Apr 7, 2007

Hunts Point Terminal Merchants Look to Remodel Market

Plans are being made to modernize Hunts Point Terminal Market, that place in upper New York City where some $2 billion worth of fresh fruits and vegetables changes hands every year.

The 55 merchants who do business there in The Bronx play middleman between the farmers who grow produce along the East Coast and the grocers who serve 20 million people living within a 50-mile radius of the city. Actually, it’s even bigger than that; the facilities handle produce that comes in by truck, rail, ship and air from 49 states and 55 foreign countries.

In mid-August, 47 farmer visitors toured the 125-acre facility and then sat listening in the Hunts Point boardroom as its managers described their desire for a more modern trading site. The farmers were on a summer tour organized by the North American Strawberry Growers Association and built around the theme, “Farming on the urban fringe.”

Built in 1967, Hunts Point Terminal is short on elbowroom to handle today’s longer trucks, short on storage, especially short on refrigerated storage, short on display space, short on repacking space ¬and short on the $400 million it will cost to remodel.

Hunts Point (technically known as the New York City Produce Market) was once located on the south end of Manhattan Island, near where the World Trade Center towers stood. In 1967, the city moved it north 12 miles, across the Harlem River to The Bronx. Since then, it has become the largest wholesale produce market of its type in the world. About 7,500 produce trucks enter the market each month.

It receives about 210 million cartons of fruits and vegetables every year. The terminal has 1 million square feet of interior market space. While 18-wheelers continue to deliver the majority of fresh product, the facility has nine miles of railroad tracks and parking for 1,200 rail cars and 600 piggyback trailers. The complex receives about 200 rail cars per month.

With space short, some produce is stored on refrigerated trucks that have to be jockeyed around as rail cars arrive.

Hunts Point not only receives produce shipments, its wholesalers ship product north to Canada, south to Florida and west to Chicago. They export produce to Europe and the Caribbean.

The strawberry growers listened as Myra Gordon, the executive administrative director; Ira Cohen, once one of the 55 business owners and now a consultant with A & J Produce; and Stephen Katzman, a co-president of the terminal market and president of Katzman Berry Corp., one of the 55 co-op members and a specialist in berries, described their hopes for the future.

New York City has a one-of-a-kind business climate, Katzman said. Not only does it have more than 8 million people, it doesn’t have large supermarkets or box stores like Wal-Marts or Costcos. Space is at a premium. People live in small apartments with small refrigerators and without storage. They shop almost daily.

“The city is dependent on the independent green grocer,” Katzman said.

An estimated 2,500 Korean green grocers have carved marketing niches in the city. That’s an ideal atmosphere for a wholesale produce market like Hunts Point, where these grocers come to get their produce, Katzman said.

Like other things in New York, getting the market remodeled won’t be easy. The market is operated as a cooperative of the 55 merchants, who organize the market’s infrastructure. But they don’t own the land or the facilities. The city does.

Gordon said the cooperative members have offered to put up $150 million over 30 years for remodeling and want the city to put up $150 million as the landlord’s share. Another $100 million is being sought from the state and federal governments. The time frame for remodeling is six years, while operations continue.

The market now employs some 10,000 people and would employ 500 to 1,000 more if properly expanded, Katzman said. The co-op wants to double its size.

The market now is organized in four long rows of buildings with loading platforms on both sides. To gain some space, the plan calls for reducing the four rows to three. Now, produce is displayed close to the unloading areas. Behind that is refrigerated cold storage and other space ¬¬– such as ripening rooms for bananas.

There are pallets of produce everywhere, some containing product coming off the trucks and some mixed pallets of produce ordered by grocers, shrink-wrapped and awaiting shipment. Electric-powered hand trucks move pallets up and down the docks. The minimum order size is a case.

One set of improvements has already been made. Entry to the site is strictly controlled, with an electronic, toll-booth-like entry gate. Identity tags are issued to employees and those who routinely do business there, and day passes are available for more infrequent visitors. Security is tight.

Trucks arriving with produce pay an admission fee, and these manifest charges are used to pay staff and run the overall market. Individual merchants maintain their own areas and hire their own employees.