A new deal is expected to bring hundreds of jobs to Manchester.
Ahold Dehaizes, grocery chain Stop & Shop’s European parent company, is changing the way groceries are distributed to its stores. The company is adding new distribution centers to its supply chain to improve speed to shelf and product availability. The $480 million investment includes the 15-year lease of about a million square feet of warehouse space in Manchester.
“What I understand is it’s going to be the largest leased on the East coast as far as distribution centers,” said Manchester Mayor Jay Moran (D). “It’ll be probably the second largest private employer behind ECHN and the hospital.”
The two-million square foot facility it's moving into was once fully occupied by JC Penney, has sat mostly empty for a year and a half. JC Penney still uses a small portion of the property. Once it's up and running, all dry groceries and non-perishables will come from the Manchester facility. Fresh food like produce will still come from the company's Massachusetts warehouse, according to a spokesperson.
The warehouse will also distribute to New York and our neighbors to the north.
“I think a lot of it just has to do with location. You have such easy access to I-84, to I-91,” said Joe Brennan, Connecticut Business and Industry Association president.
The company plans to acquire the property in April and will spend most of 2020 renovating it for its needs.
The facility is one of seven Ahold Dehaizes is adding as it begins a new self-distribution model, bringing its total number of warehouses to 22. The goal is to cut down on the time their trucks travel to their stores. The company said it will cut down on truck travel by a million miles a year and save a million dollars annually once all of the distribution centers are up in running in three years.
Executive Vice President of Retail Business Services Chris Lewis said that savings would be passed onto the brands it distributes. Because each brand controls its own prices, it will be up to each brand to decide whether to pass that savings onto customers.
Moran expressed excitement over the prospect of adding to the local workforce and the domino effect it could have on the town.
“You’ve got 500-700 employees coming to the area on a daily basis they need a place to eat, they need a place to shop, and so it’s going to be great for Manchester.”
Lewis told NBC Connecticut that the company researched the workforce in the area and believes the market is strong. Lewis said a majority of the jobs will be production labor to fill orders along with forklift operators, supervisors, and inventory control.
Being situated near an already congested area near the Shoppes at Buckland Hills means there could be traffic troubles once the facility is fully functional.
“It’s going to be congested. We’ll worry about the congestion later, we’ll see if that’s a problem but right now we’re excited that that empty building will be filled,” said Moran.
Moran said the state has been studying the traffic issues around the mall to determine whether upgrades are necessary.
Lewis said the company is keeping tabs on the toll conversation going on in the state, but is moving ahead with its plans regardless of whether Connecticut decides to toll trucks.