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Commercial truck dealer Diamond plans expansion near airport

Story originally published by theĀ Commercial Appeal

A Memphis-based chain of commercial truck dealerships is seizing a prime opportunity for growth amid tough economic times.

Diamond Companies owner Richard Sweebe is doubling the acreage of his Diamond International truck dealership in the airport area and giving it a brand-new look.

The holding company has bought the former Chuck Hutton Toyota and set about making it the centerpiece of a 10-acre campus devoted to the sales and service of big rigs.

Sweebe is investing more than $4 million to renovate the dealership and Diamond's 37-year-old location, formerly Mid-America International, next door at 1750 E. Brooks. The privately owned company bought the former Hutton property for $1.8 million March 1 after a new Hutton Toyota opened at Interstate 55 and Shelby Drive.

Sweebe was determined not to let the economic downturn stop him from pursuing more space for a landlocked dealership he has owned since 1982.

"First of all, nothing's forever," Sweebe said. "When the business comes back, we want to be able to take advantage of it."

Diamond hired Renaissance Group architects and Grinder, Taber & Grinder general contractors to plan and execute conversion of aging commercial buildings into a unified campus.

It is one of several upgrades under way in an area targeted for improvements by the Memphis Airport Area Development Corp. Across Brooks east of Millbranch, a Peterbilt truck dealership has an expansion plan that includes tearing down a shuttered strip club. The Memphis Area Teachers Credit Union is renovating a branch across Millbranch from the old Hutton site.

The recession cuts both ways for Diamond Companies. While truck sales are at a low, Sweebe said maintenance and repairs, his bread and butter, stayed strong as owners squeeze more miles out of older trucks.

"Diamond International obviously knows once this economic trend is behind us, there will be a huge increase in truck sales," said Sandeep Kar, an automotive and transportation industry analyst with Frost & Sullivan. "There's a pent-up, ballooning demand that's increasing every day. From now until then, it's the service and maintenance they will provide in the Memphis area."

Sweebe said the timing is also advantageous because of low interest rates from his financing source, First Tennessee Bank, and stable costs for construction materials and equipment.

Because of a concerted push to incorporate energy-saving features into the renovations, the project should yield lower operating costs over the life of the buildings.

Sal Feraci, principal with Renaissance Group, and Ronald E. Colin Jr., project architect, are aiming to include Energy Star-certified features that qualify for federal tax credits. Feraci said as they essentially create new buildings inside the existing shells, architects will seek to achieve efficiencies through insulation, mechanical systems and lighting.

Sweebe said, "We want to do what's as environmentally friendly as possible, as long as it's within reason."

While the architects plan, the contractor is getting a head start with demolition and cleanup on the Hutton property, Grinder, Taber & Grinder vice president Brett Grinder said.

The contractor and architect collaborated on the new Toyota dealership and other commercial projects around the city, Grinder added.

Site plans call for the old Hutton showroom to become a sales center for new and used trucks. Hutton's 20 service bays will be used for preventive maintenance with quick turnaround. Diamond's existing 23 bays will be devoted to heavier repairs that take more than a day.

The goal is to complete renovations by the end of the year.

An Ohio native, Sweebe began working for International Harvester in 1972, when the manufacturer still owned its dealerships. He bought the Memphis dealership in 1982 and has expanded it to 17 locations in Memphis, Arkansas, Missouri and Kansas. About 125-130 of his 600 employees are split among locations on Brooks and a body shop at 700 S. Third.

The dealerships were rebranded under the Diamond name in 2008.

Brooks and Millbranch is ground zero for heavy truck sales and service in Memphis.

"Driving around the neighborhood, this is where we want to be," said Scott Gill, Diamond CFO. "All the truck dealers are right around here."

A Kenworth dealer is north of the campus, and Cummins Mid-South Inc., truck engine dealer, is on the east.

"We want to be in Whitehaven," Gill said. "This is part of our commitment to Whitehaven; this block doesn't need to be vacant."

-- Wayne Risher: 529-2874

Diamond Companies

What: Commercial truck sales and service with 17 locations and more than 600 employees in Tennessee, Arkansas, Missouri and Kansas

President and CEO: Richard Sweebe

Annual sales: Average $250 million to $300 million

Operations: Diamond International truck dealerships, six Diamond Idealease truck leasing locations, Diamond State Bus Company in Conway, Ark.