The project would allow the west-side community to compete against cities in Utah and other states for bigger companies that need large spaces, according to Mark Nord, a West Valley City business development manager.
"In economic development, our biggest handcuff has been inventory, and now we're able to go out and get aggressive," Nord told council members recently. "We can't go after them (businesses) when we have nowhere to put them."
Councilman Steve Vincent predicted the project will be an economic boom for West Valley: "I think this is a great project and opportunity for our city."
Under the proposal, new construction would be spurred by creation of a economic development area, with special tax incentives for private companies willing to build within its boundaries. If approved by the council, the Northwest Economic Development Area (EDA) would span 959 acres roughly from 7200 West to almost 5600 West and 2100 South to 2700 South.
Developers in an EDA would be eligible to receive tax increment, giving them a piece of the additional property taxes generated from increased value of properties they develop or improve, allowing them to offset a portion of their costs.
There are 183 parcels owned by about 100 landowners within the proposed development area.
Council members, sitting as the Redevelopment Agency board, voted unanimously on Oct. 23 to approve the Northwest EDA plan. Their upcoming vote on the proposal, in their capacity as council members, is likely to be a formality.
The EDA's tentative budget includes $41.6 million of tax incentives but that figure would drop if construction falls short of current projections. The EDA would be dissolved in 2027 or sooner, depending on how quickly development proceeds.
Private companies Freeport West and Millrock Capital are ready to build, with plans between them to invest a combined total of $340 million in the next 10 to 15 years in developing 4.1 million square feet of industrial space in the EDA.
Freeport West, a Salt Lake City-based company that owns and manages more than 7.3 million square feet of industrial properties, plans to construct 2.3 million square feet of industrial and manufacturing space on a 130-acre parcel adjacent to the Rocky Mountain Raceway.
Freeport's plans call for construction of the 633,000-square-foot building which, at the size of about six Walmarts, would be the largest industrial building in West Valley City. That construction would begin next spring or summer and be completed by the end of 2013.
Five additional buildings one with 17,000 square feet and the others ranging from 392,000 square feet to 497,000 square feet would be built over the next five to seven years.
Brad Ross, Freeport West's executive managing director, said big space draws big businesses. The company recently leased 1 million square feet at its Landmark Industrial Park in Salt Lake City to Sun Products Corp.
"Our niche is building these big buildings," Ross said. "We've had a lot of success in Salt Lake. We expect the same success in West Valley."
Millrock, which developed and owns the Millrock Park commercial office complex in Holladay, plans smaller buildings ranging from 50,000 square feet to 200,000 square feet on about 78 acres, according to West Valley City business development manager Keith Morey.
The range of sizes "creates a good combination of opportunities that don't compete against each other but address a market need for much larger tenants and smaller tenants as well," Morey said.
Jonathan Springmeyer, vice president of Bonneville Research, a consulting firm that helped West Valley set up the EDA, said the new Freeport and Millrock facilities are projected to bring in 6,274 jobs.
Springmeyer stressed that these kinds of economic development areas cannot condemn land, issue bonds or levy additional taxes. The only changes in the city's tax structure would be caused by increases in the value of the land, he said.
West Valley City Council members will vote Nov. 6 on whether to create a 959-acre Northwest Economic Development Area, which would use tax increment funding to offset costs of building industrial and manufacturing space there. The council will meet at 6:30 p.m. at City Hall, 3600 S. Constitution Blvd. (2700 West).