In March 2006, NYCEDC and Pepsi announced plans for a new distribution facility in the Zerega Industrial Business Zone in the Bronx.
Pepsi sought to solidify its position in New York City by undertaking two signature projects: the construction of a 214,000 square foot, state-of-the-art distribution facility and the acquisition and renovation of a leased facility in Maspeth, Queens.
Prior to purchasing the site from the City, Pepsi considered moving operations out of the Bronx to New Jersey. Despite New Jersey having higher real estate taxes and increased construction and renovation costs, the Elizabeth, NJ was projected to be considerably less expensive over a 20-year period.
Despite the New Jersey benefits, Pepsi sought to solidify its position in New York City by undertaking two signature projects: the acquisition of the Bronx site for the construction of a 214,000 square foot, state-of-the-art distribution facility (the “Brush Avenue Project”); and the acquisition and renovation of a leased facility in Maspeth, Queens. The advantages to Pepsi of remaining in New York City include proximity to its customers and avoiding disruption of its employment and distributor network.
The Brush Avenue Project involved a land sale and the development of a major distribution facility. The project received NYCIDA benefits, including sales tax exemptions on construction costs and a mortgage recording tax exemption.
At the time, Pepsi anticipated retaining 80 full-time equivalent positions in New York City and expected to retain over 80 full-time equivalent positions for distributors.
Pepsi completed its construction in March 2009 and has exceeded its employee projection by more than 30 percent. The independent distributors collectively employ an additional 182 personnel.
In order to remain competitive in the New York City area, Pepsi and its affiliate, Canada Dry, purchased and upgraded a facility that it has occupied as a tenant for many years in Maspeth, Queens.
Pepsi received sales tax exemptions on capital improvements, a mortgage recording tax exemption, and a Real Estate Tax stabilization in the form of PILOT benefits.
The Maspeth location is highly desirable to Pepsi and Canada Dry due to its stable workforce and close proximity to its customer base and employs 132 employees.