Wal-Mart Backs Out on Wallkill Distribution Project

"Wal-Mart has increased the efficiency of our existing distribution network," says Rollin Ford, executive vice president of Logistics and Supply Chain for Wal-Mart. "This allows us to effectively service our stores without the expense of this distribution center."

Orange County executive Edward A. Diana says, "Wal-Mart's decision not to build their regional distribution facility in the Town of Wallkill is a great loss for the town and the County of Orange. Orange County's economic development team went above and beyond to make sure Wal-Mart had the resources necessary to build in Wallkill. It is extremely unfortunate that Wal-Mart's corporate offices made this business decision so late in the process."

"I find it unbelievable that 10 days before breaking ground they find new technology," says Richard O'Beirne, executive director of the Construction Contractors Association of the Hudson Valley Inc. "I don't think are being candid with us."

O'Beirne says that although the building project had been estimated at about $48.5 million, the entire development in turn-key condition would have cost about $100 million to complete. He noted that site preparation for the 1.2-million-sf facility was projected at somewhere between $30 million to $35 million.

"I just think Wal-Mart was surprised by the amount of site work there was," O'Beirne adds. Project estimates had as many as 600 construction jobs created to build the distribution center, with about 700 workers initially hired to operate the facility upon completion.

Wal-Mart originally announced plans to build the project at a press conference led by New York Gov. George Pataki on July 31, 2002. However, in May 2003, just before it was to break ground, the company stated it had put the project on hold. In December 2003, the retailer gave the project the green light for a May 2004 groundbreaking.

"There's no doubt that we are disappointed that Wal-Mart won't be landing here," points out Orange County Partnership president Maureen Halahan. "However, we know that other companies will continue to find Orange County the best location for their business needs."

Orange County officials say they will continue to market the site to potential users and will also work with Wal-Mart to make sure the property is placed on the tax rolls. Officials note that at present in excess of 27 companies, representing more than 4,000 potential jobs, are looking at locating or expanding in Orange County.