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Hospital Central Services Breaks Ground on $10.5 Million Expansion

By Colin McEvoy on March 31, 2015

Dan Marcante, HCSC vice president and COO, scoops the first shovelful of dirt at the groundbreaking ceremony.

Dan Marcante, HCSC vice president and COO, scoops the first shovelful of dirt at the groundbreaking ceremony, as LVEDC President and CEO Don Cunningham and HCSC President and CEO Peter Castagna (right) look on.

They’ve been in the Lehigh Valley for nearly five decades, and thanks to a $10.5 million expansion project, they’ll be in a position to stay here for decades more to come.

Hospital Central Services Inc. (HCSC), an industrial laundry processing and linen service company, held a groundbreaking ceremony Tuesday afternoon for a 21,000 square-foot addition to its Allentown facility at 2171 28th Street.

The project, which received financing support from the Lehigh Valley Economic Development Corporation (LVEDC), will allow the company to create 38 jobs and retain its existing 180 jobs. It is projected to be completed in the fourth quarter of 2015.

“Staying here in the Lehigh Valley is critical for us,” said Peter Castagna Jr., HCSC president and CEO. “This company has always been based here, its roots are here, and to continue that and to expand our business base here really means a lot to us.”

LVEDC helped HCSC procure a $2.25 million Pennsylvania Industrial Development Authority (PIDA) loan for the expansion project, which will allow the company to increase its production capacity, reduce energy consumption and modernize plant operations.

“At LVEDC, our mission is to not only recruit companies into the economy of the Lehigh Valley, but also to help keep existing companies here, to keep them growing, and provide them access to capital so they can prosper here,” said Don Cunningham, LVEDC president and CEO. “We thank all of you for your commitment to be here, to remain here and to invest in your employees and the economy.”

Founded in 1968, HCSC serves about 130 acute care hospitals and more than 400 total health care facilities. That includes all the region’s local hospital systems, including the Lehigh Valley Health Network, St. Luke’s University Health Network, Sacred Heart Hospital in Allentown and Easton Hospital.

The company had considered leaving its Allentown location due to the costs associated with the upgrades, but ultimately did not do so thanks to collaboration between HCSC, LVEDC, the city of Allentown and Pennsylvania’s Governor’s Action Team, according to company officials.

“It’s nice to work with an organization like LVEDC that not only represents the area so well, but also does work that is beyond just helping us secure a loan,” Castagna said. “They really got us connected through their contacts and helped us understand all the value of staying in the Lehigh Valley.”

HCSC was awarded Business Expansion Project of the Year during the LVEDC 2015 Annual Investors Meeting and Awards ceremony on March 18. Cunningham noted that, while new business attraction projects generate the most headlines, 69 percent of the Lehigh Valley’s new jobs over the last five years have come from existing companies and start-ups.

Stormwater retention work has already begun, and construction on the foundation and structure of the new expansion is expected to begin in May, Castagna said. New equipment — which include a new overhead rail system, automated material handling systems and new tunnel washers and dryers — is expected to be delivered by August.

The need for financing assistance was identified after LVEDC conducted a site visit at HCSC through its Business Outreach Program (BOP), which uses a customer-oriented approach to economic development designed to link Lehigh Valley businesses to resources throughout the community that will help their business become more profitable.

The Allentown facility will remain open as the construction progresses. Laundry production capacity will increase from about 25 million pounds per year to between 40 million and 45 million pounds per year.

Serfass Construction Co. Inc. is supervising the construction management, and Barry Isett & Associates Inc. has been retained as project engineer.

Below is a video LVEDC previously produced about HCSC and its expansion project:

Below is a video acceptance speech Castagna recorded for the LVEDC Annual Investors Meeting and Awards ceremony:

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