Hutchinson investors seek IRBs to build warehouse in industrial park

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As many of Hutchinson’s larger vacant buildings fill up, a group of local investors decided to pursue construction of a warehouse by speculating on the remaining square footage of the city’s industrial park.

The group, which has formed a new limited liability company called Salt City Investment, will ask Hutchinson City Council on Tuesday to issue $4 million in industrial bonds for the project.

Led by local developer and business owner Brad Pryor, the group of eight hopes the project will spark additional development to fill the rest of the land in the Kansas Enterprise Industrial Park, next to the Siemens Gamesa plant.

“The Chamber had identified a need since we kind of filled all the major vacant buildings in Hutchison,” said Pryor, a member of the Chamber’s Economic Development Advisory Council.

“The Eaton building, the public restroom building that Superior Boiler bought, Target and K-Mart. If you’re scouring the city on what brought potential businesses to town and looking at opportunities to move a business here, they’re filling up, so now we’re marketing bare land. It binds our hands a little, not having a product to market. »

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To attract business quickly, Pryor said, especially with today’s supply chain challenges, “the Chamber was looking for someone to take a leap of faith with and partner with to have a building ready, done and ready. from,” he said.

Once he started reaching out to people, Pryor said, it wasn’t hard to get investors.

The 57,000 square foot building will be located on the last 22 acres of industrial park land at the southeast corner of Commerce Street and Enterprise Drive, which the group is buying from the chamber for $100,000.

They think the land can be divided into four plots and as they fill one building they can build another.

“The first will be built as a warehouse,” Pryor said. “We won’t be too specific on the finishes and we’ll leave some of the floor out, so if they have any specific plumbing needs they’ll have the option to step in and do the plumbing underground and install a floor. . It will be structurally complete and the parking lot will be complete, but the specific tenant will complete it.

The proposed size of the building is the most sought after, according to the chamber, Pryor said.

As soon as they get the building permit, he said, they will start marketing the property nationwide.

“Our hope is that it will be completed by the fall of 2022 and have a signed lease in late 2022 or early 2023,” he said.

Although issued by the city, the company will sell the bonds itself. The city will become the tenant of the property, but Salt City Investment will be responsible for all debt service payments.

They also expect to apply for a 10-year tax abatement on the property. The city could seek a PILOT (payment in lieu of taxes) agreement with Salt City, but the proposal the council will consider on Tuesday does not detail that.

Besides Pryor, which owns Hutchinson’s Papa John’s franchise and developed the Wheat State Plaza mall in the 1400 block of East 30th Avenue, major investors include: Brad Dillon, Steve Dillon, Sid Weins, Jeff Gust, Darren Barnes, Bart Kooiman and FOE4ward LLC, a company organized by Melissa Moodie.

To request the RIRs, the group had to develop a cost-benefit study.

The study, included in the City Council’s agenda file, notes that while the numbers used in the study are speculative, it would have a positive benefit ratio for all entities that would receive taxes on the property.

These estimates include that the eventual occupant would initially employ 10 people with an average annual salary of $40,000 to $50,000, growing to 50 employees over five years, and achieve annual sales of $5 million.

Pryor is listed as the developer of the project, but said he didn’t want people to think he was “the mastermind”.

“I’m the developer, but I think it’s important to note that when all the entities – the city, the chamber, the local investors – are all on the same page, the projects go very well and the community benefits When you get the right community-minded people on a project, with the right partners and the same vision, it’s been very successful.

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