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County, city OK financing, contract on shell building
At Patriot Centre industrial park
Wednesday, September 11, 2013
Henry County and Martinsville officials on Tuesday approved financing and awarded a contract to build a shell building on Lot 8 in the Patriot Centre at Beaver Creek industrial park.
Construction is expected to be completed in March.
When it is finished, the building will serve as bait to attract companies to locate in the area and also be “something for somebody to catch and fill up with job opportunities,” County Administrator Tim Hall said during a joint meeting of the Henry County Board of Supervisors and the county’s Industrial Development Authority (IDA) on Tuesday afternoon.
In majority votes, both boards took action to move forward with the project. Ridgeway District Supervisor H.G. Vaughn was unable to attend the meeting.
Martinsville City Council, in a unanimous vote on Tuesday night, adopted a resolution to execute an agreement related to the city’s involvement in the project.
The IDA awarded a $3.5 million construction contract to Blair Construction of Gretna. The company’s $3,418,500 bid was the lowest among the eight bids received, Hall said.
The bids were competitive and fell within “a pretty tight window,” Hall said. The highest was “a little over $4 million,” he said.
Work will start on the 96,970-square-foot building on the roughly 17-acre tract at the Patriot Centre as soon as possible, Hall said.
The board of supervisors was briefed on the shell building project in January and gave county staff permission to work on financing, Hall said.
Carter Bank & Trust was the sole bidder on the $3.5 million lease/bond project. Its bid included a fixed interest rate of 1.95 percent for the first five years, Hall said.
“We were disappointed to only get one bid, but we were thrilled when we opened it,” Hall said of the interest rate.
The Martinsville-Henry County Economic Development Corp. (EDC) will pay start-up costs and the first year’s interest, Hall said.
The city and county are responsible for paying the interest in years 2-5 on the customary two-thirds, one-third split, he said.
The county’s share of the interest will be about $45,500 annually and the city’s share will be about $22,750 a year, an EDC document shows.
Principal on the note can be repaid at any time without penalty, Hall said.
The shell building as proposed was 75,000 square feet, not including office space of roughly 5,500 square feet. When the bid came back, it included an extra 15,000 square feet overall.
Officials realized “we were able to get a larger building on the site than we thought” possible, EDC President and Chief Executive Officer Mark Heath told the council Tuesday night.
The building can be doubled to more than 180,000 square feet easily on the same lot, Hall said.
It will be built of high quality materials, with a gravel floor, to allow for drains or other specialty equipment needed by the prospective owner, he said.
Heath said he knows of no other locality in Virginia that constructs shell buildings as modern as those in Martinsville-Henry County
This will be the third shell building that the county, city and EDC haved partnered to build, Hall said.
“We started small” on the first shell building, which was an estimated 50,000 square feet, he said.
Additions were made and other structures built to house RTI International, Hall said.
The second building, a 75,000-square-foot structure, now houses Commonwealth Laminating, he said.
Without the shell buildings, Hall said he did not know that either company would have located in the area.
“Our shell building program is one that we can literally reach out and touch the success of,” Hall said Tuesday. “We can literally and figuratively see the success.”
Martinsville Vice Mayor Gene Teague acknowledged that some people in the community are skeptical about the use of shell buildings in industry recruiting efforts.
“But we’ve proven in our community that shell buildings work,” Teague said.
After Commonwealth Laminating took the previous shell building, the EDC saw prospective companies’ interest in the community decline, Heath said.
Teague said the new shell building “will help generate additional prospects.”
A groundbreaking ceremony for the new building will be held on Lot 8 at 3 p.m. Sept. 18.
In other business Tuesday afternoon, Hall gave a brief update on permitting work for the Commonwealth Crossing Business Centre (CCBC).
Work on financing and related tasks needed for the shell building was delayed primarily because county and economic development officials also were working on obtaining a permit for grading and other site work at the CCBC, Hall said.
Permits have been issued by the state, but they have not yet been issued by the Environmental Protection Agency (EPA). The U.S. Army Corps of Engineers is acting on behalf of the EPA on the matter.
Hall said the EPA asked the county to hold a second public notice/comment period on the proposed project at CCBC. The first such period expired Aug. 30 and was extended — at the behest of the EPA — to Sept. 16.
The supervisors also informally approved partnering with Martinsville to give an annual Veteran’s Award, and making the ceremony in November that has been held by the supervisors more of a community event.
Martinsville City Manager Leon Towarnicki announced the partnership during the council meeting.
It is unknown whether the criteria for the award will change, said Assistant County Administrator Dale Wagoner.