With tenant, industrial park blooms in Bronx

Real Estate Weekly, Jan 20, 1993 by Therese Fitzgerald

An envisioned 90-acre industrial park in the South Bronx took a step toward materialization last week when New York's wholesale flower industry committed to relocate to a planned 120,000-square-foot facility.

At a City Hall press conference, The New York Flower Mart, Inc. an organization that represents New York's wholesale flower industry, signed a five-acre land lease with the developers of The Harlem River Transportation and Distribution Center, slated for the abandoned Penn Yards Central Rail Yards.

Between 15 and 19 wholesalers that now occupy space on Sixth Avenue in the mid-20's, are expected to lease space in the facility, designed by SPGA Group.

While this will remove the flower district from Manhattan, the event saves for the city an industry that is shrinking because of the lack of expansion space, the inefficiency of multi-story loft buildings and traffic congestion.

The Flower Market was represented in the transaction by Alan B. Weisman, senior vice president and director of industrial sales and leasing of Win. A. White/Grubb & Ellis. Neil Pariser, senior vice president of SOBRO Realty, represented Harlem River Yard Ventures, the private sector developers of the park. Weisman is credited with organizing the flower wholesalers and finding a place for them within the confines of the city.

SOBRO is the brokerage division of The South Bronx Overall Economic Development Corporation, which for 20 years has been exploring options for the rail yards site and which helped privatize the project.

'Now we take that land lease and we start getting financing,' said Pariser.

Harlem River Yards is located in the city's Port Morris In-Place Industrial Park, home to 800 industrial and distribution businesses.

The developer that won the request for proposal (RFP) was Harlem River Yard Ventures, an entity of the Albany-based Galesi Group. Harlem River Yard Ventures has signed a 99-year lease for the abandoned Penn Central rail yard.

The Galesi organization has built such facilities before. In Albany's tri-city area, they are developers of three industrial parks that total 8 million square feet. The parks are all connected to the Selkirk Rail Yards, the main railyard of Conrail, which also connects to the Hudson River.

"This facility will be the first state-of-the-art transportation facility in New York," said Anthony Riccio, vice president/project director with the Galesi Organization.

The industrial park is expected to feature: An intermodal rail-shipping link; more than 5 million cubic feet of temperature controlled warehousing; 200,000 to 300,000 square feet of nonrefrigerated distribution space; a 70,000-square-foot paper recycling and paperboard manufacturing plant; a waste management facility; a rail/truck/barge terminal for bulk cargoes.

According to Pariser, they are close to signing with several other major tenants, including Ponderosa Fibers, a company that provides paper de-inking.

Located at the Southern tip of the Bronx along the Harlem River. The Harlem River Transportation and Distribution Center has direct connection to Conrail, access to New York State Thruway, JFK and LaGuardia airports and the New Jersey Turnpike via the George Washington Bridge.

The city will provide relocation grants and tax incentives for employees. Galesi will also receive assistance with the infrastructure via grants and low-cost financing.

Francesco Galesi, chairman of Harlem River Yards Ventures said he anticipates $300 million in investment in The Bronx in real estate construction costs and some 1,500 jobs.

Growing Pains

The wholesalers, Weisman said, had simply outgrown their space on Sixth Avenue.

"Some guys are in 2,000 feet and they need 10,000 or 1,200," said Weisman.

After learning that most wholesalers wanted out of their current neighborhood, Weisman convinced them that, while they were competitors, it was important to organize. Thus was born the limited partnership that began to look for a new home.

While some lament that Manhattan has been stripped of its flower district, Weisman said the move actually preserves the wholesale flower business for the city. The wholesalers, he said, were determined to move from their current cramped Midtown South locales and the industry would have been splintered or dissolved. The wholesalers, Weisman reminds, were even considering New Jersey.

"What would have happened is each would have taken care of themselves," he said. "One would have moved to the Bronx, one to Queens ..."

Weisman, who will be helping the wholesalers dispose of their Manhattan space, also disputes onlookers that say there will be 'a whole' in Midtown South. The wholesalers, many of whom own their space, he said, occupy small storefronts, and when they do vacate, he said, there will be substantial demand especially from the Korean trading companies that have been springing up in the area.

"The properties are absolutely not going to sit empty and idle with empty storefronts," he said.

While this area of Sixth Avenue currently has an FAR of only 5, Weisman said, the city is examining rezoning, which will significantly increase the value of the properties and make way for grander development.