye would be only that: speculation. There are, however, a number of factors that could have played a part.
After a period of exceptional hype and growth, the EV market has normalized in the market’s mind. Most car companies now have an EV component in their product matrix, and sales have continued to rise, reaching 1.3 million units in 2024. However, ongoing real and perceived issues—including higher per-unit costs, relatively short operating ranges compared to combustion engines, fire and safety concerns around lithium-ion batteries, the ending of some subsidy and incentive programs, and the lack of supporting infrastructure like conveniently available charging stations—have significantly reduced the fanfare around the product type.
The Inflation Reduction Act passed by the Biden administration in its flurry of infrastructure and alternative energy development spending legislation focused a great deal of attention on EVs among its targeted industries. In June 2023, KORE Power announced it “received a conditional commitment from the U.S. Department of Energy’s Loan Programs Office for a loan in the principal amount of $850 million under the Advanced Technology Vehicles Manufacturing Loan Program.”
The announcement was trumpeted by Arizona U.S. senators Mark Kelly and Kyrsten Sinema, with Kelly saying, “The administration is taking advantage of the resources we provided through the Inflation Reduction Act to not just boost jobs in Arizona, but also to strengthen our national security by reducing our dependence on foreign sources of battery components for everything from electric vehicles to energy storage. Thanks to KORE Power and the rest of our emerging battery sector, Arizona will be front and center leading the country in developing and manufacturing the technology that will power our economy into the future.”
It is worth noting in this announcement, the square footage mentioned had decreased to 1.33MSF.
We reached out to KORE Power and City of Buckeye officials late Wednesday afternoon asking for confirmation and clarification on the project status and future plans. We left a voicemail for KORE Power Chief Marketing Officer Aleysha Newton and sent an email to Buckeye City Manager Dan Cotterman and Economic Development Director Suzie Boyles.
Knowing it was short notice, we held back on finalizing this article and putting it into production as long as we could. As of our publication deadline, we received no response.
The Current State
The property is listed with JLL, which has assigned a top team of commercial real estate leaders to manage the transaction. JLL’s brokerage team, according to the web page, is comprised of executive managing directors Anthony Lydon and Marc Hertzberg and executive VPs Chuck Rosien and John Lydon.
BEX Research staff reached out to JLL by email to confirm the property is the KOREPlex site. Anthony Lydon replied late Thursday morning and said, “Kore Power has put a hold on developing subject site…. Accordingly, we are promoting the 214-acre site for sale.”
JLL’s brochure refers to the site as the B85 Technology Park and highlights the property’s features, including its industrial zoning and proximity to transportation infrastructure, such as Interstate 10, Union Pacific Railroad and 40-minute drive time to Phoenix Sky Harbor International Airport.
It also references the City of Buckeye’s planned construction of Rooks Road Bridge across the Buckeye Canal next to the property, giving an estimated completion of sometime this year. The $11M project is currently listed in DATABEX as being in the design phase.
The brochure and web page do not list an asking price for the 214-acre property, instead directing prospective buyers to contact the brokerage team for pricing information and due diligence documents.
The summary says, “Boasting robust existing infrastructure on-site, this site is a prime opportunity for a high-tech manufacturer to develop a state-of-the-art facility in this sought-after region.”
As of this moment, we have no way to predict when or if that prime opportunity will be met.