Penn-Northwest Markets Opportunities in Shenango Valley
SHARON, Pa. — Penn-Northwest Development Corp.’s effort to lure TJX Companies Inc.’s HomeGoods distribution center to Mercer County didn’t succeed, but the effort ended up bearing other fruit.
A venture spinning out of that effort is among the projects Penn-Northwest is engaged with, officials with the development agency report.
Penn-Northwest had pitched the site at Pennsylvania Exit 15 off Interstate 80 to TJX when the company was rethinking its plans to move forward on a proposed $160 million regional distribution center in the village of Lordstown, Ohio, a site the company ultimately chose.
Another developer is purchasing 208 acres at the interchange and the developer intends to outline plans for the property at Penn-Northwest’s annual meeting, says Penn-Northwest CEO Randy Seitz. The dinner meeting is scheduled for Sept. 26 at the Avalon Golf & Country Club in Hermitage, Pa.
Seitz is vague on details but says the developer has “a wide portfolio of clients. The opportunities are endless about what could ultimately end up there.”
Seitz credits national media coverage resulting from Penn-Northwest’s efforts to market the property with attracting the developer’s attention. The development agency is in the process of identifying additional sites to be ready for other development that the project could spur.
“A couple of them are going to be in the New Vernon Township area – that’s an area we’re looking at right now,” he says. “It’s very close to both [Interstates] 79 and 80. Another area that we’re looking at is any land along I-376. With the new cracker facility, there may be opportunities for distribution of these plastic pellets.”
Seitz and Gary Dovey, Penn-Northwest vice president for business development, report deals with other companies are close to completion.
One is with a parts manufacturer that serves the aviation and aerospace industry and has already made two visits to Mercer County, Seitz says.
The Mercer County plant would create as many as 200 jobs, Dovey adds.
Penn-Northwest officials also recently met with a “well-funded” recycling startup that reprocesses items such as tires, breaks them down into their carbon-based components and converts them into jet fuel and diesel fuel, Seitz says.
The company, which needs about 100,000 square feet of space, would initially look to employ about 50 but that number could go to 300 once it is up and running, Dovey says.
“I’d say we’re extremely close on that one,” he says. In fact, both that company and the parts manufacturer are close to completion. “We’re waiting for them to basically sign the deals,” he adds.
Even as Penn-Northwest looks to identify land for businesses that might be supplied by the Shell ethane cracker now under construction in Beaver County, Pa., Seitz reports the project already has helped to lure companies to Mercer County.
Moretto USA, which manufactures equipment used in injection molding, moved into the Jackson Center Industrial Park in 2016.
“We actually identified different sites for them and then we introduced them to the owner of the property where they ended up finally,” Seitz says.
So far Moretto, whose parent is based in Italy, is doing distribution and possibly some assembly here, but “the ultimate plan is that they’ll be manufacturing here,” he says. The company has 12 employees and is preparing to add four more.
Moxietec, a startup in the Instron building in Grove City, is in the research and development phase, Seitz says. The company has developed a new, patent-pending material that can be used to mold lightweight, thick cross-section, injection-molded parts, according to the company website.
Although proximity to the cracker wasn’t a decisive factor, Justin Fowler, one of the partners, says the company is looking forward to it starting up. “It’s great the cracker plant is there, for sure,” he says.
Penn-Northwest met last December with the company’s investors, a group out of New York, and showed them various local opportunities, including in the Keystone Opportunity Zone, Seitz says. When it became apparent the local partners wanted to use an existing building, Penn-Northwest showed several options before introducing Moxietec to Thomas Construction, which made the startup aware of the Grove City property.
Seitz describes Moretto and Moxietec as “dream prospects in economic development” not looking for low-interest loans, grants or other incentives.
“It took very little for them to locate in the community,” he says.
Local development leaders including those at Penn-Northwest also are considering how best to capitalize on the new Opportunity Zones. Mercer County has two census tracks selected for the incentive program, both in the city of Sharon.
The program provides incentives for investment by permitting capital gains to be invested in projects within the zones, deferring taxes on those capital gains.
“There is a huge opportunity here,” Seitz says. “It’s going to take careful thought to identify projects that could potentially have an impact.”
The program has yet to attract much interest from potential investors, in part because the federal government has yet to define all of the criteria and requirements, Seitz says. Opportunity Zones were approved as part of the Tax Cuts and Jobs Act of 2017. The qualifying census tracts were announced in June 2018.
“People are really confused right now about the program and how it works,” Seitz says.
One of Penn-Northwest’s priorities in the next fiscal year will be to “brainstorm” with Sharon city officials and representatives of the Shenango Valley Chamber of Commerce. “The first thing would be to identify the project, identify the cost and then see how we can use the Opportunity Zone to raise the money for the project,” Seitz says.
Pictured above: Greenfield land off Interstate 80 near Mercer, Pa., has attracted a developer.
Copyright 2022 The Business Journal, Youngstown, Ohio.