98-050 Ordinance - Laserfiche WebLink

Home Browse Search

t ?. ' March 23, 1998 6 DMe R9OIf )/ 1fIV"R18f1t5 North Olmsted Tax Incentive Review/Housing Counsel 5200 Dover Center Road North Otmsted, Ohio 44070 Dear Members: Duke Realty Investments, Inc. ("Duke") seeks a fifteen (15) year Community Reinvestment Area abatement for real property taxes on the value of the office building it proposes to construct at the Great Northem Corporate Center. Attached is Duke's application for the abatcment. Duke's obligation to purchase the subject parcel is contingent on its securing the raquested tax abatement. Duke believes an office building represents the highest and best use for the site and will create more jobs and a proportionately higher level of payroll and, therefore, city income taxes than any other use for which the site is suitable. The building, which will be constructed on the site depicted on the attached drawing, would (a) be approximately 67,000 square feet in area, (b) cost approximateiy $6,800,000 to build, and (c) create, by Duke's best estimates, 175 johs and $6,040,000 in annual payroll one year after completion and fifty additional jobs and $1,750,000 in additional payroll by the third year following completion: Of the $6,800,000 projected cost, approximately $5,000,000 represents hard construction costs. Duke estimates that $110,000 of annual real property taxes would be assessed against the building once completed. The rents which the marketplace dictates can be chazged for space in the proposed office building cannot support the cost of the project unless the requested abatement is granted. In exchange for the $110,000 in real property taxes which would be abated annuatly, the City of North Olmsted would receive, once the building is fully leased, approximately $152,000 in new income taxes ($8,000,000 x 1.990 =$152,000). The building would be completed sometime in mid to late 1999 and the abatement would not commence until tax yeaz 2004. The tand value would, of course, be taxed at all times and improvements in place on January l, 1999 would be taxable for tax year 1999. Once the fifteen year abatement period has run, the building wouid return to the tax rolls. Sincerely, DI W v Enclosure F:UewingUandlNorth OtmctcdUaxl.doc/bas C. EXHIBIT A Page 1 of t ?