Warehouse proposed for South Street

By Alberto Gilman
Posted 4/17/24

A new warehouse distribution center has been proposed on South Street in the City of Newburgh at the former DuPont-Stauffer Landfill site. The City of Newburgh Industrial Development Agency (IDA) are …

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Warehouse proposed for South Street


A new warehouse distribution center has been proposed on South Street in the City of Newburgh at the former DuPont-Stauffer Landfill site. The City of Newburgh Industrial Development Agency (IDA) are reviewing the proposal and are considering providing certain tax exemptions for the proposed project.

A public hearing on the project was held on Wednesday, March 27 with no public comments made. A proposed resolution to hold a second public hearing on the project was presented at the IDA meeting on Monday, April 15 but did not pass.

A project summary document on the city website reports the project is represented by applicant IV5 Newburgh South Logistics Center. The proposal is for a new 416,320 square foot distribution facility. The warehouse would be built on 49.6 acres of land at 700 South Street in the city. There are no current buildings on the site. A tenant has not been identified.

The document estimates 225 total jobs (200 full-time and 25 part-time) would be created. The average estimated annual salary of jobs to be created would be $80,000 for full-time and $40,000 for part-time. The reported annualized salary range for jobs to be created would be $60,000 to $150,000.

The property, purchased on July 3, 2023 for $5.5 million, is located in the Industrial Zoning District of the city. The site would be serviced for water and sewer by the City of Newburgh. Heat and electric utilities would be serviced by Central Hudson Gas & Electric Corp. The applicant has indicated that the future tenant of the property would desire future storage racks or equipment.

The cost of the proposed project would be $53.5 million. According to the March 27 meeting transcript, the applicant has requested from the city IDA a ten-year payment in lieu of taxes (PILOT) agreement at an estimated value of $4.2 million, an exemption from mortgage recording taxes at an estimated value of $280,818 and an exemption from New York State sales and compensating use taxes at an estimated value of $1.5 million. The transcript also notes that “the requested PILOT is consistent with the adopted Uniform Tax Exempt Policy of the IDA.”

The city IDA has engaged with a consultant, MRB Group, who prepared a cost benefit analysis and test of reasonableness analysis for the project. The updated cost-benefit analysis prepared in January 2024 highlights that the construction phase will create 105 jobs that generate $9.2 million in wages, and 254 permanent jobs, earning $19.9 million in annual wages. Orange County would also benefit from the project with “an additional one-time sales tax revenue of $60,433 associated with construction wages earned during the site’s renovation and construction.” Under proposed PILOT terms, The project will also generate an increase of $5.3 million in additional property tax revenue on current taxes for the city, the county and the Newburgh Enlarged City School District. Over the life of the PILOT, the fiscal benefits will be approximately $6.8 million.

A letter dated January 11, 2024 from MRB provided the following summary of findings: “We find that the Applicant’s requested assistance, including the sales tax exemption, the mortgage recording tax exemption and the PILOT abatement schedule, as amended, provides the Developer a reasonable, risk-adjusted return and the Project’s financials appear to be adequate for financing purposes.”

At the meeting on March 27, Attorney Charles Bazydlo, the applicant’s outside counsel, reported that the project was once where the DuPont-Stauffer Landfill operated. It was later acquired by AstraZeneca, a British-Swedish pharmaceutical company.

“The site has been the subject of a pretty intensive environmental remediation over a number of years. The State has thus concluded that investigation into the remediation that was done,” said Bazydlo. “There is still more work to be done as part of the development, and I mention that because that is one of the challenges about this site that has kind of hindered its redevelopment and use, has been that past history of both the manufacturing and also the encapsulated landfill that’s on a portion of the property.”

Bazydlo explained that access for trucks would be off of South Street, while employees will access the site via Pierces Road. Conceptual approval for the South Street entrance has been received from the New York State Department of Transportation but formal permits would still be required. The site plan for the project has been previously approved by the City Planning Board and variances related to parking were granted by the City Zoning Board of Appeals.

William Pasik of Brookfield Properties also addressed the landfill portion of the property. “We’re not going to be touching that. That is covered by an 18-inch thick geomembrane plus fill on top of that for the safety of our employees at the future proposed facility and for the people in the neighborhood. So we’re not going to touch that,” said Pasik.

In the summary report, the applicant has estimated that the completion of the project would occur by February 28, 2025. The next scheduled city IDA meeting is Monday, May 20. Project documents can be found online at the city’s website.