Creating jobs and stimulating the economy is our highest priority. That is why we worked so hard recently to not only keep Fresh Direct in New York City but to help it expand its operations in the Bronx.
Fresh Direct is a true New York success story, growing over the last decade from a small startup to a company with almost 2,000 employees. Small businesses are the backbone of our city; when they grow, we want them to grow here in the five boroughs — not in the suburbs or in another state.
When Fresh Direct outgrew its current headquarters in Long Island City and began making plans to expand its operations, we worked in partnership with Gov. Cuomo to ensure that those new jobs would be created in a community that greatly needs them: the South Bronx.
Earlier this month, Fresh Direct made a long-term commitment to remain in New York City by building a new headquarters in the South Bronx. This will have a major impact on the local community: 2,000 jobs paying an average of $16 an hour will move in. And over the next 10 years, Fresh Direct expects to hire 1,000 more workers — a major lift to the city and especially the local community, which currently has the highest unemployment rate in the five boroughs.
Fresh Direct will build its new headquarters on land that has been dormant for decades — a symbol of the revitalization that has happened across so much of the Bronx, thanks in large part to major city investments in housing and economic development. Today, the future of the Bronx can be seen in the families and companies that are moving in, not — as they did during the 1970s — moving out.
Fresh Direct’s investment in the Bronx was made possible by several state and city programs, leading to an overall public incentive package valued at more than $120 million — over the next 25 years — to stimulate this tremendous job growth.
Some have criticized the public investment in this project, but there are several important points to bear in mind:
First, these programs, along with other benefits, will cover just 23% of the total construction cost of the project and help defray a small portion of their operating expenses. The remaining 77% of construction costs will be funded by Fresh Direct — a major private investment in an area where jobs are too scarce.
Second, New Jersey, which made a strong push to lure the company, had offered tax credits worth 100% of the project costs. We refused to get into a bidding war, but nor could we ignore New Jersey’s offer.
Third, this investment will not only ensure that we do not lose thousands of current and future jobs to New Jersey, but the new economic activity will generate over $250 million in tax revenue for the city over the next 25 years. That’s good news for all New Yorkers and a huge return on our investment.
Finally, if Fresh Direct does not keep some of its commitments to the Bronx, the city and state will be able reclaim benefits.
In addition, after discussion with our offices, Fresh Direct has committed to hiring local residents, accepting public assistance benefits and exploring expanding Fresh Direct’s delivery service to the borough. They will also begin converting their truck fleet to lower-emission vehicles by purchasing electric trucks — which will be manufactured in the Bronx. The new headquarters will be in an industrial area near highways and bridges, meaning most trucks won’t have to travel through residential neighborhoods at all.
Job creation is our No. 1 priority, and the expansion of Fresh Direct in the South Bronx will benefit local residents and all New Yorkers for decades to come.
Bloomberg is mayor of New York. Diaz is Bronx borough president.
