Biopharma, Health Care, Food-Beverage Clusters Leading the Way for Economic Growth in Orange

John Jordan | September 2015

GOSHEN—With three quarters of the year complete, Orange County has scored its fair share of business attractions that will create numerous construction jobs as well as high-paying permanent jobs upon completion.

Real Estate In-Depth sat down recently with the staff of the Orange County Partnership, the economic development agency for Orange County, to discuss the major business attractions and notable expansions that have taken place so far in 2015.

Bill Fioravanti, director of business attraction for the Orange County Partnership, said, “Last year was a pipeline building year. We had a lot of leads and a lot of projects in the pipeline that we were hoping were going to break loose this year and they really have.”

Both Fioravanti and Orange County President and CEO Maureen Halahan agreed that while the year has been very busy with prospects and significant transactions, the agency is now focused on back-filling what has become a much shorter supply of shovel-ready projects for future development. The Partnership is also looking at properties in the county’s three major cities: (Middletown, Newburgh and Port Jervis) that could be candidates for adaptive reuse developments.

The Orange County Partnership handled a total of 42 attraction leads. The breakdown of industry sectors interested in setting up operations in the county are very diverse and include: 21 manufacturing companies, 5 tourism/destination concerns, 3 agribusiness ventures, 5 warehouse-distribution projects, 7 energy ventures and 1 training opportunity.

Some of the more high profile projects that have closed so far in 2015 include Angry Orchard Cider Co., which officially broke ground earlier this summer on the construction of its new cidery, tasting room, and hard cider research-and-development center. The more than $5-million project is being built at a 60-acre apple orchard in the Town of Montgomery.

 First launched in 2012, Angry Orchard is the number-one selling hard cider in the US, where cider consumption has nearly quintupled since 2010.

In another attraction win in the food and beverage sector, Amy’s Kitchen has chosen a site in the Town of Goshen as the home for its new manufacturing facility. A total of 60% of its products made in California and Oregon— primarily frozen meals and canned soups—are currently being shipped east of the Mississippi. The company intends to spend approximately $95 million to build its 349,900-square-foot facility. The project is expected to create 681 jobs.

Partnership officials also noted that Kikkerfrosch Brewery is making plans to begin construction in the Village of Goshen on a 100,000-square-foot brewery that will produce over 200,000 barrels of German-style lager in its first year. The over $30-million project will create 80 full-time, high-paying jobs.

Orange County has already seen a host of micro-brewers invest in the county and set up operations, including Newburgh Brewery and most recently Clemson Brothers Brewery in Middletown. Both companies redeveloped former industrial properties in the center of their respective downtown districts.

The county has also scored two huge attraction transactions with biopharmaceutical firms. AmerisourceBergen announced plans in June to build a new nearly $40-million distribution center in the Town of Newburgh, The project is expected to create 121 jobs for the Fortune 500 pharmaceutical sourcing & distribution company.

Another major project in the pipeline has been nicknamed “Project Blackhawk.” To be housed in the Town of Hamptonburgh, the company has begun construction on a 341,000-square-foot warehouse facility also at the Hudson Valley Crossing property. While county officials would not divulge the name of the company that is currently in approvals for the project, published reports identified the user as McKesson Corp, a healthcare services and information technology company that is currently ranked 11th on the Fortune 500 list.

Also in the field of healthcare, PharmaCann has secured state approval to build a medical marijuana facility in the Town of Hamptonburgh. The firm is now in the approval process to build its facility that will grow state-approved medical marijuana products. The Illinois-based firm will build its facility on more than 42 acres at the Hudson Valley Crossing property. Phase one of the project calls for a 25,600-square-foot “head house” and two 47,606-square-foot grow buildings, along with 98 parking spaces and three secure loading docks.

Another high profile corporate name that is investing in Orange County is Pratt & Whitney. The aerospace giant is building a state-of-the-art manufacturing facility for its new Technical Coating Systems operations. Pratt recently acquired Wallkill’s Advance Coating Technologies and, through this venture, will apply state-of-the-art coatings to engine turbine components, including blades and vanes, through the use of advanced manufacturing processes, according to the Orange County Partnership. This $140-million project includes a full build-out of the 71,000-square-foot former headquarters of Durasol Awnings, which recently relocated elsewhere in the county. The project is expected to create 100 new jobs.

After years in the approval process, it appears a shovel will turn the first dirt on the CPV Valley Energy project in Wawayanda very soon. The $900-milion project will provide 650 megawatts of new electric generation capacity and create more than 500 construction and operations jobs in Orange County.

A key element of any economic development program is the retention of businesses that require assistance to either stay or expand. Amanda Dana, business retention and expansion specialist with the Orange County Partnership, reported that there are 28 pending expansions and eight retention projects in the pipeline.

So far in 2015 four expansion projects have closed. A major source of new investment and jobs for Orange County is in the healthcare field. Orange Regional Medical Center broke ground recently on a new $99-milion expansion project on its campus on East Main Street in the Town of Wallkill. Work is now underway on the new 153,000 square foot, five-story medical office building and a 26,000 square foot, single-story cancer center at the hospital’s main campus. When completed in the fall of 2016, it will help relocate many outpatient services currently provided at other off-campus ORMC locations into the new, state-of-the-art buildings on the existing 73-acre hospital campus.

Major healthcare provider Crystal Run Healthcare opened a new 66,000-square-foot facility in the Town of Newburgh recently and is making preparations to begin construction on a new 72,000-square-foot medical center in the Village of Monroe. Crystal Run Healthcare currently has offices in Goshen, Middletown, Monroe, Newburgh, Warwick, Port Jervis as well as in Sullivan and Rockland counties and New Jersey.

In addition, Middletown Medical is looking to build a 20,000-square-foot $8-million health care facility in the Town of Wallkill on its present campus. That proposal is currently in the approval process. In addition, Middletown Community Health Center is attempting to finalize plans to bring operations into the former O&W Railroad station site in Middletown.

There are a host of other expansion projects in the pipeline that should get underway soon including a $20-million expansion by STERIS/Isomedix in the Village of Chester, Old Dominion Freight Lines in the Town of Wallkill and Primo Sorts in the Town of Chester to name just a few.

Another significant retention involved a collaborative effort between Orange County, the Orange County Partnership, the Orange County Industrial Development Agency and the Town of Wallkill that resulted in Piller USA building a new 24,000-square-foot headquarters on West Warren Drive in the Town of Wallkill. The $2.8-milllion project broke ground in April and will create approximately 84 construction jobs. Piller USA, a global company that produces large capacity rotary UPS and kinetic energy flywheel storage systems, employs more than 800 workers worldwide in more than 50 countries.

Dana said that Piller was on the fence about possibly moving out of the area. “This was a great retention project because it saved about 49 jobs and their new facility will be a hub for them,” she said.

John Jordan
Editor, Real Estate In-Depth