May 30, 2024

Schwan’s Co. has taken a big step toward building its new Asian food production facility in Sioux Falls, closing today on a 142-acre purchase at Foundation Park.

The company’s plan is to begin construction this year on a 700,000-square-foot facility there, in addition to opening a regional office downtown.

Schwan’s, which is a U.S.-based food company and a subsidiary of South Korea-based CJ Foods, initially announced plans in 2021 for the new plant in Sioux Falls, “which is projected to cost hundreds of million dollars and add more than 600 new employees,” the company said in a statement.

The regional office will be downtown but doesn’t have an identified location beyond that, a spokesman said. Initial plans for that office will add “50 high-paying jobs, with the potential to grow up to 100 jobs once the production facility is complete,” the company said. Those positions “will support its continued expansion and operations at the new manufacturing facility.”

The company has worked with the state of South Dakota and city of Sioux Falls to design a state-of-the-art wastewater treatment facility that will be built by Schwan’s on the new manufacturing site.

The wastewater treatment facility will enable the company to discharge water to the city “with the least amount of impact on the city’s current operations,” the company said.

“We thank all state and local officials in South Dakota for helping us make great progress on this project, which will ultimately help us meet the needs of our retail and food service customers,” said CEO Dimitrios Smyrnios, who is retiring this week.

“This project will create significant new production capacity for Schwan’s, enabling us to continue to support our market share-leading bibigo brand and drive future innovation and growth in the Asian food category. I want to personally thank Gov. Kristi Noem and her team for their leadership and commitment to our plans. Without her unwavering support, this project would not be possible. It’s clear to me that the state of South Dakota is open for business.”

In a statement, Noem said: “Schwan’s has recognized the superior business climate that the state offers. I know that their confidence in South Dakota is not misplaced and thank them for the additional investment that they are making.”

The new manufacturing facility will produce Asian-style foods, primarily for Schwan’s top Korean food brand bibigo, using state-of-the-art automated production lines. Production will include a broad range of meals, sides, snacks and appetizers in the shelf-stable and frozen categories. The new manufacturing campus will include a warehouse and distribution center, shipping and receiving docks, and office space.

“Our investment in this world-class, Asian-style food plant in South Dakota will help us strengthen our position in one of the fastest-growing food categories in the United States,” incoming CEO Brian Schiegg said.

“We look forward to continuing our work with state and local officials to build a facility that will benefit the residents of South Dakota, as well as our family of businesses.”

The U.S. market “continues to deliver high growth for CJ Foods, and the ability to continue to scale our portfolio of products to meet the growing consumer demand is vitally important to our strategy,” CJ Foods CEO Minsok Pak said. “This facility will enable us to further accelerate the growth of K-Food and other Asian cuisines. We appreciate the support from local and state officials and look forward to contributing to our new home in South Dakota.”

For Foundation Park, the major projects kick-starts development on the northern portion of the development park, said Bob Mundt, president and CEO of the Sioux Falls Development Foundation.

“It’s our primary tenant up there, and it’s certainly going to sit well with anyone else looking at that particular location,” he said. “For the city of Sioux Falls, this is a major victory for us. Bringing in a company like CJ and that many people that will be employed there, along with the new addition downtown, it’s just fantastic news for Sioux Falls.”

CJ CheilJedang acquired Minnesota-based Schwan’s in 2019 — its subsidiaries that focus on foods sold in retail and grocery channels, as well as food-service venues and Schwan’s manufacturing and logistics operations and various professional and administrative services.

The Schwan family has retained minority ownership in the businesses acquired by CJ Foods. Members of the Schwan family continue to be the sole owner of the legacy home-delivery business launched by Marvin Schwan in 1952, which has been renamed Yelloh.

Schwan’s is the manufacturer of other food brands such as Red Baron, Freschetta, Tony’s Pizza, Mrs. Smith’s, Edwards Desserts and Pagoda.

“Sioux Falls is beyond excited to welcome CJ Foods USA to our community,” Mayor Paul TenHaken said in a statement. “They have discovered what a strong pro-business city and state we are, and I want to thank Gov. Kristi Noem and her team for collaborating with us locally to bring this impactful investment to Foundation Park. This will bring hundreds of quality jobs to Sioux Falls, diversifying our economy further and benefiting the community overall.”

The jobs that will be added at the new Sioux Falls facility will be high value, Mundt agreed.

“I think the plant has been redesigned to be very high-tech, very forward-thinking, very futuristic, and I think the jobs they have will be well received in this community,” he said. ” I think it will take time to scale up to that level, but I think the jobs will be sought-after jobs, and we’re looking forward to helping fill those.”