Philadelphia produce trade looking at last chance for new market
Philadelphia produce trade looking at last chance for new market
PHILADELPHIA -- Like wandering nomads seeking a new home, Philadelphia's produce wholesalers have endeavored to find a new market location for the last five years. Potential sites have come and gone in a series of mostly political events. The effort to move this spring was even disrupted by a bald eagle's nest on a proposed site that was reclaimed by Pennsylvania Gov. Ed Rendell.
In an exclusive interview with The Produce News, Sonny DiCrecchio, general manager of the Philadelphia Fresh Food Terminal Corp., said that he has one last opportunity for the market to move to an affordable location. In a significant irony, the location is across the street from the existing market. Substantial hurdles must be cleared to solidify the site, but Mr. DiCrecchio said that those challenges are being investigated now and will be resolved by Oct. 1.
By that time, either a revised plan to build an affordable market will be in place or the market's 35 businesses will receive refunds from what is left of the money they contributed to design a new market. Then all those businesses will be left to their own devices to determine their own futures.
The existing produce market, which was opened as a state-of-the-art facility in 1959, is falling apart and has a very limited future.
When Gov. Rendell announced in mid-May that he had determined that the eagle-inhabited site on Philadelphia's old naval yard would be used to build a huge new sea container port instead of the new produce market, Mr. DiCrecchio hired a commercial real estate firm to study every possible location within a close proximity of downtown Philadelphia.
Mr. DiCrecchio scheduled a June 12 meeting with his market board to report on results of new potential sites. By June 11, he had eliminated all the potential sites based on cost or location inadequacies. He told The Produce News that he spent the afternoon of June 11 agonizing over how he was going to break the news to his board that there was nowhere left to move.
On his way home that evening, he decided to drive around the Philadelphia Food Distribution Center. Across Lawrence Street, which runs on the west side of Philadelphia's produce and fish markets, is a city block that is occupied by a warehouse owned by Houston-based Sysco Corp. Also on that block is a building that houses Samuels & Son Seafood Co. Inc. and a third facility occupied by foodservice distributor C.W. Dunnet & Co. A large part of this block is vacant, having once housed a city incinerator.
While it has always been the produce market's first choice to stay in the Food Distribution Center, that option had been ruled out in recent years. Rebuilding within the existing market was long ago deemed infeasible because it would be too difficult to do this while being fair to all parties.
But with no other options, Mr. DiCrecchio considered the recent news that Sysco had announced plans to build a new warehouse a few blocks away on what is known as the Pasha site, which was once considered for the produce market but was determined to be too small.
Mr. DiCrecchio parked his car and paced off the dimensions of this block, estimating that it is about 40 acres. While that is less space than is needed for a new produce market, its proximity to the old market may allow the refrigeration, built in the early 1990s, to bolster the old market to be utilized in a new plan.
Seeing this and various other advantages of building a new market next door to the old one, Mr. DiCrecchio spent the night of June 11 scribbling new plans to make a bare-minimum market that would fit on 40 acres. The Naval Yard plan was for a market with over 800,000 square feet.
Mr. DiCrecchio walked into his June 12 board meeting with a 550,000 square-foot market plan.
His board members saw the many benefits of moving across the street while keeping relatively modern existing refrigeration on the same location. Since June 12, Mr. DiCrecchio has worked to develop this new plan. "We can't downsize any more," he noted.
Under the plan, the existing fish market would remain in place between the old and new produce markets, but vacant land at the end of the fish market is owned by Joe Procacci, owner of Procacci Bros. Sales Corp./Garden State Farms, who is on the board of the Philadelphia Fresh Food Terminal Corp. Mr. Procacci has agreed to sell this real estate to the produce market, which would link the old and new sites so there can be a traffic flow without entering public streets.
Mr. DiCrecchio currently is speaking with the owners of the Samuels and Dunnet companies to ask them to move and build new facilities alongside the old market so their current locations can be used for a solid block at the new site.
The move of Sysco to the Pasha site is the trump card in this deal, Mr. DiCrecchio said. Pasha is a couple blocks closer to the Delaware River waterfront, and its location has been earmarked for port use. Pennsylvania Rep. Bill Keller, whose web site lists his occupation as longshoreman, has threatened to sue the Philadelphia Regional Port Authority, which owns the Pasha site, if the site is put into a use other than one related to the port of Philadelphia.
Mr. DiCrecchio met on the morning of Aug. 20 with Mr. Keller to explain why it was so important to the produce market to access the property now occupied by the Sysco warehouse.
Mr. Keller told Mr. DiCrecchio that the lawsuit would go forward unless Sysco gives a solid commitment to use that facility to export food from the port in its global-service contract with the U.S. military.
"We have to bring everyone to the table: Sysco and the political pieces. We have to bring everything above board," Mr. DiCrecchio told The Produce News.
For a variety of practical reasons, Mr. DiCrecchio said that these decisions must be made by Oct. 1. In that time, due diligence will be done on the potential construction site. He has given his tenants a 48-month building timeline, but he hopes less time that than will be needed. If Sysco takes two years to build its new warehouse, market construction could begin at the opposite end of the property, thus buying Sysco time to move.
There, perhaps by a thread, hangs the future of the Philadelphia wholesale produce market.
Mr. DiCrecchio said that he would not move ahead with the new market plans if a potential lawsuit hangs in the future. He said that he would no longer lead the Philadelphia market forward on promises and without solid documentation that plans will actually happen.
Five years ago, the state promised Philadelphia $100 million plus $80 million in bonds to build a new produce market. In May, Gov. Rendell noted those promises are still valid. The problem is that $180 million builds much less of a market today than it would have five years ago.
Mr. DiCrecchio said that the governor is aware of this discrepancy, and Mr. DiCrecchio holds hope that Gov. Rendell might be able to provide some additional money if absolutely necessary.
"We need to keep the cost under $200 million," said Mr. DiCrecchio. "We don't have $200 million now, but closer to $180 million. We can't cut any more. This is it."
He said that this latest market plan saves a lot of money because the 1990s refrigeration investment can still be utilized. The mortgage to pay for the existing refrigeration will be closed in three years. Elimination of that debt is critical in paying for a new market. Using part of the old market is the only way Philadelphia could have a new market for $200 million, he noted.
Mr. DiCrecchio said that he would be meeting with each of the market's 35 operators over the next two months to ask about their individual needs in a new market.
"I think we have a helluva shot" at having the new plan work, Mr. DiCrecchio said with a note of cautious optimism.
In an exclusive interview with The Produce News, Sonny DiCrecchio, general manager of the Philadelphia Fresh Food Terminal Corp., said that he has one last opportunity for the market to move to an affordable location. In a significant irony, the location is across the street from the existing market. Substantial hurdles must be cleared to solidify the site, but Mr. DiCrecchio said that those challenges are being investigated now and will be resolved by Oct. 1.
By that time, either a revised plan to build an affordable market will be in place or the market's 35 businesses will receive refunds from what is left of the money they contributed to design a new market. Then all those businesses will be left to their own devices to determine their own futures.
The existing produce market, which was opened as a state-of-the-art facility in 1959, is falling apart and has a very limited future.
When Gov. Rendell announced in mid-May that he had determined that the eagle-inhabited site on Philadelphia's old naval yard would be used to build a huge new sea container port instead of the new produce market, Mr. DiCrecchio hired a commercial real estate firm to study every possible location within a close proximity of downtown Philadelphia.
Mr. DiCrecchio scheduled a June 12 meeting with his market board to report on results of new potential sites. By June 11, he had eliminated all the potential sites based on cost or location inadequacies. He told The Produce News that he spent the afternoon of June 11 agonizing over how he was going to break the news to his board that there was nowhere left to move.
On his way home that evening, he decided to drive around the Philadelphia Food Distribution Center. Across Lawrence Street, which runs on the west side of Philadelphia's produce and fish markets, is a city block that is occupied by a warehouse owned by Houston-based Sysco Corp. Also on that block is a building that houses Samuels & Son Seafood Co. Inc. and a third facility occupied by foodservice distributor C.W. Dunnet & Co. A large part of this block is vacant, having once housed a city incinerator.
While it has always been the produce market's first choice to stay in the Food Distribution Center, that option had been ruled out in recent years. Rebuilding within the existing market was long ago deemed infeasible because it would be too difficult to do this while being fair to all parties.
But with no other options, Mr. DiCrecchio considered the recent news that Sysco had announced plans to build a new warehouse a few blocks away on what is known as the Pasha site, which was once considered for the produce market but was determined to be too small.
Mr. DiCrecchio parked his car and paced off the dimensions of this block, estimating that it is about 40 acres. While that is less space than is needed for a new produce market, its proximity to the old market may allow the refrigeration, built in the early 1990s, to bolster the old market to be utilized in a new plan.
Seeing this and various other advantages of building a new market next door to the old one, Mr. DiCrecchio spent the night of June 11 scribbling new plans to make a bare-minimum market that would fit on 40 acres. The Naval Yard plan was for a market with over 800,000 square feet.
Mr. DiCrecchio walked into his June 12 board meeting with a 550,000 square-foot market plan.
His board members saw the many benefits of moving across the street while keeping relatively modern existing refrigeration on the same location. Since June 12, Mr. DiCrecchio has worked to develop this new plan. "We can't downsize any more," he noted.
Under the plan, the existing fish market would remain in place between the old and new produce markets, but vacant land at the end of the fish market is owned by Joe Procacci, owner of Procacci Bros. Sales Corp./Garden State Farms, who is on the board of the Philadelphia Fresh Food Terminal Corp. Mr. Procacci has agreed to sell this real estate to the produce market, which would link the old and new sites so there can be a traffic flow without entering public streets.
Mr. DiCrecchio currently is speaking with the owners of the Samuels and Dunnet companies to ask them to move and build new facilities alongside the old market so their current locations can be used for a solid block at the new site.
The move of Sysco to the Pasha site is the trump card in this deal, Mr. DiCrecchio said. Pasha is a couple blocks closer to the Delaware River waterfront, and its location has been earmarked for port use. Pennsylvania Rep. Bill Keller, whose web site lists his occupation as longshoreman, has threatened to sue the Philadelphia Regional Port Authority, which owns the Pasha site, if the site is put into a use other than one related to the port of Philadelphia.
Mr. DiCrecchio met on the morning of Aug. 20 with Mr. Keller to explain why it was so important to the produce market to access the property now occupied by the Sysco warehouse.
Mr. Keller told Mr. DiCrecchio that the lawsuit would go forward unless Sysco gives a solid commitment to use that facility to export food from the port in its global-service contract with the U.S. military.
"We have to bring everyone to the table: Sysco and the political pieces. We have to bring everything above board," Mr. DiCrecchio told The Produce News.
For a variety of practical reasons, Mr. DiCrecchio said that these decisions must be made by Oct. 1. In that time, due diligence will be done on the potential construction site. He has given his tenants a 48-month building timeline, but he hopes less time that than will be needed. If Sysco takes two years to build its new warehouse, market construction could begin at the opposite end of the property, thus buying Sysco time to move.
There, perhaps by a thread, hangs the future of the Philadelphia wholesale produce market.
Mr. DiCrecchio said that he would not move ahead with the new market plans if a potential lawsuit hangs in the future. He said that he would no longer lead the Philadelphia market forward on promises and without solid documentation that plans will actually happen.
Five years ago, the state promised Philadelphia $100 million plus $80 million in bonds to build a new produce market. In May, Gov. Rendell noted those promises are still valid. The problem is that $180 million builds much less of a market today than it would have five years ago.
Mr. DiCrecchio said that the governor is aware of this discrepancy, and Mr. DiCrecchio holds hope that Gov. Rendell might be able to provide some additional money if absolutely necessary.
"We need to keep the cost under $200 million," said Mr. DiCrecchio. "We don't have $200 million now, but closer to $180 million. We can't cut any more. This is it."
He said that this latest market plan saves a lot of money because the 1990s refrigeration investment can still be utilized. The mortgage to pay for the existing refrigeration will be closed in three years. Elimination of that debt is critical in paying for a new market. Using part of the old market is the only way Philadelphia could have a new market for $200 million, he noted.
Mr. DiCrecchio said that he would be meeting with each of the market's 35 operators over the next two months to ask about their individual needs in a new market.
"I think we have a helluva shot" at having the new plan work, Mr. DiCrecchio said with a note of cautious optimism.
