By Joshua Burd
An industrial linen business is poised to double its footprint in Irvington and upgrade its space in Trenton, following the approval of nearly $38 million in state tax credits over 10 years.
The firm, CleanTex Services Inc., was awarded the incentive package on Tuesday during the Economic Development Authority’s monthly board meeting. The company has told the EDA it would use the Grow New Jersey incentive to expand in the state and create more than 350 new jobs, rather than consolidate its operations and move to Philadelphia.
Those expansion plans include vacating and selling its existing 40,000-square-foot production plant in Irvington and moving to a more efficient, 96,000-square-foot space at 669 South 21st St. in the township. According to the EDA, CleanTex would sign a 20-year lease at the new facility with Brookview Real Estate Group, with one seven-year option.
CleanTex would also upgrade an existing 39,000-square-foot plant in Trenton with better, newer technology and equipment, the EDA said. The proposed new terms would be a long-term lease with 330 Pennington LLC, the landlord, for a 15-year lease with one five-year option and one seven-year option to extend the lease.
The company, which provides linen and laundry services, has told the state it would add extra shifts in order to increase the number of employees at the facility without increasing its footprint.
“Today’s approval for CleanTex demonstrates the ability of the Grow NJ program to assist businesses of all sizes,” said Melissa Orsen, the authority’s CEO. “CleanTex’s continued success in New Jersey is a testament to the ability of family-owned businesses to thrive in the state, and we are thrilled to offer support to help nurture this growing enterprise.”
Headquartered in Linden, CleanTex was founded in 1995 and also has operations in Brooklyn. The company said it has outgrown both the Irvington and Trenton facilities and is looking to incorporate the latest material handling systems and larger washer, dryer and folding systems now available.
Its application to the EDA calls for creating more than 200 new jobs in Irvington, where it would also retain 82 jobs at risk of leaving the state, while adding 152 new jobs and retaining another 166 positions in Trenton. The EDA said the total private investment associated with the two facilities is expected to exceed $14.8 million.
CleanTex said the upgrades will better position the firm to serve its hundreds of corporate, hospital and extended care customers throughout New Jersey, New York, Connecticut and Pennsylvania. For the state, the move is projected to have a net benefit of $3.8 million over 20 years.
“Since CleanTex was founded in 1995, New Jersey has proven to be a strategic location in terms of both logistics and hiring appropriately skilled workers,” CleanTex CEO Jacob Zahler said. “Today’s approval of Grow NJ tax credits will make our expansion in New Jersey a more viable option.
“CleanTex is dedicated to the communities where its plants are located and pleased that with the help of the EDA, it cannot only remain, but also grow in Trenton and Irvington.”
Lee Winter of WRE Consulting, which advised CleanTex, said Grow New Jersey “was the critical factor” for the company in the Garden State.
“(Incentives) are playing a central role in making real estate deals happen,” Winter said. “In the past, economic incentives served as a tiebreaker,” he added, but due to more powerful incentives and escalating real estate costs, “incentives are now the straw that stirs the drink.”
In a news release, the EDA noted that Trenton is one of five municipalities designated as a Garden State Growth Zone under the Economic Opportunity Act of 2013, providing those communities with additional incentives in order to spur private investment and employment growth. Irvington also qualifies for enhanced incentives due to its designation as “distressed municipality” under the legislation.