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Despite economy, API Heat Transfer to grow
Plan expands jobs, space for offices and production

By Jonathan D. Epstein
NEWS BUSINESS REPORTER

 One Western New York manufacturer is bucking slowing economic trends by adding 115 new jobs during the next four years as part of a major project to significantly expand its capacity and capabilities.

API Heat Transfer of Cheektowaga said Wednesday that it will spend $11.15 million to add more than 52,000 square feet of production space and 6,000 square feet of office space at its facility in Cheektowaga.

That’s expected to generate up to 115 new jobs by 2012, boosting the company’s workforce by 25 percent at a time when many employers, including manufacturers, are slashing jobs.

The expansion will enable API to meet growing worldwide demand for its large industrial products, where right now it is hindered by the physical limitations of its buildings. And it allows it to shift some production from a second facility in the Wyoming County village of Arcade, making room for new products to be rolled out there.

The goal is to position the global company to grow its domestic and international market share, as well as expand into new end markets, said Joseph Cordosi, president and CEO of the privately owned firm.

“The work that we’re doing will allow us better penetration of markets that we’re already in and will allow us to penetrate markets that we’re not in,” Cordosi said. “We’re also making a real investment in product development capabilities.”

The company said it received $4.33 million in economic development incentives from the Empire State Development Corp. and county and municipal agencies, and has applied for nearly $4 million more.

API makes heat transfer products — which transfer heat from one medium to another — and also supplies complete thermal process systems used in compressors, refrigerant air dryers, power generation, chemical and petrochemical processing, food and beverage processing, HVAC, de-alcoholization, hydraulic oil cooling and cooling packages for diesel engines.

Besides the plants in Cheektowaga and Arcade, the company has manufacturing facilities in Germany and China. It employs 900 people worldwide, including 467 in Western New York.

The 60-year-old company is owned by private-equity firm Industrial Growth Partners of San Francisco, and last year posted $180 million in sales. Competition includes ITT Heat Transfer, also in Cheektowaga.

API has already broadened its products over the past five years, resulting in “pretty robust growth,” Cordosi said, with sales up 44 percent over three years. But two product lines are being “throttled by capacity” because the Cheektowaga and Arcade buildings can’t accommodate the size of equipment it now needs to build, or the number of individual pieces.

Plans call for adding the space in Cheektowaga to handle the added volume and size in its Basco line, as well as moving its heavy-duty Schmidt plate frame operation from Arcade. Arcade will now be primarily for the light-weight Air- Tech business.

The company also will increase its product development staff and create research laboratory space inside the factory.

Officials broke ground on Sept. 29, using Krog Construction, and work is expected to be completed in early 2009. The company has already added 20 employees locally this year, and expects to add another 90 production workers and 25 professional staff, including product development engineers, application engineers, sales engineers and support staff.

Cordosi acknowledged that officials considered whether to expand now, given the economic turmoil. “You can’t look at the current economic environment and not give pause to a project like this,” he said.

API also considered doing its project elsewhere, but Cordosi cited the state aid for keeping it here.

“Without the support we have been able to get from the local and state government, we would not have been able to do the project in Western New York,” he said. “It would not have been viable.”

jepstein@buffnews.com