Aldi Inc., a multinational food company based in Germany, today broke ground on a new regional distribution center in Faribault, paving the way for expansion of the Aldi Foods brand in the upper Midwest. The 515,000 square foot facility is being erected on a recently annexed 110-acre site on the north side of Faribault near the city’s airport. Actual construction on the project will begin next year, with completion slated for October 2007.

The property is included in Faribault’s Job Opportunity Building Zone (JOBZ), part of Minnesota’s tax-free rural economic development program. The company had been considering an alternate distribution site in Hudson, Wisconsin, but the financial incentives offered through JOBZ sealed the deal for Aldi’s expansion in Faribault.

“Without JOBZ, this facility would be in Wisconsin,” said Jesse Anesi, Director of Real Estate for Aldi Inc.

The Faribault distribution center will serve Aldi Foods stores throughout the upper Midwest. At the time of initial startup, the company expects to employ more than 50 people, with an estimated annual payroll of more than $2.5 million. Officials expect total employment to grow to 78, plus as many as 38 independent truck drivers under contract with Aldi.

“This is a big win for Faribault, and a feather in the cap for all of Minnesota,” said Matt Kramer, Commissioner of the Minnesota Department of Employment and Economic Development (DEED). “Aldi is a solid international company with a growing presence and strong brand recognition throughout North America. I’m proud that we were able to attract this important regional distribution hub because of our strategic geographic location, great transportation and infrastructure advantages, and the financial incentives offered through the JOBZ program.”

Aldi Inc. is known for its deeply discounted private-label grocery and general merchandise stores, as well as its up-market brand, Trader Joe’s. Aldi’s first store opened in Essen, Germany, in 1948. After experiencing rapid growth in Europe, the company expanded into the U.S. in 1976, becoming a leader in the international grocery retailing industry. It now has more than 5,000 stores in Europe, the United States and Australia.

In the Twin Cities metro area, the company recently opened four stores under the Aldi Foods brand, and has plans for many more throughout the region. It also has plans to open more Trader Joe’s stores.

The JOBZ initiative is Minnesota’s marquee initiative to stimulate economic development activity in distressed areas of Minnesota. The initiative offers a variety of local and state tax incentives to companies that start up or expand in one of 10 designated regions of Greater Minnesota.

Since the program’s inception in January 2004, 180 companies have executed agreements to invest more than $181 million and create at least 2,575 new jobs.