Arctaris recapitalizes Pennsylvania cold storage facility
Arctaris Impact Investors recently invested $7.3 million in a specialty manufacturing and cold storage facility in Braddock, Pennsylvania, in a move the company says will enable it and real estate partner RDC to re-open and lease the former Fifth Season facility to tenants seeking to bring jobs to the region.
The previous tenant, a vertical farming business, abruptly closed in late 2022, leaving the newly developed facility empty, Arctaris reported. This closure resulted in the loss of over 40 jobs in Braddock, a steel production hub outside Pittsburgh with poverty rates above the county average (30.9% in Braddock vs. 11.1% in Allegheny County). Arctaris and RDC, a Pennsylvania-based developer, intend to renovate and invest in clean refrigerated space to prepare for a new manufacturing tenant. The facility will provide space for tenants looking to use it for food processing, pharma processing, specialty manufacturing, or cold storage. This work fills a need for critical manufacturing facilities that are in short supply due to the steep cost of refrigeration, HVAC, and power requirements.
In addition to the original private investment, Arctaris has committed $7.3 million of new investment that will provide for two phases of work. This investment was made in partnership and partially through a multimillion-dollar commitment from Erie Insurance. Based in Erie, Pa., Erie Insurance invested in the Braddock project as part of a $20.5 million social impact commitment made to fund companies and development projects in underserved communities within the company’s footprint.
“I’m delighted that this collaboration will bring new jobs to Braddock, and I want to congratulate all the partners on this exciting announcement,” Sara Innamorato, Allegheny County executive, said in a news release. “Allegheny County Economic Development’s commitment of $1 million to this facility, on top of an additional $8 million the department has invested in Braddock in the last five years, is a demonstration of our commitment to revitalizing the Mon Valley.”
The first phase will start the renovation of the processing facility, repair of the colling tower, and power supplies and select interior demolition. The second phase of funding will be to match any public investment for the customization of the space for a tenant’s specific manufacturing requirements. Upon occupancy, new tenants are expected to create 50-100 jobs in the region.
“This investment is about bringing continued economic growth to Braddock. The facility will benefit the broader community through more than bricks and mortar; it’s offering hope, jobs, and security for local residents,” said Nihar Sait, Arctaris managing director. “Arctaris is committed to creating positive, sustainable change in underserved communities, and this investment is a powerful step supporting the revitalization of Braddock.”
Shawn Fox, RDC president, also is excited about the possibilities this partnership brings to Braddock and the Mon Valley.
“We’re thrilled that this unique partnership allows us to move forward to restart this amazing facility that can be a key economic driver in Braddock and the Mon Valley,” Fox sad. “Our conversion of this space, while also repairing and preserving the critical infrastructure that cannot be duplicated, fills a demand that food production, pharma production, and specialty manufacturing have an interest in. The investment from private and public sources will be impactful to this community and its economy.
“There is a shortage of food production and cold storage facilities throughout our country that has driven up food costs and limited the amount of locally sourced food. We also recognize that having the ability for local production of pharmaceuticals is critical to our health as a region. This facility can do both and we are so excited about the private public partnership to preserve it.”
