Eli’s Cheesecake Co. broke ground Tuesday on a $9.5 million expansion of its Northwest Side production facility that will give the iconic Chicago cheesecake-maker space to grow as it builds back from the COVID-19 pandemic.

President Marc Schulman, son of the late legendary Eli Schulman, said the expansion will give the family-owned company some much-needed breathing room.

“Things were starting to get very tight here,” he said. Eli’s has made cheesecakes at the facility in the Dunning neighborhood since 1996. But the company has grown since then, adding new products and a gluten-free kitchen. The additional space will allow Eli’s to say yes to additional growth opportunities down the line, Schulman said. The expansion is the company’s first since the 1990s.

Construction at the facility, located at 6701 W. Forest Preserve Drive, is expected to be completed in the first quarter of next year, Schulman said. The 42,000-square-foot addition will bring the production facility up to 104,000 square feet, which will include Eli’s corporate offices as well as the Eli’s Cheesecake Bakery Cafe.

The company has mulled an expansion for many years, Schulman said.

Despite an “exceptionally dire” start to the pandemic, when a wave of order cancellations brought business to a standstill, about 90% of Eli’s employees were back at work within about four months, Schulman said.

Diversification allowed the company to keep going as the pandemic continued, Schulman said; in particular, Eli’s saw the share of its mail-order business grow to as high as about 10%. Chicago’s central location made it easier to ship frozen cheesecakes around the country than if Eli’s had been based on either coast, he said.

Eli’s has continued to rebound, hiring about 80 people over the last six months. The company is on track to surpass the number of jobs needed to meet employment targets associated with tax incentives it received for the project, which require Eli’s to grow from 225 to 300 employees over two years. “We’ll definitely exceed that,” Schulman said. All Eli’s employees are based in Chicago.

Incentives include a $203,250 tax credit from the state’s Economic Development for a Growing Economy program and a Class 6(b) property tax incentive from the city.

More than 50 of the company’s most recent hires have been refugees from Afghanistan, the company said in a news release. Eli’s has long emphasized employing refugees.

The Chicago-style cheesecakes — dense and creamy, baked on a butter cookie crust — were served exclusively at Eli Schulman’s restaurant, Eli’s The Place for Steak, until 1980, when the cakes made a smashing success at the first Taste of Chicago.

These days, Schulman estimates about 60% of Eli’s business comes from the food service sector, including partnerships with airlines such as United and American and chain restaurants including Culver’s, which Eli’s partnered with around the beginning of the pandemic. The rest of the cheesecake business comes from retail sales, including at grocery stores such as Jewel-Osco and Mariano’s, and mail orders.

Schulman said he’s grateful the company has remained family-owned with a focus on quality through its growth and success.

“Just because we make more is no excuse to compromise quality at all,” Schulman said. “It’s real people making cakes.”

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