DRYDEN, N.Y. — Last week, the Voice broke news of a buyer for the former Vanguard facility on Dryden’s Hall Woods Road. Thanks to an application to the Tompkins County Industrial Development Agency (TCIDA), we have more details about the Knickerbocker Bed Company’s plans.
According to the paperwork submitted to the IDA, Knickerbocker, which was founded in 1919 and bills itself as “the oldest manufacturer in the bed frame industry”, seeks to expand from its New Jersey operations with the new factory in Dryden. The driving factor for them to seek an additional plant is that their newer product lines need more space. The firm specializes in heavy-duty steel bed frames and the newer designs they’re selling to hotels and institutions require more room to build – the Dryden factory would initially be home to their hospitality market division, and the long-term plans call for all frame production lines to be moved out of New Jersey and into Dryden.
“As Knickerbocker has transitioned into its new ‘Bed Architecture’ programs over the past 10 years, the existing facilities in New Jersey do not afford the proper space and manufacturing environment to continue to grow,” notes the IDA memo.
“The new product lines have more space intensive requirements due to the complexity in the process, and the size and scale of the equipment necessary. Knickerbocker’s new products for the hospitality and hotel industries are scheduled to launch in the third quarter of 2022. These products require more manufacturing space than their traditional offerings, thus creating the need for substantially more manufacturing space.”
The overall investment from Knickerbocker is estimated at $10,525,000. About $5.5 million would be spent to buy the 220,000 square-foot former Vanguard plant, with another $2.5 million for equipment, $1.5 million for the renovation, and smaller amounts for other associated costs. Knickerbocker explains in their submission that one of these reasons they’re seeking a tax break is to buy and install a more environmentally-friendly art powder coating system in the plant, rather than a less expensive baked enamel system that uses toxic paint solvents. Most of the financing comes from conventional loans and cash equity, along with an $800,000 grant award for expected from the state if they hit hiring goals.
On that note, the IDA application states that at opening in late 2022, Knickerbocker expects to have three dozen staff on-site, and 83 employees within three years. The majority of these would be entry-level factory workers making about $40,000/year, and all positions would be “far in excess of” living wage. The renovation would also create 20-25 construction jobs.
As for the tax breaks themselves, there are a trio of breaks Knickerbocker is seeking. One is an exemption on paying sales taxes on the new factory equipment, valued at $200,000. The second is a tax exemption on the mortgage recording tax, valued at $21,060. The last and largest is a seven-year payment in lieu of new property taxes, valued at $652,757. In total, we’re talking $873,817 in tax savings in exchange for the $10,525,000 investment and related job creation.
“We currently have two factories, 30,000 and 64,000 Square feet. The $10.6 million investment will repurpose a vacant industrial building into a state-of-the-art manufacturing facility that is best in industry class, and capable of attracting a loyal
workforce that is dedicated to building industry leading products. The project will create 80 new jobs over three years. This project is a large undertaking for our company and there is a gap in financing that local and state assistance is critical to help fill,” says Knickerbocker CEO Richard Polevoy in the application.
It’s certainly unusual to see a major new industrial investment in Tompkins County, given its more education-centered economy. Manufacturing went from 36% of Tompkins County’s employment base in 1960, to 6% in 2010. Even as the number of jobs in the county quadrupled in those 50 years, manufacturer head counts dropped by 50%. But then, for a Northeast manufacturer looking to expand, there aren’t too many recently-built but vacant industrial plants to make convenient reuse of.
Perhaps another selling factor apart from an already-built industrial space is a certain fondness for Tompkins County; Polevoy’s LinkedIn profile indicates he graduated from Cornell in 1975, and the email address on file with the IDA includes a reference to the Finger Lakes.
The Tompkins County IDA will open discussion of the requested tax abatement on Wednesday at 1:30 PM (video link here). Review will continue into next month’s meeting, and comments can be submitted to Ithaca Area Economic Development’s Ina Arthur at email@example.com.