Galesi subsidiary to get tax break on $5M Rotterdam warehouse

An aerial view of the Rotterdam Corporate Park.

The Galesi Group is investing $5 million at its Rotterdam Corporate Park to build a 100,000-square-foot warehouse for a subsidiary and will get a tax break on the new building.

David Buicko, chief operating officer of Galesi, said Rotterdam-based Distribution Unlimited is growing and requires the additional space. It now has 55 employees.

“There is a shortage of good new warehousing space,” he said. “They are continually hiring and as they get more business they will add more people.”

The company is one of the largest third-party logistics providers in the Northeast, Buicko said. It provides public warehousing, freezer storage, inventory management and other services.

During a meeting Wednesday evening, the Schenectady County Metroplex Development Authority agreed to hold a public hearing on the proposed development. A date for the hearing has not yet been set.

“This is a new facility that is driven by new demand and the need for newer space to handle certain customers,” said Ray Gillen, chairman of Metroplex. “This is basically retention and helping those people already employed.”

Metroplex will provide a payment in lieu of taxes agreement for the company under which it will pay 100 percent of taxes owed on what is now vacant land and 50 percent of taxes on the building the first year, followed by a 5 percentage-point increase in taxes for 10 years until the building is 100 percent taxable.

Gillen said Metroplex is not providing Galesi with any awards or grants for the project. The Metroplex board plans to grant final approval for the development during its next meeting on Oct. 14.

“The PILOT is one that’s widely accepted and used around the state,” Gillen said. “Right now, it’s a vacant piece of land and will continue to collect 100 percent of taxes. They will pay that.”

The Rotterdam Corporate Park, owned by Galesi, has more than 3.7 million square feet of space and is the largest business park in the Capital Region. Tenants include FedEx Freight, Golub Corp. and Railex.

Also during the Metroplex meeting, the board approved authorizing a contract to demolish blighted buildings on lower State Street to make way for 105 upscale apartments and 9,900 square feet of retail space.

The $20 million project by Highbridge Development of Schenectady and Prime Companies of Cohoes will knock down the Olender Mattress building at 254 State St., a red brick building at 236 State and the BiMor Army Navy building at 232 State.

Gillen said the demolition, with a $675,000 price tag, would begin immediately and construction of the Robinson Block project could start this fall.