An empty industrial building in Franklin is one of a few of its kind in the state, and development leaders think that will improve the chances of a company moving in.
City officials envision the 50,000-square-foot shell building at 1725 N. Graham Road becoming the home to a company, which would bring jobs and tax revenue.
The building in Franklin was finished last year and is on the short lists of three companies looking to relocate. City leaders want to sell the building soon, because with each month that passes more taxpayer money is spent on mortgage interest and taxes.
The building is one of a few statewide that can fit the most requested need of companies. About 60 percent of businesses looking to relocate to the state want to move into a building that already has been built rather than construct something new. And those businesses most often request a building with a size of 50,000 to 100,000 square feet, which would include the building in Franklin.
That building is one of eight in the state that meet those space requirements and currently sit empty, and no others are in central Indiana.
But the city may have more competition in the future. The Indiana Economic Development Corp. is starting a campaign for communities across the state to build shell buildings, which are constructed with the basics of a facility and can be finished by the company that moves in.
Other areas likely would take at least a year before they could develop a shell building, between the time for construction and planning, Johnson County Development Corp. chief executive officer Cheryl Morphew said.
“It does give me a little concern that there might be two or three or four others that will pop up in 2014 or even 2015,” Franklin City Council member Rob Henderson said.
The $1.83 million Franklin shell building was built and paid for by Runnebohm Construction, which owns the property. In exchange, the city redevelopment commission agreed to pay costs associated with maintenance, property tax, insurance, utilities and interest payments. That amount could reach $100,000 if the building isn’t sold this year, while the city will have to pay $450,000 for the land if the site is not sold before September 2015.
The shell building has been a finalist for five businesses in the past year, and three of them are still considering the site. One project was scrapped.
Another business selected a location in Ohio since that state does not have a tax on business equipment, Morphew said.
No business has visited the site in the past few months, largely due to the poor weather, Morphew said.
“There were a lot of businesses that came through the winter pretty lean because people were not going out and not spending,” Henderson said. “That then puts everything on pause. I think that delayed some interest in the building.”
Seven shell buildings, all about 50,000 square feet in size, have been sold in Shelby County since 1980. The last building they constructed, in 2008, took almost four years to sell. But most of the buildings sold in two years or less, said Dan Theobald, executive director of the Shelby County Development Corp.
Businesses that have moved into those buildings in Shelby County have been most concerned with finding a workforce to fit their needs. Transportation is a close second, since companies want to be close to major interstates and highways, he said.
“Everybody feels they move because of incentives, but those are way down on their list,” Theobald said.
Areas can benefit from the interest a shell building generates. Ryobi did not buy the shell building it first visited in Shelbyville but ended up choosing another site in the city, Theobald said.
“You can generate interest with a shell building, but then they may see something else in the area they like better,” he said. “That happens often.”
The businesses that have moved into the Shelby County shell buildings have all grown. Each one has at least doubled the size of its building, Theobald said.