Macy’s $29.9 Million Project Seen as ‘Big Win’

NORTH JACKSON – Economic development leaders say they are thrilled with  Macy’s Inc.’s decision to place a new $29.9 million fulfillment center in North Jackson. 

The project announcement came Feb. 24 in a joint news release from Team NEO, JobsOhio and the Youngstown/Warren Regional Chamber.

The site will be operated by Macy’s Corporate Services LLC.

Renovations to the existing building on Bailey Road will begin in mid-March with completion expected in September, said Andrea Schwartz, Macy’s senior director of media relations. About 400,000 of the building’s 600,000 square feet will be reworked to house the new operation.

“Our experience in 2020 increases our conviction to take bolder actions to drive our business forward as a digitally led omnichannel retailer,” Schwartz said. “We have shifted a large proportion of our current and future capital to digital, supply chain and technology platforms to better integrate our digital and physical assets and deliver the most relevant shopping experiences. Macy’s Bailey Road distribution center is an example of our investment.”

The building currently handles store delivery –sending merchandise to stores to stock their floors for customers to make purchases in person – and delivers furniture and mattresses directly to customers’ homes after they place an order either in-store or online. After the expansion, the center will stock home merchandise and fulfill digital orders for the Macy’s and Bloomingdale’s chains nationwide.

“It’s a big win,” said Walt Good, managing director of projects for Team NEO. “It solidifies that footprint in the Macy’s portfolio of operations.”

Jackson Township Trustee Tom Frost similarly welcomed the news. “It’s great for the Mahoning Valley to get that many jobs,” he said. “They’ve been a good neighbor, and we’re glad they decided to continue to invest in their facility.”

The project announcement followed the approval Feb. 22 by the Ohio Tax Credit Authority of an eight-year, 1.472% Job Creation Tax Credit to support the expansion.

The estimated value of the tax credit, contingent on jobs and payroll generated, is $1,855,000, said Lisa Colbert, public information officer for the Ohio Development Services Agency. The project is expected to add $16,775,000 in new payroll and retain $2,100,000 in existing payroll.

The tax credit agreement calls for adding 417 jobs and retaining 55 positions at the site by Dec. 31, 2023. It requires Macy’s to maintain operations at the project location for at least 11 years.

Decision-makers at the New York-based retailer evaluated other distribution and logistics centers in West Virginia and Illinois for the expansion, but ultimately decided to leverage the “logistical excellence and access to skilled employees” in North Jackson, the company said.

“Macy’s Bailey Road distribution center has been selected as a new customer fulfillment location to support our growing digital business,” said Macy’s Inc. chief supply officer, Dennis Mullahy. “We are delighted to retain our current employees and hire more than 400 people in the community to support this work.”

“The Macy’s distribution center has long been a vital part of our business community and we are extremely pleased that the company has selected Mahoning County,” said Sarah Boyarko, chief operating officer at the Youngstown/Warren Regional Chamber.

The project came together relatively quickly, according to local and regional development officials. Macy’s officials began working with Team NEO in mid-December, according to Good.    

“This was, in comparison to other projects, very fast moving. But Macy’s had been analyzing this for some time, and they had opportunities at existing facilities,” he said.

Once Macy’s officials completed their internal analysis, they reached out to begin discussions regarding what kinds of support might be available for the North Jackson site, as they were doing for the other locations under consideration, he said.

The Regional Chamber became involved around the same time, said Shea MacMillan, its director of economic development projects.

Several companies, including large industrial firms, want to take advantage of the access that North Jackson provides to the Ohio Turnpike, MacMillan said.

“Macy’s selection of the Lordstown area is a testament to the opportunity in this part of the region,” said Team NEO CEO Bill Koehler. “The North Jackson/Lordstown corridor has witnessed impressive announcements in the past several years with seven companies committing to create more than 5,200 new jobs.”

Several national companies such as FedEx and Mom’s Meals have placed and expanded operations in Jackson Township, Frost noted.

“We continue to get people looking at that area and it’s due to our infrastructure and the interstate system, he said. “Our location is second to none when it comes to these logistics companies.”     

Entities involved in the project also included the Western Reserve Port Authority, which is doing a capital lease deal. In January, the port authority approved a resolution authorizing the execution of a term sheet and preliminary agreement with Macy’s, which was not named at the time.

“We would own the building and we would lease it back to them,” said Anthony Trevena, WRPA chief operating officer. The port authority will also provide a sales tax exemption certificate for the purchase of construction materials for the project.

“The success of this project is a testament to the Valley, its workforce, and the efforts of JobsOhio, Team NEO and our economic development partners,” said port authority CEO John Moliterno.

The chamber also connected Macy’s with the Mahoning County office of OhioMeansJobs to take advantage of the locally administered job training program.