Cold cuts maker Dietz & Watson Co. will build a $50 million, 200,000-square-foot trucking and distribution center on 20 acres next to its Tacony Street headquarters and meat plant, on land once part of the defunct Frankford Arsenal.

The decision was first reported from industry sources June 18 in The Inquirer and confirmed Tuesday by company, city and state sources.

The center will employ 110, who will pack and ship Dietz & Watson foods to delicatessens and markets. The company expects to hire around 50 additional workers over the next few years.

The center will replace a larger seven-year-old warehouse in Delanco, Burlington County, that was destroyed last summer in an 11-alarm fire. Dietz & Watson employs almost 700 at its Tacony Street offices and plant. The company also processes cheese in Corfu, N.Y., and turkey and chicken in Baltimore.

The Philadelphia site "was where we wanted to be in the first place. It just wasn't available before," said Louis Eni, third-generation chief executive of the family-owned company.

After demolishing structures where U.S. Army munitions were once made and stored, developer Mark Hankin had hoped to build retail stores on the site. But that plan had stalled when last summer's fire forced Eni to look for a replacement location.

"We were thinking we would rebuild in Delanco," Eni said. But Mayor Nutter promptly called him and asked him to meet with Philadelphia Industrial Development Corp. chief John Grady to talk about city locations.

"The conventional wisdom was that Philadelphia had not been very business-friendly. But we found the city really wanted to make this happen," Eni said. "They really do have a revitalized vision for bringing business back into the city."

City Councilman Bobby Henon also pressed for a Northeast Philly site.

State aid helped close the deal. Gov. Corbett has agreed to give the 75-year-old company more than $7 million in taxpayer funds for the project, including $5 million in matching construction grants from the Redevelopment Assistance Capital Program (RACP), $2 million from the Pennsylvania First Program, and $125,000 in training grants. The state also offered loans: $5 million from the Machinery and Equipment Loan fund and $2.25 million from the Pennsylvania Industrial Development Authority.

Philadelphia helped arrange the company's $12 million property purchase by swapping city-owned industrial land with land owned by the state boating commission, which maintains a public dock on the property, Deputy Mayor Alan Greenberger said.

Dietz & Watson paid about $6 million for its piece of the land. The city paid the rest and will hold around 30 additional arsenal acres for future industrial users, who have replaced residential and retail developers as the most likely users of vacant river sites in Northeast Philadelphia, says the PIDC's Grady.

"We did get a better offer from New Jersey," Eni said. The Garden State offered $30.85 million in incentives over 10 years.

"But we would have had to move our corporate offices and some other important operations to New Jersey," Eni said. "New Jersey was very generous and very aggressive. But between what Philadelphia was able to do and what Pennsylvania offered us, we felt there would be quite a bit of efficiency in managing our business as a cohesive unit," all in Tacony.

"We feel we owe quite a bit to the Township of Delanco. They were great neighbors," Eni added. "It was not an easy time after the fire. We're going to do all we can to sell that to someone who can bring some jobs back into that neighborhood."