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2.
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| City Council Regular Meeting |
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| BACKGROUND |
3009 OAC Investments, LLC seeks to construct a 9,900 sq. ft. office building generally located near the southeast corner of Elbel Rd and Roy Richard Dr. The development will consist of $3,000,000 in real property investment and create 1 full time job and 40-60 general contractor positions that will use the site as a base for remote work throughout the area.
The anchor tenant will be Coldwell Banker D’Ann Harper, REALTORS® is the leading residential real estate brokerage in the South Texas and San Antonio area with 9 offices and more than 425 Sales Agents serving the local communities. The company services roughly 7,500 square miles of the central Texas real estate market including the areas of Bandera, Boerne, Fredericksburg, Kerrville, Schertz, New Braunfels, San Antonio, San Marcos and Universal City.
The project was impacted by an unexpected cost of the extension of backbone power infrastructure across Roy Richard Dr. and the inability to secure concessions from the City of Schertz to provide power to the site via overhead power lines. Typically, to manage costs in support of this type of development, the City of Schertz may provide, on a case-by-case basis, the option of waiving the requirement to provide power to the site through undergrounding of utilities. Allowing developments to secure power through overhead lines lowers and balances costs in certain instances and when appropriate. However, this site was impacted by the inability to secure easements from the Schertz Seguin Local Government Corporation (SSLGC) and GVEC. These entities could not provide easements without impacting operational standards for access to their facilities, and so the City of Schertz could not provide any further assistance to manage the cost of the extension of utilities.
GVEC estimates the total cost for the provision of power, including the extension of backbone infrastructure, to be over $108,000 for each of the two projects seeking to invest in a similar office development along Roy Richard Dr. This includes a GVEC credit of over $5,000 for two years of projected usage. The companion development is RE Schertz, LLC. is impacted by the same challenges and constraints for an even smaller development. While the projects are being provided separate agreements, SEDC staff reviewed the project understanding this investment would enable both projects to proceed. |
| GOAL |
| Support the continued office/retail development along Roy Richard Dr. and secure the development of 9,900 sq. ft. office building through the provision of assistance to extend backbone electrical infrastructure through a partnership between the City of Schertz and the Schertz Economic Development Corporation. |
| COMMUNITY BENEFIT |
| Provision of electrical infrastructure necessary for new office/retail development along Roy Richard Dr. This action secures a 9,900 sq. ft. office building and new taxable value of approximately $2,000,000. |
| SUMMARY OF RECOMMENDED ACTION |
| Approval of a Chapter 380 economic development performance agreement and a one-time SEDC Infrastructure Grant with a combined value of no more than $50,000 over a period of up to 10 years to support continued retail/office development along Roy Richard Dr and secure a 9,900 sq ft office building. |
| FISCAL IMPACT |
Over a ten-year period, the estimated revenue to the City of Schertz is projected at approximately $99,000. With a total maximum grant value of $50,000 over a ten-year period, this agreement will have an estimated net fiscal impact is $49,000.
The City of Schertz will budget annually for the estimated annual grant of $4,950 (up to $25,000 over 10 years) from the General Fund. Additionally, SEDC will pay a reimbursement grant of up to $25,000 from an allocation from the SEDC Reserve Fund.
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| RECOMMENDATION |
| Staff recommends approval of City Council of Resolution 22-R-110. |
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