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Fortune 500 firm to bring jobs to Washington Co.

March 08, 2008|By ARNOLD S. PLATOU

WASHINGTON COUNTY -- A Fortune 500 company is planning to open a warehouse distribution center near Hagerstown this summer, officials connected with the project said.

The company, which officials declined to identify, will create "probably around 35 to 50 jobs," said Troy Briggs, director of leasing and development for Liberty Property Trust.

Briggs said the unnamed company will lease 215,460 square feet of space in the 554,000-square-foot distribution center that Liberty is building on 145 acres in the Hunter's Green business park in the Hopewell area near Valley Mall.

"They've asked for confidentiality," Briggs said of the tenant. "It is a Fortune 500 company, probably a Fortune 100 company. It's a big one. It's a good company."

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The company is new to Washington County, he said. But he declined to say whether it's an international firm.

Briggs said the company, drawn to the site because of its proximity to Interstate 81, is planning to begin operations here by July. He said any information about the type of jobs and the wages would have to come from the company itself.

Liberty bought the 145-acre tract, now called Liberty at Hunter's Green, for about $2 million in 2006, according to Bob Mandley of the county Economic Development Commission. He said part of the land was owned by the Hagerstown-Washington County Industrial Foundation and part by Mid-Atlantic Properties of Lutherville, Md.

Liberty, of Malvern, Pa., is the nation's second-largest office and industrial real estate investment trust, according to its Web site. It said the trust has properties in 13 states and the United Kingdom.

Briggs said Liberty is planning to build 1.6 million to 1.8 million square feet of warehouse distribution space on the land here. There could be two buildings, or the one being built now could be expanded, he said.

General contractor Conewago Enterprises of Hanover, Pa., began grading the land last summer. The 554,000-square-foot structure it is building for Liberty is the first phase of the overall project, Briggs said.

In all, the project could cost between $70 million and $90 million, depending on tenants' needs, Briggs said. No other tenant has been signed yet for the first building, he said.

Briggs said the distribution center is being built to meet the Leadership in Energy and Environmental Design (LEED) standards set by the U.S. Green Building Council, a nonprofit organization.

For instance, to win LEED certification, limestone dug up on the land has been crushed for use as a subbase in the center's floor, Briggs said. In traditional construction, the boulders would have been hauled away, he said.

Briggs said Liberty is trying to meet LEED standards on many of its new buildings because that's more environmentally responsible, and many tenants want to be associated with that.

Part of the new construction project is the extension of Newgate Boulevard. At present, the road comes off Halfway Boulevard to serve FedEx Corp.'s 325,000-square-foot distribution hub.

Liberty, whose tract butts the FedEx property on the north, has agreed to extend the road further north the width of its property.

In 2006, the extension was projected to cost about $750,000, said Michael C. Thompson, the county's director of planning. He said the county government is hoping the road eventually will be extended to U.S. 40, opening other land to economic development.

So in return, Liberty asked the Washington County Commissioners back then to give it a tax break, Commissioner James F. Kercheval said this past week.

In general, Kercheval said, the county is not willing to give breaks to warehouse distribution centers, especially when an owner such as Liberty didn't know who the tenants would be, how many jobs they would provide or how high the wages would be.

"However, the extension of Newgate Boulevard has been one of our economic development aims for some time. ... That's going to open up land so we can try to attract better jobs," he said.

So the county agreed, in effect, to give Liberty a credit equaling half the cost of the road by reducing the excise tax it would owe the county for developing the property, Kercheval said.

Thompson, referring to a letter the county sent Liberty back at the time, said it had been estimated that Liberty would have to pay the county a total of $1.267 million in excise taxes. The tax is a levy meant to help government recoup the cost of building further roads and other improvements as the county grows.

The deal struck with Liberty reduced its excise tax bill by $375,000 to less than $900,000, depending on the final size of the distribution center, Thompson said. He said part of that bill would have been paid when the building permit was issued for the first phase, and the rest would be paid as the site is developed.

Thompson said such deals have been a tool that the county has used to enhance economic development.

"Some jurisdictions would say, 'You just build a driveway onto your property,' but we know the road is going to extend ... to open more land for industrial purposes for the county," he said.

"The way we looked at it was, they were extending infrastructure that the county was looking at doing anyway," Kercheval said.

And, as a result, that road is ready when the next company comes looking for land here, he said.

Such deals are like aces in the pocket when counties compete for new economic development prospects, Kercheval said.

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