County officials say they’re going back to the drawing board in their efforts to redevelop a portion of the former IBM campus after a leading contender for a lease at the site, The Farm Bridge, announced they were going out of business.

The new effort will focus on finding a developer with the financial muscle to carry out a major overhaul of some 400,000 square feet of office space on the county-owned parcel known as Enterprise West.

The county’s efforts to redevelop the site took shape last year after it came into possession of the site on the west side of the sprawling ex-IBM Kingston facility following foreclosure proceedings against Alan Ginsberg, who bought it in 1998 and renamed it TechCity. The county transferred the property to the Ulster County Economic Development Alliance, a quasi-public entity which, among other roles, facilitates public-private partnerships between the county and private-sector developers.

In January, the UCEDA issued a “Request for Expressions of Interest” seeking potential tenants for the site. Applicants were offered three “tracks” as part of the outreach effort. They could offer to buy the property outright, enter into a leasing arrangement with the county or offer professional services aimed at redeveloping the site.

The initiative drew 22 responses. Among the proposals was one from Bard College to turn the site into a satellite of their Annandale-on-Hudson campus. Other proposals included a tennis facility, an indoor “vertical farm” and an event space.

But an advisory board tasked with vetting the proposals quickly settled on an entity familiar to UCEDA officials: The Farm Bridge. Since 2015, Farm Bridge has occupied 30,000 square feet of the former IBM commissary kitchen under a leasing arrangement with Ginsberg’s TechCity. The company, which employs 50 people, takes produce from local farms and processes it into an array of prepackaged products for sale in grocery stores and in bulk to institutions.

The company had been working with UCEDA for years, seeking to get out of TechCity where maintenance issues and lease terms had made the operation increasingly untenable. Last summer, the company partnered with powerhouse nonprofit the NoVo Foundation to acquire space at the Hudson Valley Mall. The plan called for NoVo to back the move with a $2.25 million long-term loan while the nonprofit, which operates the Hudson Valley Farm Hub, would build a grain mill to occupy a shared space at the mall. That deal fell through after NoVo and Farm Bridge were unable to reach an agreement with mall owners the Hull Property Group.

In February, Farm Bridge and NoVo submitted an application for the Enterprise West site as part of a consortium that would also include the arts collective BLUEprint. Under the proposal, each entity would occupy a portion of the Enterprise West space, with BLUEprint operating a hive of workshops, art studios and event spaces. The Farm Hub would install its grain mill along with a test kitchen and spaces for administrative offices and education. The Farm Bridge, meanwhile, would acquire enough space to allow for an expansion, and the addition of another 25-30 new employees.

Tim Weidemann, who serves as both Ulster County’s director of economic development and president and CEO of UCEDA, said the BLUEprint proposal appeared to be a good fit for the county’s vision for Enterprise West, and the Farm Bridge, Farm Hub and BLUEprint operations were in line with the county’s focus on the food and beverage sector and arts and culture as core industries.

Critically, the BLUEprint proposal also came with a robust funding package that would allow the consortium to move quickly to transform the space. Farm Bridge alone came to the table with some $4.9 million in funds to support the move including the NoVo loan, state and federal grants and equity investment.

“That was very attractive to us as a development corporation that has this great property, but doesn’t have a lot of capital to bring it up to snuff for a tenant,” said Weidemann. “They came with a stack of capital ready to make the improvements there that they would need to take occupancy.”

Bridge collapse

Over the summer, negotiations between the consortium and the county were well underway when it became apparent that a key partner in the effort, Farm Bridge, might not make it to the finish line. Battered by the pandemic and still struggling to make things work at the TechCity space, the packing operation was on the verge of shutting down. By mid-September, company officials were reaching out to other area businesses seeking placements for their employees.

Last week, Farm Bridge CEO Jim Hyland made it official, announcing that the company would cease operations. In a letter to employees, Hyland said that the company had run out of road in its efforts to find a more suitable location.

“The chronicles of our current location are well-documented and we started a search for a new home over three years ago,” Hyland wrote. “Our goal was to stay in Kingston and to build the business from its strong foundation. The Farm Bridge overcame a lot over the last 11 years, but the last 24 months have been daunting. The depth and duration of these continuing challenges have proven too much.”

With the Farm Bridge out, the BLUEprint proposal was no longer feasible, Weidemann said. Meanwhile, a review of the previous submissions of interest showed that none of the applicants had the financial wherewithal to overhaul the space. Instead, Weidemann said, the UCEDA opted to reopen the process of seeking a partner with an emphasis on finding a developer who could make the buildings move-in ready and, in partnership with the county, begin leasing space there.

Working with state economic development officials and the regional Hudson Valley Economic Development Corporation, the county began putting out feelers in a process that, in contrast to the earlier request for proposals, took place largely outside public view. Town of Ulster Supervisor James Quigley III, who sits on the Enterprise West advisory board, said he was unaware of the decision to reopen the process until he received a letter inviting him to resubmit the town’s own application for space at the site.

Opaque process?

County Comptroller March Gallagher, who has worked on issues related to TechCity since her tenure as head of the Ulster County Development Corporation a decade ago, said she too was caught unaware by the decision.

“It was not a transparent process,” said Gallagher, who pushed for county officials to enter foreclosure proceedings on the Enterprise West properties and other parcels on the campus. “I think it would have been better if there had been something in the local papers at least.”

Weidemann said the new effort had attracted three or four viable applicants from developers ready to partner with the county. The UCEDA board is expected to select one proposal in the coming months.

“It’s a more narrow process,” said Weidemann of the change in direction of the redevelopment effort. “Instead of looking for any tenant who might want to lease space, we are looking for development partners that would work with us to raise the capital to make that building available to, for example, those businesses that submitted proposals as part of [the request for expressions of interest.]”