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As a Food Industry Location AN ANALYSIS OF NORTHEASTERN PENNSYLVANIA AS A FOOD INDUSTRY LOCATION FOOD WHITE PAPER 01 INTRODUCTION 04 LOCATION & TRANSPORTATION 07 REAL ESTATE 13 WORKFORCE 19 EDUCATION & TRAINING 21 INCENTIVE PROGRAMS CONTENTS INTRODUCTION Northeastern Pennsylvania (NEPA), consisting of Northern I-81 Corridor communities such as Scranton, Pittston, Wil- kes-Barre, and Hazleton, has long been a magnet for food and beverage manufacturing and distribution operations. Several factors have combined to grow the food industry in NEPA. These include quick access to raw materials and the Northeast’s consumption zones, an available, quality, and affordable labor supply, abundant and reliable utili- ties, and a wide variety of available ReadyToGo!TM Sites and Buildings with room for expansion. Food and beverage companies with manufacturing plants in the region include Archer Daniels Midland, Ateeco (Mrs. T’s Pierogies), Bakkavor, Bimbo Bakeries, BC Bundt, Cargill Meat Solutions, Citterio USA, DelMonte Pet Products, D.G. Yuengling & Son, General Mills, Gertrude Hawk Chocolates, Gonnella Frozen Products, Hershey Chocolate USA, J&J Snack Foods, Keystone Coca Cola Bottling Company, Kraft Foods, Lion Brewery, Maid-Rite Specialty Foods, Michael Foods Egg Products, Mission Foods, Nardone Brothers Bak- ing, National Bakery, Nature’s Way Purewater, Otis Spunk- meyer, Preferred Meals, Quaker Oats (Gatorade), Stroeh- man Bakeries, and Wise Foods. Companies with food or beverage distribution operations in NEPA include Americold, Bell-Carter Foods, Bimbo Bak- eries, Core-Mark, Gress Refrigerated Services & Logistics, Henningsen Cold Storage, Hilshire Farms, Herr’s Food Prod- ucts, igourmet.com, Kane is Able, MaineSource, McLane Co., Nature’s Bounty (NBTY), PepsiCo, Pero Family Farms, Romark Logistics, Sun-Maid, Tootsie Roll Industries, U.S. Cold Storage, US Foods, Walmart, Wegmans Food Markets, and WellPet. Continue reading for more information about NEPA’s assets that food and beverage companies find appealing. 01 02 03 LOCATION & TRANSPORTATION NEPA is in the center of the Boston/Washington Corridor and More than 99 million people, about one third of the nation’s is at the confluence of six major highways. Interstates 81, 80, population, live within a 500 mile radius of NEPA, and more 84, 380, 476, and 78 meet here and provide excellent access to than 51 million people live within 200 miles. New York City, firms wishing to serve Maine to Virginia and west to Ohio. Philadelphia, Harrisburg, and Syracuse can all be reached in about two hours. Interstates 81, 80, 84, 380, and 78 are toll-free in NEPA. There are no major bridges or tunnels in the region to delay truck Dozens of truckload and less than truckload trucking firms departures or arrivals. serve the region. Some companies active here include ABF Freight, A. Duie Pyle, Bolus Freight Systems, Calex Logistics, The region’s main highway, I-81, runs from the US/Canadian Con-Way Freight, Evans Distribution Systems, Estes Express border in the North to Knoxville, Tennessee in the South. I-81 Lines, Kane is Able, Karchner Logistics, M.S. Carriers, NFI Lo- intersects several major East-West highways, which include gistics, New Penn Motor Express, Pitt Ohio Express, PRIME, I-80 (access to New York City), I-78 (access to the Lehigh Valley Inc., R.C. Moore, R & L Carriers, RLS Logistics, Ward Trucking, and New Jersey), I-84/I-90 (access to Boston), I-76 (access to and YRC National. Pittsburgh and Philadelphia), I-70/I-270 (access to Washing- ton DC), and I-83 (access to Baltimore). UPS, FedEx Ground, and FedEx Express have major facilities in NEPA. In fact, FedEx Ground and UPS have operations at the The Northern I-81 Corridor is quickly accessible to most major main entrances of CenterPoint Commerce & Trade Park East, seaports along the East Coast, which are predicted to expe- near Pittston, PA, while FedEx Express is located in an adjacent rience increased volume once infrastructure upgrades to the business park. Panama Canal are complete. Upgrades to the Canal will al- low for the passage of “post-Panamax” ships with a capacity Two Class I railroads (Norfolk Southern and Canadian Pacific) to carry 12,000 containers (three times more than a ship can and several short lines are active here. An inter-modal rail yard currently carry through the Canal). is operated in Taylor, which is located near Scranton. 04 NEPA is served by two main airports, the Wilkes-Barre/ Scranton International Airport (AVP) and the Lehigh Valley Airport (ABE). The Wilkes-Barre/Scranton International Airport (www. flyavp.com) offers approximately 40 daily arrivals and departures to seven major hubs with one-stop service to more than 450 destinations worldwide. AVP provides direct daily flights to Atlanta, Charlotte, Chicago, Detroit, Newark, Orlando, and Philadelphia. Carriers include Allegiant, Delta Connection, United Express, and US Airways Express. AVP is also served by Saker Aviation, one of the finest fixed base operators in the Northeastern United States. The Lehigh Valley International Airport (www.lvia.org) provides direct daily flights to Atlanta, Charlotte, Chicago, Newark, Detroit, the District of Columbia, Orlando, Phila- delphia, St. Petersburg, and Toronto. ACCESS TO CONSUMPTION ZONES FROM CENTER OF NEPA RADIUS POPULATION 100 MILES 17,049,097 200 MILES 51,067,989 300 MILES 65,595,311 400 MILES 83,103,487 500 MILES 99,002,235 Source: NEPA Alliance 05 06 REAL ESTATE MERICLE COMMERCIAL REAL ESTATE SERVICES In the late 1980s, Mericle Commercial Real Estate Services By constructing tight building envelopes, installing became the first private developer to construct industrial energy-efficient T-bay lighting and HVAC systems, shell buildings on speculation in NEPA. Mericle purchased improving ventilation and indoor air quality, and by land that had been developed by area chambers of com- using native and adaptive landscaping and recycled/ merce and constructed speculative buildings ranging regional materials, Mericle is making a concerted from 40,000 square feet to 100,000 square feet. Since effort to “go green.” that time, Mericle has developed more than 18 million square feet of industrial, office, and flex space in NEPA, In addition to regularly constructing buildings on including numerous bulk industrial buildings. More than speculation, Mericle also prepares sites in advance for 13,400 people work in Mericle-developed properties. new construction. Today, Mericle owns and maintains approximately 11 mil- In fact, through its ReadyToGo!™ Program, Mericle is lion square feet in NEPA. Mericle is a vertically integrat- developing more than 90 such sites in 11 NEPA busi- ed “master builder” that self-performs its development ness parks. projects. The company’s approximately 200 employees design, construct, and maintain all of its facilities. Mericle’s Design Department obtains all necessary per- mits and approvals, and its 50-employee Excavation Among its in-house team are two Leadership Energy & Division, considered to be one of the largest of its kind Environmental Design (LEED) Accredited Profes- in the US, clears, grades, and compacts the ReadyTo- sionals who obtained Silver LEED status for Mericle Go!™ Sites and makes them ready for the immediate buildings occupied by Amazon.com, Kimberly Clark, and construction of building foundations. These sites also Benco Dental. have all permits and approvals in hand, all utilities in place, and can accommodate buildings ranging from Several years ago, Mericle started a Green Building Pro- as small as 10,000 square feet to as large as 1 million gram and made a commitment to provide lower operat- square feet. ing costs to tenants through the implementation of eco-friendly, energy saving measures. 07 Mericle’s vertically integrated “one-stop-shop” struc- ture and its aggressive development of speculative industrial buildings and ReadyToGo!™ Sites are very helpful to food manufacturers and distributors oper- ating under compressed timeframes wishing to deal with a single source. Mericle has provided commercial real estate solu- tions to a variety of food and beverage manufactur- ing, distribution, and packaging companies. These include Aramark, Bakkavor (Two Chef’s on a Roll), Bimbo Bakeries, Greiner Packaging, Mission Foods, Nature’s Bounty, Nature’s Way Purewater, PepsiCo (Gatorade), Tech Packaging, and Wegmans. All of Mericle’s available buildings and sites can be reviewed at mericlereadytogo.com. Average industrial lease rates in NEPA are significant- ly lower than those in most major Northeast metro areas. A study by national business consultant Wad- ley Donovan Growth Tech compared lease rates for several areas in NEPA with rates in Middletown, New York and Hightstown, New Jersey. On average, lease rates in NEPA are 79% of those in Middletown and just 69% of those in Hightstown. Likewise, in several Industrial Market Reports released in 2014, promi- nent national real estate firm Cushman & Wakefield listed average lease rates for industrial space in NEPA that were 74% of those in Central New Jersey and 59% of those in Northern New Jersey. 08 UTILITIES The region is utility strong with natural gas, public water and sewer, abundant power, and fiber service readily available to business parks. High pressure gas mains owned and maintained by UGI Penn Natural Gas provide service to area business parks. The discovery of an estimated 500 trillion cubic feet of natu- ral gas in the rock located under a 22.4 million acre area that covers much of NEPA, the Northern Tier of Pennsylvania, and Upstate New York, has had an enormous impact on the re- gional economy. The Marcellus Shale region has been rec- ognized as the “largest unconventional natural gas reserve in the world.” Thousands of acres in NEPA and the Northern Tier have been leased by natural gas companies. Billions of dollars are being invested here by Southwest US energy companies. Because of this investment in Marcellus Shale, NEPA is expected to have access to abundant and affordable natural gas for de- cades to come. Water quality is good and pressures are very strong.
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