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Council OKs 12-acre deal, city’s largest industrial building
The city approved a deal last week to bring Elgin’s first speculative industrial building to its business park, paving the way for major development, officials said.
City Council greenlit a purchase and sale agreement April 21 between the Elgin Economic Development Corporation and Downstream Interests LLC for two parcels in Elgin’s industrial park, 508 Innovation Way. The
“This project is a transformational step for Elgin’s economy.”
— Kaley Frye, EDC land totals 12 acres and will be sold for about $1.5 million, according to city records.
“This project is a transformational step for Elgin’s economy,” said EDC Director Kaley Frye. “We’re positioning our community to compete for high-quality employers, create jobs and expand our tax base in a way that benefits residents for years to come.”
The project calls for construction of a class A industrial facility, expected to be completed within 18 months of closing, according to the city.
Officials called the move the first of its kind for Elgin, designed to attract companies seeking ready-to-occupy spaces. Designs call for a flexible industrial building that could house a single large tenant or be divided into as many as four spaces, depending on market demand. The facility will include features such as loading docks, high-clearance ceilings and modern industrial design standards.
Frye said the project would meet the growing demand from companies that prefer existing buildings rather than constructing new facilities.
“We’re getting a lot of requests right now for existing buildings from a lot of foreign investment,” Frye said. “They don’t understand how to develop here, so they want somewhere they can move quickly.”
As part of the agreement, there is a minimum capital investment of $10 million, with the potential for more depending on tenants and equipment. Officials said the development is expected to expand the city’s industrial tax base and provide room for local businesses that have outgrown current spaces.
“One thing we know we need in Elgin is expanding the industrial tax base … this will be a big chunk of that,” Frye said. “This is a project I’m really proud of the EDC for thinking outside the box to bring a good, solid development to the community that has potential to create a lot of jobs.”
To ensure quality and timely construction, the agreement includes development restrictions and safeguards that allow the city to repurchase the land if construction does not begin on schedule. Frye said the standard will remain tied to the property even if ownership changes.
“So we had to put a little bit more restrictions on it to make sure that somebody wasn’t going to bamboozle us,” she said.
The agreement also includes a master lease component in which the EDC agrees to lease any unoccupied space for up to one year after completion.
“It’s very hard to borrow right now for industrial buildings without a tenant in place,” Frye said. “It kind of mitigates the risk for the developer with us putting a little skin in the game.”
The facility will be the largest industrial building in Elgin once completed, according to the city.
