The good news is that a major local manufacturer, Sheffield Pharmaceuticals, is expanding and doing so in the region. The bad news is that New London could not accommodate that expansion.

Last week brought news that Sheffield, based on Broad Street in New London since 1850, had purchased for $3.7 million 136,000 square feet of warehouse space in the Stanley Israelite Norwich Business Park. The vacant space at 9 Wisconsin Ave. in the business park was formerly used for a screen printing operation.

Sheffield manufactures over-the-counter health products, both its own brands and through contracts with other companies. Products include toothpaste, various creams and ointments and beauty products.

The company plans to move storage and distribution operations to the large Norwich facility, with its six loading docks, ample room for truck operations and ready access to Interstate 395.

The company, which according to its website employs more than 200 people, plans to continue manufacturing operations in the New London facility at 170 Broad St., Chief Operating Officer Jeff Davis told The Day. He expects business and the workforce to grow.

Trucks faced a challenge maneuvering in and out of the New London property, where the four-story factory is squeezed into an urban setting. It demonstrates the company's commitment to the region and its employees that it chose to expand here in southeastern Connecticut.

New London's inability to provide a comparative facility for expansion demonstrates the competitive disadvantage the city faces when it comes to generating the commercial and industrial development necessary to diversify the tax base and ease the property tax burden placed on homeowners.

Only 10.76-square-miles in size, about half of that water, the densely developed New London does not have the vast acreage that many of its neighbors utilize to develop business parks. It is why the city has to figure out a way to attract tax-paying development to the Fort Trumbull peninsula.

In the meantime, New London should welcome the news that while Sheffield may be expanding elsewhere, it is staying in the city. The jobs and tax revenue Sheffield generate are critically important for the city.

As for Norwich, the news may be another sign the economy is picking up, with the prospect of finding more tenants for a business park that suffered vacancies in the wake of the economic downturn.