Dave Olson, Published July 07 2012
Biotech firm, apartment complex seek city tax breaks
The apartment project is a four-story structure proposed on two lots at 400 and 408 Roberts St.
To construct the approximately $5 million complex, JPO Rentals LLP is asking for a property tax break estimated at about $65,000 a year for five years, for a total of $325,000.
Described by JPO Rentals as an upscale residential building, the tenant mix is expected to include students, faculty and young professionals.
Before it was cleared, the lot at 408 Roberts St. was home to a building that once housed the Flame Tavern.
The building later was used as a computer assembly plant and most recently served for a time as the temporary home of part of the Fargo Public Library while the downtown library was being built.
Adding downtown jobs
In the case of the former Woodrow Wilson High School at 315 N. University Drive, the building is in the process of being purchased from the Fargo School District by a biotech company called Aldevron, which plans to spend about $5 million to turn the building into the company’s corporate center.
The interior will be rebuilt to house administrative offices, as well as research and secure laboratories.
The deal to purchase the school for about $700,000 is expected to close by Aug. 1.
“Aldevron will invest significant resources to repurpose and enhance an existing historic building,” the company wrote in its application for Renaissance Zone tax incentives.
“As a primary sector employer, we will bring high-quality jobs and employment diversity to the area. Initially there will be approximately 50 employees with plans for employment growth in the current building to about 150,” the company said, adding that most of the employees will be young professionals from area colleges and universities.
Aldevron is looking for an estimated $600,000 in property tax relief over five years, and an anticipated $120,000 worth of income tax breaks over the same period.
It is also considering asking for state historic preservation tax credits that hold the potential for up to $250,000 in additional income tax breaks, city officials said.
Tax base growth
When it was owned by the School District, the Woodrow Wilson property did not generate any property taxes.
City Planning Director Jim Gilmour said both the apartment project and the Aldevron plan represent major investments.
“Neither of these properties are paying much in taxes now and in year six, down the road relatively soon, we’re going to see some substantial property tax payments,” Gilmour said, adding that both projects will also provide secondary benefits by bringing more people to the downtown area.
“I think we’re fortunate to have a company that could be a major employer move into the downtown,” he said, referring to Aldevron.
“It’s great that they are preserving that Woodrow Wilson building,” Gilmour added. “It’s tough to take an old school building and convert it to another use, sometimes they don’t lend themselves very well to conversions.”
Two other proposals
Two other projects also will be considered for city tax incentives on Monday.
Boulger Funeral Home, 123 10th St. S., proposes a nearly 3,000-square-foot expansion.
The expansion and related work is anticipated to cost more than $750,000 and be completed sometime in December.
The business is asking for a property tax break estimated to be $55,000 over five years and an income tax break over the same period amounting to about $20,000.
Boulger has been at its current location since 1920.
Another applicant seeking a tax break is Brandt Preferred Co., which is looking to move from its location in Urban Plains by Brandt in the area of 45th Street and 26th Avenue South to leased space at 309 Broadway in the Moose-Dixon complex, Gilmour said.
The company is looking for an anticipated income tax break of nearly $2 million over five years.
All four projects are recommended for approval by city staff.
Any projects the Renaissance Zone Authority approves Monday morning will be reviewed by the Fargo City Commission Monday evening.
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Readers can reach Forum reporter Dave Olson at (701) 241-5555