Financing & Incentives

Food Retail Expansion to Support Health (FRESH)

FRESH, an initiative of Mayor Bloomberg’s Five-Borough Economic Opportunity Plan, promotes the establishment and retention of neighborhood grocery stores in underserved communities by providing zoning and financial incentives to eligible grocery store operators and developers.

Initiative Overview

The FRESH initiative comes as a response to a study conducted for the Mayor's Food Policy Taskforce by the New York Departments of Health and City Planning and the New York City Economic Development Corporation which showed that many low-income areas across the city are underserved by neighborhood grocery stores. The resulting lack of nutritious, affordable, fresh food in these neighborhoods has been linked to higher rates of diet-related diseases, including heart disease, diabetes, and obesity.

Cactus Holdings, d/b/a Western Beef, was the first company to receive incentives through the FRESH program. Western Beef closed on a $5.5 million NYCIDA industrial incentive transaction on March 31, 2010. The project was financed by a New Markets Tax Credit loan through Capital One and will enable Western Beef to purchase and renovate an approximately 65,000 square foot facility that will house a new Western Beef supermarket and warehouse facility in the Tremont section of the Bronx. Total project costs are $11.45 million. Renovations and a reconfiguration of the existing facility are anticipated to be complete in nine months, and employment at the facility will ramp up to approximately 125 full-time equivalent employees.

Eligibility Requirements

The FRESH program is open to grocery store operators renovating existing retail space or developers seeking to construct or renovate retail space that will be leased by a full-line grocery store operator. Stores that benefit from the program must be located in an eligible area and meet the following criteria:

  • Provide a minimum of 6,000 square feet of retail space for a general line of food and nonfood grocery products intended for home preparation, consumption, and utilization;
  • Provide at least 50 percent of retail space for a general line of food products intended for home preparation, consumption, and utilization;
  • Provide at least 30 percent of retail space for perishable goods that may include dairy, fresh produce, fresh meats, poultry, fish, and frozen foods; and
  • Provide at least 500 square feet of retail space for fresh produce.

FRESH-eligible Zoning Areas

Stores that benefit from the program must fall within designated FRESH-eligible areas, shown below.

Stores that benefit from the program must fall within designated FRESH-eligible areas

Fresh Financial Incentives

The following financial incentives are available to eligible grocery store operators and developers through the New York City Industrial Development Agency (NYCIDA).

All NYCIDA benefits are discretionary. Companies requesting assistance from the NYCIDA will be evaluated by NYCIDA staff individually to determine specific eligibility. All benefits are, by statute, subject to the approval of the NYCIDA’s Board of Directors. Companies must request NYCIDA assistance prior to entering into any property lease, acquisition or renovation contracts, unless such contracts are contingent upon NYCIDA assistance. Learn more about the Industrial Development Agency (NYCIDA).

Real Estate Tax Reductions

Land Taxes
  • Abatement equal to $500 multiplied by each full-time employee or part-time equivalent at time of application may be abated for 25 years, or abatement equal to full value of land tax for project sites located within Empire and Empowerment Zones.
  • A phase-out of the benefit begins in year 22 and continues through year 25 at 20 percent each year. In year 26, land taxes increase to full amount.
Building Taxes
  • Stabilization of building taxes based on pre-improvement assessed value for 25 years.
  • A phase-out of the benefit begins in year 22 and continues through year 25 at 20 percent each year. In year 26, building taxes increase to full amount.

Sales Tax Exemption

An exemption from the 8.875 percent sales tax on materials to construct, renovate or equip facilities.

Mortgate Recording Tax Deferral

A deferral of mortgage recording tax relating to the project's financing, equal to 2.05 percent of the mortgage amount for mortgages of $500,000 or less, and 2.80 percent for mortgages greater than $500,000.

Fresh Zoning Incentives

The following zoning incentives are available to eligible grocery store developers through the New York City Department of City Planning.

Additional Development Rights

One additional square foot of floor area in mixed residential development and commercial buildings for every square foot provided for a grocery store, up to a 20,000 square foot limit.

Reduction in Required Parking

  • Stores up to 40,000 square feet in commercial districts that permit residential buildings with ground floor retail will not be required to provide parking.
  • First 15,000 square feet exempt from parking in other Commercial and Light Manufacturing districts.

Larger as-of-right Stores in Light Manufacturing Districts

Grocery stores up to 30,000 square feet permitted in M1 districts.

Other Incentives

New York Healthy Food & Healthy Community Fund

Grocery store operators and developers in underserved communities may be eligible to apply for loan and grant financing for capital costs including real estate acquisition, construction, leasehold improvements, and equipment through the New York Healthy Food & Healthy Communities (HFHC) Fund.

The HFHC Fund is a public-private partnership established to promote healthy communities statewide and is managed by The Low Income Investment Fund (LIIF) along with The Food Trust. For more information about the fund please visit http://www.liifund.org/programs/healthy-food/.

NYSERDA Energy Efficiency Benefits

Grocery store operators and developers can independently access energy efficiency benefits through programs offered by the New York State Energy Research and Development Authority (NYSERDA). Such programs include:

Contact Us

Please visit www.nyc.gov/fresh to see a detailed, searchable map of the FRESH program areas, as well as a list of current projects. For additional program details, eligibility requirements, and application information please email fresh@nycedc.com.

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