A hi-tech greenhouse project that two years ago proposed bringing 140 jobs to Pikeville now plans to relocate its operations to a farm near Morehead, the company’s CEO confirmed to the Herald-Leader this week.
AppHarvest announced in February 2017 that it planned to build one of the largest greenhouses in the world in Pikeville’s industrial park — an abandoned mine site on an exposed mountaintop near the city.
The company’s planned 140 jobs and $60 million investment was lauded by local and state leaders as a potential boon to Eastern Kentucky’s faltering economy.
The project, though, never came to fruition. After nearly two years of delays, the city of Pikeville rescinded AppHarvest’s option to lease part of the industrial park in November 2018.
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“That’s marketable property, and other companies are interested in that,” Phil Eslwick, Pikeville’s city manager, told EKB News.
The Morehead location — a 350-acre parcel about two miles off I-64 near the Sharkey community of Rowan County — is promising, said Jonathan Webb, AppHarvest’s founder and CEO.
“Obviously we had our setbacks in Pikeville, but it has not changed our ultimate strategy,” Webb said.
The Rowan County site would employ 285 full-time workers, more than double what was proposed for Pikeville, Webb said. The company will pay its workers a minimum of $13 an hour plus benefits, Webb said.
AppHarvest will dedicate 120 acres of the 350-acre parcel to its greenhouse campus, which would include a 60-acre glass-and-steel greenhouse.
The company has not yet acquired the property, but Webb said that process is moving forward and should be completed by the end of this financial quarter. He estimated construction to take about a year.
Webb said the company originally wanted to build on an abandoned mine site in Eastern Kentucky, but the land just wasn’t feasible to use for a structure as fragile as a greenhouse.
The company looked at dozens of sites throughout the region before settling on Morehead, he said.
“We started in Pikeville and we had that initial site there, and it turned out to be that the land was just not suitable for AppHarvest,” Webb said. “Frankly, that’s been our biggest hurdle.”
Another company that plans to build on Pikeville’s industrial park has also reported problems.
A co-founder of Enerblu, a proposed battery manufacturing plant that has said it will employ nearly 900 workers, said in August that “it’s very difficult to build on old mines.”
“Every week we have meetings with the architects. They keep finding new issues,” Xavier Guerin, Enerblu’s chief marketing officer.
One company, SilverLiner LLC, a tanker truck manufacturer, has begun construction on the industrial site.
AppHarvest’s Morehead greenhouse is expected to cost about $85 million. The company has said it will be financed at least in part by an investment group co-managed by “Hillbilly Elegy” author J.D. Vance.
The investment firm, called Rise of the Rest, declined to say how much it would invest in AppHarvest during an interview last year, but its investments typically run between $100,000 and $1 million, according to its website.
Webb said the capital needed for the Morehead project is “standing on the sideline, ready to go.”
The Morehead greenhouse, at 60 acres, would be slightly larger than the one planned for Pikeville, Webb said. AppHarvest also plans to run its Morehead operation using rainwater rather than city water.
The company will collect and store rainwater in a 10-acre retention pond on site. The pond would provide the greenhouse with about three months of water without needing to be replenished, Webb said.
“The facility will be a structural marvel that’ll really be a sight to see,” said Bob Helton, executive director of the Morehead Rowan County Economic Development Council. “It’s been exciting to work with AppHarvest and be a part of their vision to turn Eastern Kentucky into the AgTech capital of America.”
Relying on rainwater will likely cost more upfront than city water, but Webb said it will be more reliable in the long-run than the aging water infrastructure that would otherwise supply the greenhouse.
“We’re paying more upfront in order to design the facility … but it is going to give us that resiliency,” Webb said. “We get around any of the local issues that might be on the table for aging infrastructure.”
AppHarvest has also partnered with some educational institutions, including the University of Pikeville and Pike County’s Shelby Valley High School, to train students for work in hi-tech agriculture. Webb said these programs will help the company recruit new employees, but will also help the region diversify its economy if other greenhouse companies decide to locate in Central Appalachia.
“We can’t just have steel and glass going up, we have got to have talented, young individuals who want to be involved,” Webb said.
The company does not plan to hold a groundbreaking event for its Morehead site, he said.
“We’re kind of done with the events, we’re just gonna build,” Webb said.
Will Wright is a corps member with Report for America, a national service program made possible in rural Appalachia with support from the Galloway Family Foundation. Reach him at 859-270-9760, @HLWright.