Mondelez International Inc. is making a $122.5 million investment in its operations in eastern Henrico County, reinforcing that its cookie and cracker bakery here is a key strategic facility for the global snack company.
The plant on Laburnum Avenue will get a 68,000-square-foot expansion to house a high-speed production line mostly for its Oreo cookie-making operations. In addition to Oreos, the factory makes popular snack foods such as Ritz and Wheat Thins crackers and Chips Ahoy! and Nilla Wafers cookies.
The company also will open a 490,000-square-foot sales fulfillment and distribution center about 3 miles away — in the first phase of the Sauer Industrial Center at the northeast quadrant of Airport Drive and Pocahontas Parkway. The warehouse is slated to open next year and will create about 80 new jobs.
The investment was announced Thursday afternoon by Gov. Ralph Northam’s office.
The Richmond area has and continues to be an important geographic location for the company’s manufacturing operations, said Mondelez spokesperson Laurie M. Guzzinati.
“This investment is a reflection of the further commitment to Richmond as part of our U.S. manufacturing network to support key brands and priority brands for our business,” she said.
The Henrico plant took on an even more important role for Mondelez this year when the company closed two aging plants in New Jersey and Georgia.
As a result of those closures, the Henrico plant became a strategic geographic site for the company’s operations on the East Coast, Guzzinati said.
The plant already makes Oreo cookies. But Mondelez is in the process of shifting equipment of its key Oreo production from New Jersey to Henrico, meaning that Oreo cookies will be made at two U.S. plants — here and in Portland, Ore.
Construction on the 68,000-square-foot building is nearly completed, but the company will be adding the new equipment to that part of the factory complex over the next year.
The investment adds incremental production to the factory, Guzzinati said.
“This is pretty exciting news,” said Anthony J. Romanello, executive director of the Henrico Economic Development Authority. “They are bullish on Henrico and bullish on Virginia.”
The plant, which opened in 1973, employs about 500 workers, including about 400 unionized employees.
It had been owned by Nabisco and later by Kraft Foods Inc. It is now part of Mondelez, which was created when Kraft Foods split into two companies in 2012.
In 2014, the company invested almost $50 million in the plant to add a state-of-the-art manufacturing line for Ritz crackers and to modernize some other manufacturing assets.
The Virginia Economic Development Partnership worked with the Henrico Economic Development Authority to secure the investment. Northam approved a performance-based grant of $1.8 million from the Virginia Investment Performance Grant, which provides an incentive to encourage capital investment by existing Virginia companies.
The Mondelez distribution center in the Sauer Industrial Center is being developed by Becknell Industrial, an Indianapolis-based developer of warehouse distribution centers across the nation.
Becknell acquired an 83.37-acre parcel for $4.175 million in August for the first phase of the industrial park.
The Sauer Industrial Center has 450 acres about 1 mile south of Richmond International Airport along both sides of Airport Drive near the Pocahontas Parkway. Plans call for about 3.3 million square feet of industrial space when fully built out. The center is being developed by Sauer Properties Inc., the Richmond-based development company that is behind the Whole Foods-anchored Sauer Center project on West Broad Street near the Fan District.
Thursday’s announcement about Mondelez’s investment in Henrico comes two months after the company settled a strike with employees at that plant, two other bakery plants and at three sales distribution centers across the U.S.
Workers had been on strike seeking increased pay, improved benefits and better working conditions. The strike lasted about a month.
“Employees are back and we’re focused on the future at the site and our U.S. network overall,” Guzzinati said.