Hundred million dollar deal keeps FreshDirect in city
New York City has won the war to keep the online grocer FreshDirect in the city by agreeing to deliver $100 million in grants and tax incentives to the company so it can move it to Port Morris.
Governor Andrew M. Cuomo, Mayor Michael R. Bloomberg, and Bronx Borough President Ruben Diaz Jr. announced the agreement on Feb. 7.
In return, the company has promised to add 1,000 new jobs over the next eight years to its staff of 2,000 and to purchase 10 all-electric refrigerated trucks that emit no pollutants, helped by $1 million in state funds.
In November, the manufacturer of the trucks, Smith Electric Vehicles, said it would renovate a warehouse into a plant of its own, bringing another hundred jobs to Port Morris.
Founded in 1999, FreshDirect has outgrown its Long Island City facility. Its search for a new home sparked a bidding war with New Jersey.
The winnining incentive package includes $14 million in grants, a million-dollar loan and $18.9 million in tax credits from the state; $74 million in tax breaks from the city, along with a $9.5 million grant, a million-dollar loan and $4.9 million in energy benefits; $1 million from the Bronx Borough President, and $500,000 from the Bronx Overall Economic Development Corp., which also provided a $3 million loan.
The new FreshDirect headquarters will be a 16-acre parcel in the Harlem River Rail Yard, city-owned land leased to the Galesi Group. The rail yard also houses the New York Post printing plant and the “garbage train,” on which since 2007 Waste Management has transported more than 2,000 tons of garbage a day out of the city, rankling Mott Haven residents with its noise and smell.
FreshDirect will spend more than $112 million to build its new facility and stock it with equipment, according to its application for tax exemptions. It says it will begin operating from the new headquarters in 2015.
FreshDirect takes orders for groceries on-line and delivers to the door of customers’ homes and offices. The only Bronx neighborhood it serves is Riverdale.
That prompted Ed Garcia Conde to complain on his Welcome2Melrose blog that “The rest of the Bronx might as well not exist and if they’re going to plant roots in the South Bronx, they better be compelled to make deliveries in that very neighborhood as well as ALL neighborhoods of our borough.”
The governor’s press release accompanying the announcement that FreshDirect would move to the Bronx says, “The company will dramatically expand its service area to regions surrounding New York City, as well as New Jersey, Connecticut, and Philadelphia.”
But for the governor, the mayor and the borough president, the key issue is jobs. “Creating almost a thousand new jobs is a real victory for the Bronx,” said Cuomo.