IDA purchases parcel on former Nestle site

The former Nestle site in Fulton, seen above during demolition in 2018, has a new tenant in the Oswego County Industrial Development Agency. The IDA says it'll develop a parcel for future manufacturing potential.

FULTON — The city of Fulton this week agreed to sell a portion of the former Nestle site to the county’s economic development agency, which intends to construct a manufacturing facility at the location.

The County of Oswego Industrial Development Agency (COIDA) is purchasing the parcel on the southeast side of the former Nestle site from the city for $80,000. The Fulton Common Council unanimously approved the deal last week.  Officials say the estimated $4 million project could attract a manufacturer and provide meaningful jobs for the area.

COIDA CEO L. Michael Treadwell said the agency’s intent is to construct the manufacturing facility and believes the ensuing structure could provide some combination of at least 30 new or retained jobs for the area. Treadwell said the future facility has already attracted the attention of potential tenants.

“We’ve had communications with several different companies with interest in some or all of the 30,000 square feet,” Treadwell told The Palladium-Times this week. “It’s going to be designed specifically to attract or retain manufacturing in the city of Fulton.”

The proposed manufacturing facility would be located between South 7th Street and South 6th Street, which would be extended southeast from its current terminus at Fay Street.

Fulton Mayor Ron Woodward Sr., who is leaving office later this month after a three-decade career serving the city, expressed optimism about the project, saying any project that has the potential to generate tax dollars is a positive for the city as long as it fits into the surrounding neighborhood.

“It’s a step in the right direction,” Woodward said. “It’s good for Fulton. It’s positive and in the end when they’re done it will create jobs.”

City officials have consistently said there were a number of parties interested in developing the Nestle property, and the COIDA building, if realized, would be the third structure built on the site since the long-time chocolate factory was demolished in 2018. The COIDA building would join the Aldi supermarket and a facility currently under construction for Charter Communications, which, like the COIDA project, received REDC funding last week in the amount of $282,000.

“The more that goes in there the more it will continue to generate interest from people,” Woodward said in an interview Sunday.

COIDA is seeking roughly $1.5 million through multiple funding sources, including through the city of Fulton’s $10 million Downtown Revitalization Initiative (DRI) award, to cover a significant portion of construction costs. COIDA was awarded $850,000 for the project on Thursday as part of the state’s annual Regional Economic Development Council (REDC) awards.

Treadwell said COIDA is committed to the project but if some of the funding sources fall through, the agency might have to reevaluate the project or redesign a scaled back version of the building.

“But we’re hoping that’s not going to be the scenario,” he said, noting COIDA officials expect roughly 55 to 60 percent of the costs to come from the agency’s funds or financing from a local bank.

Despite not knowing about DRI funding until mid-2020, Treadwell said COIDA is completing as much of the preliminary work as possible in order to keep the project moving, and the agency is hoping to start construction next summer.

“We’re going to try to get construction started next summer, serious construction, and it would probably take six months or eight months to complete,” he said.

The completed structure would be owned by COIDA, which would lease the building to a manufacturer for at least five years. Treadwell said after the initial five-year period it’s possible the agency could sell the building to the occupant.

Woodward said some have expressed concern about the property not paying property taxes while in possession of COIDA, but pointed out the property isn’t currently generating any tax revenue for the city.

“It’s off the tax rolls right now, but the plan is — from what I’ve been told — to return it to the tax rolls eventually,” the mayor said.

Treadwell said COIDA has already completed much of the engineering and design work for the facility, and the acquisition of the property is another step forward in making the project a reality. He said, however, the parcel must be subdivided before the property sale can be finalized and then the agency can seek site plan approval from the city Planning Commission.  

Asked if COIDA had undertaken any similar projects in the past, Treadwell pointed to the 32,000 square foot structure currently occupied by Northland Filters in the city of Oswego.  Healthway — a company that manufactures residential and commercial air filtration products — used the building for several years before relocating to Pulaski, and Northland Filters currently occupies the space on Mitchell Street.

“We had a tenant in there that employed anywhere from 25 to 40 people for many, many years so it ended up being a very positive project and became even more positive when we sold (the building) to Northland Filters,” Treadwell said. “That was a very successful project.”

Fulton has a long history of manufacturing, and the Nestle site was home to a factory for more than 100 years. Woodward said there’s a desire to continue that manufacturing tradition, but noted the high costs of doing business in New York state make it unlikely large-scale manufacturers would decide to call the state home.

“You’re not going to see that big investment but that’s alright,” Woodward said. “The smaller ones will make up for it.”

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