RDA Happenings October 2014
Posted on October 1, 2014 – By Emporia RDA
Business clients engaged in a site search for an expansion or a new location in our region will access the RDA website for site selection information.
The initial screening process in a “zone of indifference”, (a generalized geographic area which can be a multi-county and multi-state search) is based on 5 to 10 criteria. Those criteria include one-time fixed costs and the on-going variable costs are the most critical factors to business profitability. Labor availability and skill levels, proximity to their customers, the specific site and real estate attributes are generally in the initial search. After an initial screening and more criteria is considered, the business continues to narrow down the communities for an optimal location, in essence from initial criteria to any multitude of criteria.
Once a business expresses an interest, the real estate is generally one of the most important criteria. If you don’t have the proper site then the business looks elsewhere.
Emporia Enterprises, our industrial land management company, which the RDA staff assists in their search, due diligence and securing of sites for development. It currently has a purchase option on a 318-acre tract. The site is located north of Road 200, west of Road S and east of the Burlington Northern Santa Fe (BNSF) railroad line from Emporia to Reading. Rail road access, a 24” high-pressure natural gas main, a 10” water main with a 100,000 gallon water tower and three-phase electric power are all available adjacent to the site.
The site is located approximately six miles northeast as “the crow flies” from Emporia. Cattle grazing and a haying operation are the current land uses. Very few homes are located in close proximity to this site; all the adjacent land uses are agriculture with pastures and cattle grazing. East of the site approximately 1/3 of a mile is the Westar Energy Emporia Energy Center.
The Emporia Enterprises Board of Directors has secured a two-year purchase option on the tract, which expires on December 31, 2014. Over the past two years there have been two prospective industries that considered the site. The first business is no longer considering the site and the second business has the site under consideration.
Having a purchase option on the site has allowed us to proactively market this site with BNSF to be competitive on projects. Only two or three other Kanas communities have sites with rail access and size. This gives Emporia a comparative ad-vantage.
The land acquisition, road paving and utility extensions should be considered investments. Based upon the past successes our region has had a tremendous return of investment in quality job creation, capital investment and expanded real property tax base.
In southeast Emporia the area we refer to as Park III, where Simmons Pet Food, Camoplast Solideal, Norfolk Iron & Metal, Hills Pet Nutrition and the Lenze building is located the total number of jobs created was nearly 700, the appraised real prop-erty value has increased to $23,348,660 with total annual property tax of $944,340 and 233.6 acres are developed. Two of the six businesses have a tax abatement which expires in the future, which is estimated to increase the appraised value by $15,724,660 and estimated property tax.
Earlier this year Simmons announced an expansion which will create more than 80 new jobs and a significant capital invest-ment. The Return on Investment (ROI) continues to grow. We have another 88 acres to develop.
Based upon the past experiences of development in Park III, the 318-acre industrial site could yield a ROI of $48 to $53 mil-lion in real property appraised value increase and 800 to 1,000 new full-time jobs at total build-out. This does not happen overnight, but with patience and staying the course it will develop.
Our objective at the RDA is to create quality jobs and grow the economy. This proposed 318-acre site would provide an excellent return on investment in the future decades.