The well-known Schenectady diner will expand in two phases: fi rst with a new production site and later with a new retail spot dedicated to bakery items. The Schenectady Planning Commission on Wednesday approved Blue Ribbon owner Jerry Menagias’ request for a special-use permit to operate the baking facility at 2001 State St.

The Blue Ribbon, located at 1801 State St., purchased the nearby building because of increased demand for its bakery items, Menagias said. The diner opened in 1977, and its cheesecake has won awards in multiple festivals.

The hope is for the bakery production site — a former Maurice’s sandwich shop — to be up and running in time for the holidays, when business tends to increase sharply, Menagias said.

The space is 800 square feet, and only requires small modifications to become a bakery production site, he said. The production space is next door to 2025 State St., where a former IHOP is to be converted into the new Schenectady County Department of Motor Vehicles office.

Menagias plans to open a separate retail bakery, but that will most likely happen at 1865 State St., he said.

The new bakery will require separate approval from the Planning Commission, as the building would need to be remodeled, Menagias said.

He is looking at the fall of 2017 for a possible grand opening, aiming for “before the next holidays.”

The retail spot would operate under the Blue Ribbon name, offering pastries, cookies, cheesecakes, pies and more, Menagias said. In addition, the shop would sell honey, gift items and other goods, he said.

“Schenectady’s really supporting us, and we’re doing really well,” he said. “We’d like to continue under the same way of doing things.”

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Brett Samuels 395-3113, bsamuels@dailygazette.net or

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