Dannon Unveils Headquarters Plans in White Plains

John Jordan | October 2016

The Source at White Plains

WHITE PLAINS—The Hudson Gateway Association of Realtors may have a new neighbor if incentives and approvals are granted by New York State, Westchester County and the City of White Plains.

Executives from The Dannon Company, Inc. unveiled plans for the possible relocation of the yogurt giant from Greenburgh to more than 100,000 square feet of space in Downtown White Plains at a meeting of the Westchester County Industrial Development Agency on Oct. 6.

The company currently occupies approximately 75,000 square feet of space at its headquarters at 100 Hillside Ave. in Greenburgh. Dannon is considering embarking on a $30.4-million renovation and construction project at 100 Bloomingdale Road, also known as 1 Maple Ave., at the Source at White Plains. Earlier this year, the Hudson Gateway Association of Realtors relocated its headquarters operations from the Westchester Pavilion Mall to approximately 16,000 square feet of space at the top floor of the Source at White Plains.

According to its application with the IDA for $1.273 million in sales tax exemptions in connection with the move, Dannon would relocate to approximately 60,000 square feet of space on the fourth floor of the Source at White Plains property and build another 23,000 square feet of “mezzanine space” atop its fourth floor offices. In addition, Dannon executives said at the IDA session last Thursday that the company would lease another approximately 20,000 square feet of space on the ground floor of the 240,000-square-foot property. The ground floor retail space, currently occupied by Morton’s Steakhouse and Destination Maternity, would be used for a food laboratory and cafeteria space. Dannon officials told the Westchester County IDA that the Morton’s and Destination Maternity leases expire in the spring of 2017. If the company decides to move to the White Plains property, Dannon expects to ink a 15-year lease with the building owner, Bloomingdale Road Investors LLC, an affiliate of UBS. Other major tenants at the property include Whole Foods, Dick’s Sporting Goods and The Cheesecake Factory.

Dannon in its application to the Westchester County IDA said that 14,000 of the existing space at the Source at White Plains that is currently part of the parking garage would be converted to office space.

Dannon, an affiliate of Dannone, S.A. of Paris, is now before the City of White Plains for a zoning amendment to permit the food laboratory use. The company has stressed that its preference is to stay in Westchester County and move to the White Plains property, although it has conducted an extensive search and is considering a site in Stamford, CT as well.

Michael Neuwirth, senior director of public relations for Dannon, said it is the company’s intention to occupy the new headquarters space by the beginning of 2018. The company in its application targets a start of construction at the Source at White Plains by April 3, 2017 and occupancy by October 2, 2017, although the company said those dates were subject to change. Dannon would relocate 440 full-time workers to White Plains and expects to add another 150 jobs over the first five years after the project is completed.

While he would not comment on its interest in a possible move to Stamford, CT, in its IDA application the company states, “The company has narrowed its focus to two sites—100 Bloomingdale Road and Stamford, CT—and is nearing a final decision, in which the IDA benefits proposed by Westchester County and the City of White Plains, as well as state incentives offered by Empire State Development, will play a significant role.” Dannon states in its filing that Empire State Development’s incentive proposal includes Excelsior Jobs tax credits and a Jobs Now Grant. The company did not divulge the value of the state incentive package.

Neuwirth said the company is attracted to the White Plains property because it would allow Dannon to keep its headquarters in Westchester County. The company has operated its headquarters in Westchester for more than 20 years and has leased space at the Greenburgh property since 2004.

The company, which had originally intended to lease 50,000 square feet of space at 100 Hillside Ave., decided before it moved into the building in 2004 to lease 70,000 square feet of space at the property. The company relocated its corporate offices from 120 White Plains Road in Tarrytown.

“We are exploring the options,” Neuwirth said of its intended corporate headquarters move. “Our preference would be to remain in Westchester County if that was a possibility based on various factors.”

Dannon stressed in its IDA application that the incentives by New York State, Westchester County and the City of White Plains “will play a major role in mitigating the significant expenses associated with this transaction, especially in a jurisdiction with comparatively high labor, tax and operating costs relative to other communities. The project is also highly desirable to other states, which have provided substantially higher incentive proposals. As such, the agency’s financial assistance is critical to the economic feasibility of the project.”

William M. Mooney III, director of the County Office of Economic Development, said of the company’s application for incentives, “Dannon has been a great asset for Westchester for many years. We are thrilled Dannon is considering this investment, which will keep jobs in Westchester and New York State, and we will continue to work closely with the company as it pursues its growth plans.”

In other IDA actions, Million Air is upgrading its corporate aviation facilities at the County Airport in White Plains with an $88-million renovation project that includes the construction of a new 50,000-square-foot hangar. The IDA approved issuing tax-exempt bonds, which will lower the project’s financing costs. Earlier this year, the County Board of Legislators approved a 30-year lease with Million Air at the airport.

Earlier that day, the county’s Local Development Corp. approved providing assistance to Bethel Methodist Home in its acquisition of Westchester Meadows, a continuing care retirement community in Valhalla, from Hebrew Hospital Senior Housing in a bankruptcy sale.

The LDC, which works with non-profits, approved $28.6 million in low-cost bond financing for Bethel, which it will use to refinance a loan and fund major interior and exterior renovations. In addition to the bond financing, the LDC approved a mortgage tax exemption of $208,000. Bethel plans to renovate and operate the facility, which currently consists of 120 independent residential apartments, 10 enriched housing apartments, 20 skilled nursing beds, common areas, indoor pool, and nursing, medical and dining facilities.

 

John Jordan
Editor, Real Estate In-Depth