GOSHEN — Plans for the development of a large industrial campus on a southside property once targeted for development by Lippert Components took an initial step forward Tuesday during a meeting of the Goshen Redevelopment Commission.
At the meeting, commission members approved an infrastructure funding agreement with Ryan Thwaits, co-owner of development group Last Dance LLC, connected to the group’s plans to construct a new multi-building industrial campus on a 150-acre parcel located just southeast of the Elkhart County 4-H Fairgrounds on East College Avenue.
According to Becky Hutsell, redevelopment project manager for the city, Last Dance LLC purchased the 150-acre tract of land, known as Tract 1, from Lippert Components last fall.
“This was the land that Lippert had annexed into the city in 2018 as undeveloped industrial land,” Hutsell said of the property.
Lippert’s plan for that property, which later fell through, involved using the property as the location of a $20 million facility focused on light manufacturing, research and development with the potential for multiple facilities at the site.
Following Last Dance LLC’s initial 150-acre purchase, Hutsell noted that the group went on to purchase an additional 100 acres east of the former Lippert parcels in November, known as Tract 2, and another 63 acres of nearby land located on the south side of East College Avenue in February, known as Tract 3.
“Total investment by the developer to date is just under $6 million,” Hutsell said of the property. “(Last Dance LLC) purchased land on both the north and south of College Avenue with the intention of addressing the flooding issues that plague this area to allow for development of all land through one overall stormwater drainage plan and subdivision.”
Hutsell noted that it is Last Dance LLC’s intention to proceed with annexation of the two additional parcels of land and to request that, once annexed, they be combined with Tract 1 into a newly-created city TIF.
INFRASTRUCTURE NEEDS
In order to prepare the site for future development, Last Dance LLC first needs to establish the needed infrastructure at the site, such as water, sewer and flood control, which is expected to cost about $14 million, Hutsell explained.
A breakdown of that needed work is as follows:
• College Avenue roadway and storm sewer improvements — $3.6 million
• College Avenue sanitary sewer (to site) — $1.1 million
• On-site sanitary sewer/ water main/roadway Loop (public) — $3.2 million
• College Avenue to C.R. 31 to Kercher Road to Century Drive water main loop — $2.1 million
• Flood routing and control, including side ditches, culverts and ponds — $3 million
“Although the developer intends to begin their project with the initial Lippert parcels, their long-term goal is to possibly expand their development to the additional 100 acres on the north side, east of Lippert parcels, and then either develop the 60 acres on the south themselves or remedy the stormwater issues by tying in the stormwater on the south into the overall drainage system and then finding a developer for that land,” Hutsell told the commission. “The scope of work includes roadway improvements to the east edge of the developer’s land and would serve all three development areas.”
Hutsell noted that Last Dance LLC plans to invest an additional $26 million into the site over the next three years, which includes a commitment to construct two manufacturing buildings and one lamination building at the site by Jan. 1, 2023 In addition, the group also has plans to construct one additional manufacturing building by Jan. 1, 2025, one additional manufacturing building by Jan. 1, 2026, and one additional manufacturing building by Jan. 1, 2027.
FUNDING AGREEMENT
Given that planned commitment, Thwaits went before the commission Tuesday to request that the RDC fund all public infrastructure improvements needed to get the site ready for development.
“It would be our intention to fund this through a combination of TIF funds from the Southeast TIF and a bond,” Hutsell said of the request.
According to the proposed bond scenario outlined by accounting firm BakerTilly, such a bonding process would proceed as follows:
• It is anticipated that the committed buildings would generate approximately $968,260 annually in TIF revenue by 2028 and would provide a bond capacity of $10.43 million for the RDC, of which approximately $9,445,000 would be available to fund the project.
• Last Dance LLC will be buying the bonds and they will be payable solely from tax increment generated from the proposed project.
• Last Dance LLC is requesting that 100% of the TIF revenue from their projects on the 313 acres go towards repayment of the bond.
“If only the six buildings are constructed, it is anticipated that it would take 20 years to repay the bond,” Hutsell told the commission. “However, the developer intends to construct a total of eight buildings on Tract 1 with additional development potential on tracts 2 and 3. Committing all revenue from these projects to bond repayment will allow for a quicker repayment. Once debt is repaid, RDC will capture all TIF revenue for future projects.”
In addressing the benefits of such a proposal, Hutsell noted that aside from the on-site water, sewer and roadway loop tied directly to the proposed Last Dance LLC development, the additional infrastructure improvements, such as the water main loop and flood routing and control projects, will provide a benefit to the overall area by addressing current barriers to development and preparing new land for future development.
“The developer has indicated that their projected investment over the next three years is $26 million dollars,” Hutsell added of the plan. “Their projections show that they will be adding approximately 500 new jobs with an average wage of $40 per hour within that same timeframe. The public infrastructure expenses are not included within their anticipated investment.”
As currently proposed, Hutsell noted that the entire project will be bid as a city project once bond funds are in place, with bidding for the project expected to take place in the fall, followed by construction in 2022.
She also noted that the project will be contingent upon annexation approval for tracts 2 and 3.
“I think it’s a great project for Goshen, and hopefully it will get annexed and everything will get approved,” commission member Tom Stump said of the project prior to Tuesday’s vote.
Thwaits, a native of the area and a Fairfield High School graduate, echoed Stump’s excitement.
“Most of my adult life, I’ve either been employed or an employer here in Goshen,” Thwaits said. “It’s exciting for me to look at doing a development of this scale in the city that I’m from. So, over the past nine months, it’s been great working with the city to try to finally make this dream become a reality.
“In the next five to seven years, we’re hopeful of creating 1,000 to 1,500 jobs, and probably putting about $60 million into the infrastructure of Goshen,” Thwaits added of his future development plans. “Our goal is not to just create jobs, but to create a work environment that’s unrivaled in the area.”