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A need for space: incubating food businesses

Brooklyn’s growing sector of small food makers has meant more jobs for the local economy over the past few years. As part of this growth, Brooklyn itself has become a brand for artisanal food makers who have set up in small kitchens and incubator spaces across the borough to make their tasty creations. To say that the Brooklyn brand is hot is an understatement.

In December, we at the Brooklyn Chamber of Commerce highlighted this growth. The so-called Brooklyn “Food Chain” – starting with the food manufacturing and wholesale distribution, and including grocery stores, specialty stores, restaurants, and coffee shops – account for 12.5 percent of the borough’s 472,000 private-sector jobs.

According to the Brooklyn Chamber’s Winter 2012 Brooklyn Labor Market Review, food accounts for one out of six of the 49,000 businesses in Brooklyn – with nearly 59,000 people employed by 7,800 businesses. In 2011, Brooklyn’s food manufacturing sector had an estimated annual total output of $2.2 billion. If you consider the borough’s food manufacturing as a single sector, its 2011 job numbers were surpassed only by the health care industry.

The “Food Chain” tops the 51,000 jobs in social assistance and the 44,000 jobs in non-food retail stores. Total wages in the Brooklyn food chain sector came to $1.46 billion in 2011. These are amazing numbers, especially at a time when the national economy struggles and unemployment continues to be a problem.

However, some of these food artisans have become a victim of their own success. Many are struggling to grow by hiring more employees without moving part of their business out of Brooklyn. In my role as head of the Brooklyn Chamber, I have made it one of my priorities to solve this growing problem. Only when more industrial space is made available to manufacturers can these mom-and-pop business blossom and new ones get started.

I have seen that one of the greatest needs for these manufacturers is a co-packing facility – a facility that handles the packaging needs of several small food companies. Again, any co-packer who sets up shop in Brooklyn needs a place to do so.

What our partners in government need to do, on both the city and state level, is make more space available by helping convert existing spaces that are underutilized. The creation of more incubators – like what was done years ago in DUMBO for the budding tech community – will go a long way in helping manufacturers.

With that in mind, we are doing our part to help! The Chamber’s premier food event, Brooklyn Eats, will return on June 26 at the former Pfizer plant in South Williamsburg. By rebranding this previously restaurant-focused event as a new spotlight on these food makers, we will ultimately give them increased exposure to consumers, help create jobs and continue to make Brooklyn the food capitol of the country. The all-day trade show will include fun events, celebrity chefs and a kick-off panel, culminating with a foodie extravaganza – all done in unique Brooklyn style!

In February, the Chamber teamed up with Councilman Stephen Levin to hold a forum with food makers in Williamsburg to discuss the issue. The results, as reported in Crain’s New York Business, was that nearly two-thirds of the roughly 40 Brooklyn artisanal food makers surveyed last year said they were looking for places to set up larger facilities. Of those, 77 percent said they were unable to find it, thus forcing them to move their operations to Long Island City or out of state in search of larger and cheaper spaces.

In the meantime, these small businesses share restaurant kitchens in order to make their products. It’s not the best solution, but it is a way to continue working while searching for larger spaces in Brooklyn that are affordable. We all know that real estate in New York, be it residential or commercial, comes at a premium. But for these businesses to thrive, we all need to ensure that there is space for them right here in Brooklyn where it is also affordable to do business. In terms of economic development, we should nurture these young entrepreneurs – not drive them away. Just like affordable housing is needed for the middle class, affordable industrial space is needed for young entrepreneurs.

Incubators have worked very well in helping grow these businesses. What we need now are more start-ups.

For example, the vacancy rate citywide for industrial space is about four percent. Even though industrial space within Brooklyn – such as the former Pfizer factory, the Navy Yard and Industry City – have been made available over the past few years, there is a need for more real estate to be dedicated to this community.

The lack of reasonably prized space – and space in general – will ultimately drive these businesses away. That’s something Brooklyn can’t afford.

Photo courtesy of Carlo Scissura.

Carlo A. Scissura is the President & CEO of the Brooklyn Chamber of Commerce. For more information on the Brooklyn Chamber of Commerce, visit www.ibrooklyn.com or call (718) 875-1000.  

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