04-22-02 Community & Economic Development

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. 1 . Community and Economic Development Committee April 22, 2002 Page 2 summarized his report dated February 13, 2002 (copy attached), noting that a summary was also provided at the March 25,2002 Community and Economic Development Committee meeting. The petitioner is SBL Building Co., LLC which is a recently formed Indiana limited liability company composed of two (2) member limited liability companies, namely DS Building Co., LLC which has two (2) shareholders Konopa; Reagan & Kenyon, PC and TH Building Co., LLC, the equity owners of which are the partners of Tuesley & Hall, LLP. The petitioners plan to rehabilitate and convert the former South bend Orthopedics Professional Office Building. It will be converted from a single medical user and medical rehabilitation tenant into a multi-user professional office building which will house two (2) law firms. There will also be 1,750 square feet available for a third party. The cost of renovation is estimated to be $685,000. Mr. Beitzinger then reviewed in detail the information set forth under"Abatement Qualification"on pages 2-3 of his report. Mr. Timothy D. Hernly of Barnes & Thornburg made the presentation. He noted that the tax abatement would be addressing a formerly vacant building which will have over a $750,000 investment by the petitioners. Mr. Hall noted that the total investment will be over $ 2 million when the purchase price is included. Following discussion, Dr. Varner made a motion, seconded by Council Member Ujdak that Bill No. 02-19 be recommended favorably to Council. The motion passed. The Committee then reviewed Bill No. 02-36 which is a ten(10) year real property tax abatement request for the property located at 1902 West Sample Street requested by the South Bend Redevelopment Commission for the benefit of AJW South Bend Realty Corporation. Mr. Beitzinger reviewed his report dated April 12, 2002 (copy attached). He noted that AJW South Bend Realty Corporation is a real estate holding company for AJ Wright, a division of the TJX Companies, Inc. They proposed to build an 800,000 square foot warehouse/distribution center at the southeast corner of Sample and Olive Streets. AJ Wright sells off-price apparel at forth-six (46) retail locations throughout America, and the South Bend location will service the company's Midwest stores. There will be two(2) phases to the project with Phase I consisting of developing 500,000 square feet with a ground-breaking proposed for July 2002. Phase II will consist of 300,000 square feet with the proposed ground-breaking set for July of 2005. The project will be built on seventy(70)acres in the Sample-Ewing Development Area. Building costs are estimated to be $24 million and land costs are estimated to be $2.5 million. Equipment at the facility will cost $20 million for a total project cost at approximately $47 million. He directed the Committee to the special language included in Section V of the proposed Resolution. Council Member King noted that the language in Section V has been used in prior resolutions addressing special situations. Patrick McMahon of Project Future, Louis Julian, and Ken Downey then spoke in favor of the proposed abatement. Dr. Varner noted that with the abatement fifty percent of the $5.7 million tax obligation would be abated. He stated that this is a good project which utilizes a lot of vacant land. Council Member Ujdak noted that Schedule B shows that the current revenue stream being