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A look inside Gotham Greens’s new high-tech indoor farming operation in Northern California

As world population increases, so does the need to find more efficient ways to increase the food supply, not to mention having to cope with extreme and unpredictable weather, drought and groundwater depletion, wildfires and a gradual decline in per capita arable land available for agriculture.

Commercial indoor farming began to emerge a few decades ago as a better way to manage vegetable growth using methods and optimized hydroponic plant feeding techniques that increase the number of annual growing cycles, according to Viraj Puri, CEO of Gotham Greens, a privately held certified B-corporation based in New York City known for its sustainable and environmentally conscious brands.

The company’s newest indoor farming greenhouse near Davis in Yolo County was completed in November 2021 and officially opened on Dec. 8. This location is close to the UC Davis campus. Gotham Greens is partnering with the university to bring more Ag-businesses to the region and to allow its greenhouse to serve as a learning center benefiting faculty as well as students studying indoor farming.

Puri, together with co-founder and Chief Financial Officer Eric Haley and Chief Greenhouse Officer Jenn Frymark, comprise the senior management team at the helm of Gotham Greens from the day the company was established in 2009.

20 harvests per year

“Using innovative soilless hydroponics growing methods, we have been able to increase output from one harvest per month to 20 harvests per year resulting higher yields as well as the ability to grow produce in all types of climate zones 365 days a year regardless of outdoor temperatures,” Puri said.

Demand for vegetables is high. The total market for salad and leafy greens in the U.S. and Canada is approximately $15 billion, according to the Nielsen’s Feb. 20, 2021, report on U.S. extended all outlet combined (xAOC) dollar sales of lettuce and pre-packaged salads.

While indoor farming currently represents a small portion of the salad/leafy greens market, Puri said Gotham Greens is growing by more than 71% annually and the indoor farming sector is growing by more than 50% year over year, far outpacing growth in the overall category (16%) as well as the organic segment (19%). When asked, the company was not willing to reveal the dollar value of its produce sold annually or revenue from sales.

From rooftops to open land

Gotham Greens built its first greenhouse in Greenpoint, Brooklyn, in May 2011 — which the company believes was the first commercial urban rooftop greenhouse — and the second above a Whole Foods Market in Gowanus, Brooklyn.

The rooftop configuration model was replicated at two additional company locations in Chicago, Illinois, and on a former roof of an Ideal Toy Factory in Jamaica, Queens (NYC), as a way to save square footage in cities and to increase proximity to retail grocers.

The company’s fifth through eighth greenhouses were built on open land in Chicago; Edgemere, Maryland; Providence, Rhode Island and Aurora, Colorado — with the ninth greenhouse built on a 10-acre parcel near the UC Davis campus just off Interstate 80 in Solano County.

By shifting to a location strategy involving larger land parcels outside or adjacent to major cities, Gotham Greens can build larger greenhouses achieving greater yields to also serve surrounding population centers.

These sites serve as distribution hubs for delivering produce to cities and towns in the region. Puri said the company plans to continue using this hub-and-spoke model in the future when establishing its presence near other U.S. cities.

The Davis greenhouse serves local produce retailers and those throughout the state. Having nearby delivery destinations also reduce transportation and fuel expenses. This formula also reduces time to market and can extend average shelf-life freshness of its produce to three weeks, or even longer, if distances to retailers are shorter, Puri said.

Gotham Greens specializes in producing lettuce, leafy greens and herbs, including lettuce varieties such as butter, California crunch, romaine, green and red leaf along with basil.

The company also markets a branded line of salad dressings and sauces. Gotham Greens R&D group is also considering the of possibility adding microgreens and other items to its product list.

Intelligent greenhouses

Puri said key benefits of indoor farming revolve around having control of the environment, lighting and “fertigation” hydroponics — the process of putting soluble products, such as fertilizers, water amendments and minerals (nitrogen, magnesium, phosphorus, etc.) into an irrigation system to circulate through a soilless base made using coconut coir, rockwool, peat moss or perlite.

This process is scientifically controlled to adjust and monitor the concentration of these nutrients. Water is continuously recycled, filtered and tested to ensure quality and to maintain proper nutrient levels.

Environmental controls

Technological advances continue to drive growth in this market using intelligent greenhouse climate-controlled systems, including robotics, artificial intelligence (AI), as well as computer vision, sensors, monitors, testing systems and controls.

Another innovation involves realizing improved efficiency resulting in lower costs associated with red and blue wavelength LED grow lights used in greenhouses as well as vertical indoor farming configurations built in city high rises, within former warehouses or inside shipping containers.

Enhancing food safety

Indoor farming also helps to avoid issues related to bacterial contamination, insect damage and related concerns that occasionally impact field-grown plants.

“No one is completely immune. Every food producer is susceptible to issues associated with food safety. However, our highly sensitive environmental controls and monitoring systems minimize such risks and enhance our ability to track and trace every produce batch from our indoor farms to retailer shelves,” said Puri.

He said controls are in place at every stage of the production cycle beginning when quality seed is sourced, while raising seedlings in a nursery, when setting small plants out on the horizontal greenhouse platform, while nurturing plants during a less than a month growing period to maturity, followed by harvesting and packing produce for shipment.

Less water and land use

Another factor making indoor farming more desirable is because traditional outdoor agricultural methods use a lot of water. Some 70% of the world’s fresh water, 6 billion pounds of pesticides and 189 tons of chemical fertilizers are used annually for farming, according to the U.S. Department of Agriculture.

Puri said Gotham Greens uses 95% less water, 97% less land, no pesticides and 100% renewable energy.

“Gotham Greens’ greenhouse farms primarily rely on natural sunlight for photosynthesis, which reduces energy costs compared to other models of indoor farming, making our business more energy efficient, sustainable, resulting in higher quality produce,” Puri added.

During winter months, when daylight is shorter, the company also uses supplemental lighting to optimize the total amount of light needed for growth.

“Using advanced growing techniques, we have been able to increase output from a one-acre greenhouse to grow produce typically requiring 35 acres. One head of lettuce grown indoors only needs a gallon of water before harvest compared to 10 gallons per head when grown outdoors.”

He added that given ongoing water shortages in the West, especially in California and Arizona where most U.S. lettuce is grown, indoor farming will play a greater role in the future when it comes to growing produce.

Global indoor farming market

The size of the global indoor farming market was estimated to be $32.2 billion in 2020, which is expected to reach $36.4 billion in 2021, according to Grand View Research, based in San Francisco.

The worldwide indoor farming market is expected to grow at a compounded annual growth rate (CAGR) of 10.9% from 2021 to 2028 — reaching $75.3 billion by 2028, the research firm reported.

The value of produce grown in global indoor markets is estimated to reach $38.7 billion in 2022, with sales increasing at a 9.6% CAGR over the forecast period rising to an expected $96.6 billion by 2032, based on Future Markets Insight research.

Fruit, vegetables and herbs are expected to dominate the indoor farming market through 2028 with a CAGR of 11.5% for this segment. Demand for tomatoes, lettuce, leafy greens, cucumbers and bell and chili peppers are driving overall market segment growth with tomatoes having the largest share, according to Grand View Research.

These productivity improvements cannot come soon enough with the global population estimated to reach 8.5 billion in 2030, 9.7 billion in 2050 and 11.2 billion by 2100, according to a United Nations report.

Vertical farming is trending

While greenhouse indoor farming was the most common type in 2018, with 80% of facilities built with this concept, vertical farming, including stacked and shelf models, is expected to exhibit the fastest CAGR of around 19% over the next 6 years due to the environmentally friendly production methods for fruit and vegetables, as well as high demand for organic food and changing purchase behavior among consumers. The vertical farming market size was valued at $4.34 billion in 2021.

Producing more food using less real estate is vital because the world is gradually running out of arable land suitable for agriculture.

Overall arable land per capita worldwide declined from 0.197 hectares in 2013 to 0.192 hectares in 2016 due to land degradation leading farmers to adopt new solutions to produce fresh food, according to the World Bank Group. A hectare is approximately 2.47 acres.

Partnership with University of California

Gabriel Youtsey, chief innovation officer with the University of California Division of Agriculture and Natural Resources, said the division and the UC Davis College of Agriculture and Environmental Sciences have worked closely with Gotham Greens from an early point in the company’s search for land.

“We had an opportunity to assist Viraj Puri in finding connections he needed to select a greenhouse site, resulting in the sale of 10 acres on the UC Davis campus to Gotham Greens,” Youtsey said. “From the beginning we formed a partnership with the goal to attract more businesses to become part of the local Ag-tech ecosystem. We also want to support students in the Department of Plant Sciences wishing to learn more about greenhouse operations and advance their knowledge of the latest indoor farming techniques through hands-on workshops, internships and related career exploration activities.”

Gotham Greens Chief Greenhouse Officer Jenn Frymark recently conducted a tour of the new facility for faculty, students and local community business leaders. This greenhouse facility will foster research and collaboration focused on advancing the science, workforce, technology and profitability of the indoor farming industry.

The goal for both partners is to conduct ongoing, deep-dive discussions of post-harvest, production, automation, HVAC systems and other aspects associated with operating a modern state-of-the-art greenhouse.

“Our mutual relationship ticks a number of boxes for each of us where sustainability and productivity meet, and where a maximum use of technology using different growing mechanisms and mediums will benefit all concerned,” Youtsey said.

Youtsey said innovation is driving the indoor farming market.

“California’s 400-plus crops have to be grown somewhere” to feed more people as climate change impacts the ability to grow produce in traditional ways, Youtsey said. “Gotham Greens’ approach is a shining example of what is possible and one that serves as an inspirational pathway for cross-industry expert exposure.”

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