Performance Food Group is moving its food distribution plant from Santa Cruz to Gilroy.
The company said it will build a 195,000-square-foot food processing plant on Monterey Road, which will replace its current location in Santa Cruz.
The move could mean nearly 60 new jobs in Gilroy, as the company expects to retain 70 percent of the current 190 person workforce. However, it is unclear how the commute will affect the retention of long-term employee.
The new site sits on 30 acres of land at 5480 Monterey Road, south of the Garlic Farm Travel Center. Construction is expected to take about a year.
With 30 acres to work with, Performance Food Group will have the option to add 151,000 square feet to the 195,000 square feet facility. The property was listed by Renz and Renz Investment and Commercial Brokerage at $5,500,000.
While Performance Food Groups, which specializes in supplying restaurants, may be one of the largest industrial food distribution operations in Gilroy, it is expected to employ fewer employees and will take up a smaller land-use footprint than UNFI, the largest distributor of organic and natural food products in the US, which employs 230 employees.
Performance Food Group distributes a broad array of food and food-related products such as baked goods, meats, poultry, condiments and even cleaning supplies. The firm delivers fresh, frozen and dry food as well as food-related products such as cleaning supplies and packaging materials. It also offers equipment, supplies and serving ware.
The company has a cheese processing facility in Minnesota, and also ships fresh seafood overnight to customer locations across the U.S.
When the decision to approve construction of UNFI was presented to the Gilroy City Council, the Gilroy Economic Development Corporation requested that they submit financial information into IMPLAN, a software program used to calculate economic impacts of new developments. Over the three years, a year-and-a-half of construction and a year-and-a-half in operations, IMPLAN estimated that UNFI would generate approximately $142 million in economic impact.
Included in the IMPLAN estimation are the direct costs of the project, the amount of money that goes directly into the project, including labor cost, real estate, and construction material, but also the indirect economic impacts, including local businesses like restaurants and hotels.
IMPLAN estimated the economic benefit to local businesses, and the companies that supply them would potentially total approximately $60 million.
Performance Food Group, formally Ledyard, has been in its current Santa Cruz location at 1005 17th Avenue since 1957 when Harry Ledyard founded the company. The company was sold in 2011 by former owner Richard Fontana of Scotts Valley to Performance Food Group, headquartered in Richmond Virginia, for $100 million, according to the Santa Cruz Sentinel.