OVERVIEW
FOR COUNCIL OF 100 INDUSTRIAL USERS
SAGER
CORPORATE PARK, BELVIDERE, IL
This overview contains general information on
the Sager Corporate Park "Sager", the community it is located in, specific
sites within Sager we would propose for 5-30 acre light industrial uses,
general building and landscaping criteria for the overall development, economic
incentives available to those that locate within the development and proposed
financial terms for various transactions.
OVERALL PLANNED DEVELOPMENT/COMMUNITY PROFILE
Located between Interstate 90 and U.S. Route
20 in Belvidere, Illinois, the Sager Corporate Park has been designed to cater
to many types of office, warehouse, light industrial and distribution uses.
Conveniently located just one half mile west of the Genoa Road interchange,
this 130 acre site provides easy access and high visibility for those desiring
such a location. Location maps are included in the back of this overview as
Exhibit A and Exhibit A-1.
The office parcels are being platted for
users of 3-4 acre tracts, with some land available for larger office uses. Plat
No. 1 of Sager Corporate Park, the first final plat, contains Lots 1-4, all of
which are zoned for office uses. A copy of Plat No. 1 of Sager Corporate Park
has been included in this overview as Exhibit B. Lot 1 and Lot 2 of Plat No. 1
are under contract and optioned respectively. The warehouse/distribution and
light industrial parcels have been tentatively platted for users of 5-12 acres.
No final plats have been submitted for the warehouse/distribution and light
industrial lots. We have one building of 45,000 square feet that will begin in
early September on Lot 18. Excluding Lot 18, we currently have the flexibility to
combine any other parcels shown on the Tentative Plat included in this package
as Exhibit C. Exhibit C also depicts the USGS topographic contours. We have
flown this parcel and have mapped the entire property into one foot contours.
This information is available upon request if the USGS contours are inadequate.
The Sager Corporate Park is within the city
limits of Belvidere and the proposed light industrial uses comply with the
City’s Comprehensive Plan and the land’s underlying zoning. City watermain (both
10" and 12" w/ a potential capacity of 5,000 gpm) and a trunk
sanitary sewer have been extended through the 130 acre parcel. There is a
regional natural gas transmission main adjacent to the property and significant
power. Depending on the actual parcel selected, the land would be ready for
development immediately. All other land could be fully developed and available
within 3-4 months of the final site selection.
The property is currently used for
agricultural purposes. Any portion of the land can be taken out of production
at any time. Preliminary soil borings extended to 20’ in various locations
throughout the site indicate a bearing pressure of 3,000 psf without any
special construction considerations. Phase 1 Environmental Assessments indicate
that the property is free of any hazardous wastes. The current owners have
maintained the land in rotated crop production for approximately fifty years.
The City of Belvidere is approximately 35
miles northwest of the Chicago suburbs, 50 miles northwest of O’Hare
International Airport and approximately 7 miles east of the Rockford Airport.
The Rockford Airport has foreign trade zone status and also contains a United
Parcel Service sorting hub. There is no rail service available at this site.
The City of Belvidere has experienced a boom in residential construction over
the last four years, driven primarily by suburban flight to exurban
communities. With the relocation of Sears, Ameritech and others to large
suburban style office campuses in Hoffman Estates, the limited traffic reverse
commute from Belvidere into the suburbs, coupled with affordable housing and
excellent schools, has become a desirable life style alternative to the
northwest suburbs. A large percentage of the new families coming into the area
are two earner transplants that remain employed in the suburbs but would
welcome local employment opportunities.
Belvidere has a current city population of
approximately 18,000 people. The unincorporated areas within approximately five
miles of the city limits contain almost another 17,000 people. City government
is currently a mayor/city council form of rule.
Belvidere has a stable skilled worker base
and many large employers with a mix of non-union and union shops. Area
employers and their labor status are as follows:
o
Chrysler Corporation,
3,400 employees w/ UAW and Teamsters affiliation
o
Pillsbury - Green Giant,
375 employees w/ no union affiliation
o
Belvedere Company, 250
employees w/ no union affiliation
o
Camcar/Textron, 240
employees w/ no union affiliation
o
Dean Foods, 150
employees w/ Teamsters affiliation
The tax rate for this parcel has remained
steady at approximately 7.15 since being annexed into the City of Belvidere in
1990. The multiplier has historically been 1.00. This tax rate is substantially
less than surrounding communities, representing a large operating cost
advantage for this site. In addition to this low tax rate, a sliding scale four
year tax abatement can be secured for land within this development. Details of
the abatement are included in the economic incentives portion of this overview.
We have also included a copy of a Concept
Plat, Exhibit D, for the land directly east of the Sager Corporate Park. The
Concept Plat provides a preliminary look at how we anticipate making the future
connection with Genoa Road and the I-90 Tollway Exit Ramp. We have tentative
approval of this connection from the Toll Highway Authority. We have no plans
to plat this land until we have secured the required access. We did, however,
think this Concept Plat would be helpful in analyzing the long term potential
of the Sager Corporate Park.
RANGE OF PARCELS WITHIN THE DEVELOPMENT
As previously noted, the site provides many
different opportunities for users within the development. I-90 Tollway exposure
(Lot 17) is available for those users desiring a highly visible location. A
company selecting an I-90 site would capitalize on exposure to 30,000 Tollway
users each day.
It should also be noted that all parcels in
the Sager Corporate Park are located entirely within an area designated for
business use. Operation of a facility on a twenty four hour/seven day a week
schedule would not be disruptive to any adjacent uses. Detention
requirements have been satisfied for all parcels at an off site location. Sites
in the Sager Corporate Park are comprised of entirely all usable area. This
should be kept in mind when comparing Sager Corporate Park to other
developments.
None of the property is within the floodplain
or contains any areas designated on NWI (National Wetlands Inventory) maps.
BUILDING AND LANDSCAPING REQUIREMENTS
Development within the Sager Corporate Park
will be governed by a Declaration of Industrial Standards and Protective
Covenants ("Declaration"), a proposed copy of which is attached as
Exhibit F. The Declaration will, among other things, subject all new
construction to architectural review procedures for both the building and
landscaping components. The desire is to create a first class environment of
architecturally compatible facilities and grounds that will be operated and
maintained in a manner that will safeguard the physical fixed asset investments
of all users within the Park.
Specific requirements are included in the
Declaration. Generally accepted types of buildings will include the following
exterior materials:
o
Precast Concrete Panels
o
Glazed Curtainwall
Applications
o
Stone/Brick, Other
Acceptable Masonry Applications
o
Dryvit/Stucco Accents
Only
o
Other Exterior
Applications as may be agreed upon by Declarant, including appropriate
prefabricated metal structures
Minimum landscaping requirements will include
compliance with local ordinances, provisions to water the grounds and
landscaping around any offsite trash receptacle areas.
All buildings will be required to be ADA
compliant and provide adequate off street parking for their intended use.
Parking layouts that contain only the minimum parking required by code will not
be approved if the use dictates additional parking.
ECONOMIC INCENTIVES
The Sager Corporate Park is located within
the Belvidere/Boone County Enterprise Zone. A number of economic incentives
will automatically apply to new developments within the Enterprise Zone. These
incentives, as well as how a company would benefit are detailed below.
Property Tax Abatement:
Property taxes are
abated on improvements to commercial and industrial property in the
Belvidere/Boone County Enterprise Zone ("Zone"). Taxes are abated
incrementally over four years as follows:
Year
1 80%
Year
2 60%
Year
3 40%
Year
4 20%
Property owners
receive this benefit directly. Should this be a lease situation, we would agree
to pass the tax abatement through to the end user on a dollar for dollar basis.
Additionally,
industrial taxpayers, once located in the zone, may qualify for an additional
four years of incremental abatements if said taxpayer is the reason a supplier
relocates to or constructs improvements in the zone. A suppliers improvements
must be constructed within five years of the original taxpayers improvements
being assessed at full value. The supplier is eligible for the abatements
detailed above and the original taxpayer may qualify for an additional four
years of abatements, on the same terms as above, if the suppliers improvements
are at least $2,000,000. Should the suppliers investment be less than
$2,000,000, a proportionate share of the real estate taxes would be abated.
Sales Tax Exemption:
All building
materials purchased in the City of Belvidere or in unincorporated Boone County
are exempt from State, City and County sales tax as long as said materials are
permanently incorporated into the real estate located in the Zone. Purchases
can be made from any local, state or national company as long as a sales office
or outlet is established somewhere in Belvidere or Boone County and the company
supplying materials is registered with the State of Illinois as a retailer with
multiple locations. Enterprise Zone Retail Sales, Inc. is an entity that
currently operates within the Zone and can act as the sales outlet for any
local, state and national company. This entity has been recognized by the State
of Illinois to act in this capacity. Some of the more recent materials
purchased through this entity were incorporated into the new Chrysler stamping
facility.
At the current
time, this exemption is equal to a 6.25% discount on materials used in the
construction of a building. Examples of materials that qualify are concrete,
steel, bricks, lumber, plumbing systems and components, HVAC systems and
components, electrical systems and components, permanent floor coverings
(ceramic, etc.,) and any other built-in appliances or cabinetry.
Investment Tax Credit:
Tax credits (direct
offset against state income taxes payable) totaling up to 1.5% are available
for investments in qualified property in the Zone. The State currently allows a
.5% ITC credit against the Corporate Replacement Tax. In addition to this
credit, the Illinois Income Tax Act provides for a .5% ITC against the State
Income Tax for all qualifying investments placed in service in an Enterprise
Zone. These credits are available regardless of the size of the investment or
any employment considerations. The credits are a tremendous benefit for any
company that generates taxable income in the State of Illinois. We are also
attempting to clarify certain provisions with respect to racking installations.
It appears that the cost of racking installations may also qualify for ITC
treatment, which, if any portion of the use relates to warehouse/distribution
activities, could result in a tremendous amount of additional tax credits.
In addition to the
1% credit noted above, an additional .5% ITC is available if the company’s base
employment within Illinois increases by 1% over the preceding year. If this
location presents an opportunity for new Illinois employment, this could become
another valuable incentive available at the Sager Corporate Park.
The credits can be
carried forward for a period of five years if not fully utilized in any one
year.
Utility Tax Exemption:
This exemption is
available to the extent a business makes a $5,000,000 investment in the Zone
and the business creates 200 full time jobs, or makes a $20,000,000 investment
and retains a minimum of 1,000 full time jobs within the State. "Job
Creation" for purposes of this exemption is defined as the number of full
time equivalent employees who have been hired during the year over the number
of full time equivalent employees that were employed by the entity as of
December 31st of the prior year. Jobs filled as the result of a
strike or previous layoff do not count as new jobs that have been created. All
"job creation" must be in the Belvidere/Boone County Enterprise Zone.
Full time equivalent jobs are defined as jobs that require the employee to work
35 hours per week for at least thirteen (13) consecutive weeks.
Businesses that
meet this criteria are exempt from paying all or a portion of the 5% state tax
on gas, electric and messages. We believe telecommunication bills qualify for
the exemption under the "messages" category. The exemption becomes
effective six months after the Department of Commerce and Community Affairs
certifies that the entity applying for the exemption meets the criteria
established above. The following factors are used to determine the length and
total percentage available for exemption:
o
Total Zone investment
o
Total Jobs created
o
Utility usage
o
Beneficial economic and
social impact of the business on the community
In addition to this
exemption, representatives of local utility providers have offered to make
themselves available to provide energy cost and other analyses that may prove
helpful in evaluating this location.
Permit Fee Reductions:
This project will
receive a 50% reduction in the cost of all required permits and fees.
Other Incentives That May Apply:
Dividend
Deduction - Dividends paid by a
corporation that transacts substantially all of its operations within the Zone
are not included in an individuals taxable income. This is a substantial
benefit for Illinois business owners that pay themselves dividends.
JTPA - $500 per employee tax credit for hiring
"eligible" individuals that remain employed 30 hours per week for 180
consecutive days.
FINANCIAL MODEL
We have prepared a brief economic model for
evaluation purposes. The model is based on a conceptual 150,000 square foot
turnkey building on 15 acres of land in the Zone. The model is attached to this
proposal as Exhibit E. This is a basic model that demonstrates the potential
economic benefits of the Zone compared to other properties. The model is for
comparison purposes only and should not be construed to be an offer to sell any
land or develop a building on the terms so set forth.
PRICING AND AVAILABILITY
Lot 5 and Lots 10-17 are available at this
time. Lot 5 and Lot 10 & 13 are priced at $.95 per square foot. Lot 11, 12,
14, 15 and 16 are priced at $.85 per square foot and Lot 17 is priced at $1.10
per square foot. Any transaction would be subject to such other terms and
conditions as would be set forth in a mutually agreeable purchase and sale
document and the prior sale of any one of the aforementioned parcels.
We also offer alternatives to an outright
purchase of the land. We will consider an unsubordinated ground lease and will
also consider developing a building to user specifications and entering into a
long term lease transaction once the building is completed.
Respectfully Submitted on Behalf of
Ownership,
Gregory W. Brown
President and CFO