Gratis Industrial Ground Remains a Go-To Incentive


Gratis Industrial Ground Remains a Go-To Incentive
“Where some come asking for incentives, Amazon didn’t,” said Bryan Day, executive director of the Little Rock Port Authority. (Karen E. Segrave)

Free land is a common commodity in packaging incentives to attract industrial prospects to bring new jobs to town. But when representatives of e-commerce giant Amazon came calling on Little Rock with more than 1,000 jobs, no corporate hand was extended with an expectant: What are you going to do for me?

“There was not, which is not unusual for that company,” said Jay Chesshir, president and CEO of the Little Rock Regional Chamber. “It’s their way of doing business. It is unusual for the vast majority of other companies.”

Unlike most companies shopping for potential sites, Amazon officials weren’t particularly interested in how much sugar state and local officials might offer to sweeten a deal.

“Amazon, on the other hand, said, ‘We have to be in Little Rock, and we really don’t need anything,’” said Bryan Day, executive director of the Little Rock Port Authority. “Where some come asking for incentives, Amazon didn’t. It is refreshing.”

The company identified a favored site in the Little Rock Port Industrial Park and agreed to pay market rate for the property, about $40,000 per acre. But to make that $3.2 million location work, the supporting infrastructure needed improvement, especially the road network.

“They were pretty adamant they wanted to be in Pulaski County, and they really liked the Little Rock port site,” said Chesshir. “They wanted to ensure the local community and governance entities were on board with what they would need from a transportation infrastructure network.”

Amazon commissioned and paid for an engineering study to identify what it would take to make the site suitable for the company needs. The work would be time-sensitive to coordinate with the construction of Amazon’s massive distribution center, valued at $208 million on the property tax roll.

“If we couldn’t guarantee that, we simply would’ve lost the project for the port,” Chesshir said. “By the way, the infrastructure should be completed in May.

“Everyone had to step up. In 90 days or less, we pulled together funding for $11 million in improvements through different city, county, state and federal entities. All of that investment was needed and not just for Amazon. From an altruistic standpoint, it is necessary for the port’s continued success.”

The infrastructure upgrade put in motion by the Amazon project added value to additional land in the Little Rock Port Industrial Park, including a neighboring 80-acre site.

The property was marked free for CZ-USA as part of the incentives to entice the Czech gunmaker to build a $90 million facility and create 565 new jobs. However, an extended deadline to start construction by June 1 is expected to pass with no action by CZ-USA.

“They’ve kicked it down the road,” Day said of the now-indefinite time frame of the project. “They asked us to hold the land for them. We can’t hold that site in perpetuity. We let them know: We want you, and we’ll help you. When you’re ready, we’ll find you 80 acres.

“We’ve had a lot of inquiries since Amazon decided to locate here. There’s so much interest in manufacturing and distribution we need to have all of our land available.”

At the moment, the Little Rock Port Industrial Park has less than 400 usable acres for development. That should change during the next 18-24 months when an additional block of 1,200 acres comes on line.

The property will be open for marketing to prospects once a flight navigation beacon is relocated to a new site north of the Arkansas River.

“It will be one of the largest and best industrial sites in the region, with access to two railroads, on the river, close to the interstate, shovel-ready with utilities and roads in place,” Day said.

During the past 10 years, the city added 1,736 acres to its holdings in the port industrial park through a combination of acquisitions, swaps and options.

Much of that was accomplished through $9.7 million allocated from collections from a 10-year, three-eighths-cent sales tax set to expire at year’s end.

Little Rock Mayor Frank Scott Jr. is advocating the replacement of that revenue stream with a permanent 1-cent sales tax increase. Based on projections, the new tax championed by Scott would generate $530 million over the course of a decade.

“What we’ve been told is that he’s earmarked $30 million for economic development at the port,” Day said. “That money would be used for capital improvements and land acquisition. As this proposal moves forward, we’ll start putting together some priorities on how we would like to use that money.”

While that proposed July 13 special election for the proposed tax increase winds through City Hall, the slow process of transforming wet ground into developable industrial land on a 90-acre site grinds forward near the Little Rock Port Authority office.

Day believes construction of the 30 Crossing project in Little Rock-North Little Rock will generate a welcome abundance of fill material to expedite the project along the west side of Slackwater Harbor Drive south of Industrial Harbor Drive.

“We will have the site filled during the next three to five years,” he estimates.

Day sees the heightened interest in Little Rock generated by the Amazon project as a harbinger for more industrial sites being filled by job-generating developments.