A developer is seeking a tax break to construct a distribution building in Greenwood located near the site of another similar building that received a city tax break last month.
The speculative building would be at least the third planned in Greenwood in a little more than a year. At the same time, the Franklin Redevelopment Commission has also been working on a project to help build its second shell building — a structure with four walls and a roof that new businesses could move into and renovate — in the past two years.
E-commerce is driving up the demand for distribution centers, and with space around Indianapolis filling up, developers are taking a close look at Greenwood, Johnson County Development Corp. president Cheryl Morphew said.
"We are in such a digital environment, and there is so much purchasing going on online nowadays that they believe there is this demand for this size of building," she said.
VanTrust Real Estate, a Missouri-based real estate development company, has proposed a 500,000-square-foot, $16.8 million distribution center on 37 acres in the 800 block of North Graham Road, south of County Line Road. No tenants have been lined up for the building, which is being constructed on a speculative basis.
VanTrust is requesting a $2.1 million property tax break over a 10-year period. The city would receive $2.6 million in property taxes during that time period. If the property were not developed, the city would receive $17,660 in property taxes during that time, according to a tax abatement application filed by VanTrust.
Another distribution center is planned just across the street. Opus Development Co. aims to construct a 500,000-square-foot, $12.5 million distribution center with the aid of a 10-year, $1.6 million tax break approved by the city council in October. No tenants are lined up for the property, but developers have estimated that the businesses that move into it could employ up to 200 people.
The willingness of both companies to make such large investments without any clients signed up shows how confident they are in this growing field, Morphew said.
"The market is really good. The economy is good, and there is growth," she said. "When you have those factors, that is when developers are looking at locations of where to invest their next capital."
The redevelopment commission has unanimously approved the tax break for VanTrust. The city council will also need to approve the request.
Construction is expected to begin by April and will be complete in the third quarter of 2017.
The tax break is necessary for this project to be competitive with other ones in the Indianapolis region, company representatives said.
