Development Company, Cascade Group Jamaica is pumping $2 billion into the construction of a 7000 square meter distribution hub for Nestle Jamaica.

The new construction — strategically located off the Mandela Highway — is the culmination of an eight-year negotiation with Nestlé, which will rent the premise on completion to house its corporate offices and distribution centre.

Construction is slated to begin next week and should be operational by April 2017.

“During many years and still today, our distribution centre was situated in Bogwalk, adjacent to the factory. Historically this made a lot of sense as the major part of our products were manufactured in Bybrook,” Country Manager Jurg Blaser told the audience during the ground-breaking ceremony yesterday.

“Over the last decade, however, our growth was increasingly generated by imported products, and the idea of having a logistic footprint closer to the port and the major consumption centre of the corporate area came up strongly,” he continued.

Blaser added that the additional cost for transporting goods through the Bogwalk Gorge and bringing them back to Kingston, serve customers, together with the space constraints forced the company to lease outside storage, resulting in suboptimal layout for picking and loading.

“Several projects were developed, approved, then rejected for different reasons, but unfortunately never reached beyond the planning status. But as the saying goes, ‘third time’s a charm’, and here we are today to make it a reality,” he said.

Nestlé Jamaica is the first to set up operation in what is being developed into an Industrial Park at the corner of Tom Cringle Drive and Mandela Highway, Kingston. The new development, dubbed Kingston 876, will host a mix of information, communications and technology (ICT), manufacturing and retail companies, according to owner of the property Cascade Group, which was represented by CEO Fredrik Moe.

The development site stretches across 96 acres of land.

“This location has a tremendous amount of benefits to anybody who is going to operate here, and I think Nestlé was very informed and wise in its decision to come here,” president of the Private Sector Organisation of Jamaica (PSOJ) and CEO of the Wisynco Group, William Mahfood, told the audience.

“First of all, you have the port which is less than 15 minutes away; you have access to both highways — EastWest and NorthSouth, which means that from a distribution and logistics point of view, very similar to Wisynco which is just down the road, both companies will have tremendous advantage over many other distribution and consumer goods company because of our location,” he said.

Last year Nestlé Jamaica sold part of its operation to Musson Jamaica Ltd, which also has majority shares in listed-company Seprod Jamaica Ltd. The deal saw Musson acquiring Nestlé’s Betty condensed milk and Supligen food drink brands, as well as the manufacturing and distribution facilities at the Bybrook factory in Bogwalk, St Catherine.

Musson’s acquisition ceased the Swiss-owned company’s manufacturing operations in Jamaica, but Nestlé continues to market, sell and distribute its international brands Milo, Maggi, Nescafé, Nesfruty, Coffee Mate, Nestum, Cerelac, Klim, Carnation and Gloria locally.

The planned distribution centre, a 6000-metre building, will be equipped with the latest material-handling equipment and warehouse management system, including a radio frequency-based inventory management fully integrated with Nestlé’s commercial operational structure, according to Blaser.

The corporate offices will take the form of a two-storey building facing the Mandela Highway.