Tasty Baking to move business to Navy Yard
The deal, to be announced today, was honed with state, city, Liberty Property officials.
Taking advantage of tax breaks, Tasty Baking Co. intends to move operations across town into a new bakery, distribution center and office building in the Philadelphia Navy Yard, according to people familiar with the plan.
It would lease roughly 25 acres, including a 350,000-square-foot plant as big as six football fields, from Liberty Property Trust, of Malvern, under a deal worked out with state and city officials and to be announced today, according to those people, who spoke on condition they not be named.
The value of tax incentives was not disclosed yesterday, nor was the cost of the development.
Parts of the Navy Yard lie in a Keystone Opportunity Improvement Zone, where qualified companies are exempt from many state and city taxes for up to 15 years. It is owned and run by the Philadelphia Industrial Development Corp., a nonprofit economic-development company chartered by the city.
Gov. Rendell was scheduled to make the announcement with company and perhaps city officials. Rendell's office gave no details beyond his schedule, which listed a "major economic-development announcement" at Liberty Property Trust's site in the Navy Yard.
Officials from Tasty Baking, Liberty Property Trust, and the PIDC did not return calls for comment.
While the move was not expected to create new manufacturing jobs, Tasty Baking's relocation to a modern urban site could provide a high-profile boost for industrial development of the waterfront, once bustling with manufacturing activity.
The Navy Yard is home to Aker Philadelphia Shipyard; pharmaceutical laboratory and manufacturer AppTec Laboratory Services Inc.; the headquarters of retailer Urban Outfitters Inc.; logistics firm Barthco International Inc.; and Vitetta Group Inc., an architectural firm.
Last year, Philadelphia had just 30,000 manufacturing jobs, down from 37,000 four years earlier, according to the U.S. Bureau of Labor Statistics.
Tasty Baking is one of the biggest among roughly 1,300 Philadelphia manufacturing companies, most of which employ fewer than 20 people, said Steve Jurash, president of the nonprofit Urban Industry Initiative, a Philadelphia manufacturing-development advocacy group. Many share the problem of finding affordable, modern space, preferably on one floor, Jurash said.
Tasty Baking has been struggling at its own six-story, 85-year-old building on Hunting Park Avenue in the city's Nicetown neighborhood.
The company, an icon to many Philadelphians and maker of Tastykake Krimpets and Honey Buns, among other pastries, had seriously considered relocating its main bakery outside the city, according to Jurash.
The company employs about 1,100 people, roughly half in Nicetown.
It was unclear how many people could be affected by the relocation.
According to a person who has seen the development plans, Tasty Baking's new bakery and distribution center would be built on 25 acres on the southern end of the Navy Yard, an area known as Girard Point.
Tasty Baking also would lease roughly a third of a new 90,000-square-foot office building that Liberty Property Trust intends to develop near the main gate of the Navy Yard. The building would be called Three Crescent Drive, the next phase of Liberty's Navy Yard Corporate Center, which already includes one new office building, the person said.
Separately, Liberty also intends to develop an additional 15 acres next to the Tasty Baking site for "other distribution operations," according to the person.
For city and state officials, the deal would keep Tasty Baking in the city and would be a big step toward restoring the Navy Yard as a major economic site. Once employing 11,000 as the U.S. Naval Shipyard, it was closed by the U.S. Defense Department in the 1990s.
News of the development was confirmed after markets closed yesterday. Tasty Baking's shares closed at $8.94, up 29 cents or more than 3 percent. Liberty Property Trust shares closed at $47.78, down 12 cents.