The long-rumored move, dubbed “Project Tango” will be the fifth such center in Indiana. The online retailer ’s 1-million-square-foot distribution center is already under construction in River Ridge Commerce Center, along Ind. 62, and it is expected to be open this fall.
“ We re absolutely glad we got the formal announcement today,” said River Ridge Executive Director Jerry Acy. “[It’s] what we consider a quantum leap in development.”
Rumors were rampant that the 70-acre site in River Ridge was being developed for Amazon.com, but officials from the company would not confirm its plans. Construction began several weeks ago to prepare the site — 16 acres of which belonged to River Ridge and was sold for $450,000, Acy said.
The remaining 54 acres was owned by Crossdock Development. Calls made to Crossdock Development President Lee Wilburn were not returned as of press time.
The Jeffersonville facility is expected to bring about $150 million in investment to the new site by 2015, along with the jobs, according to an Amazon press release.
Amazon Spokeswoman Michele Glisson said in an email, seasonal jobs will be in addition to the more than 1,000 full- time employees eventually set to be hired at the “fulfillment center,” as Amazon refers to it. She did not provide information on average wages for workers when asked or when applications will be accepted, only that more details will be available later this year.
“ The company is employing thousands of Hoosiers, ” said Indiana Gov. Mitch Daniels in the release. “ We’re grateful for every one of those jobs. These facilities will serve customers across the country, further cementing Indiana ’s position as the country’s logistics capital.”
Tax incentives
To help entice the company to locate another distribution center in Indiana, the Indiana Economic Development Corp. offered the retailer conditional tax credits. The company’s other Indiana facilities are located in Indianapolis, Whitestown and Plainfield.
Amazon can receive up to $2 million in conditional tax credits and up to $ 300,000 in training grants based on the company’s job creation plans, according to the press release. These tax credits are performance-based, meaning until employees are hired, the company is not eligible to claim incentives.
Also at ssue for t he state is an agreement forged earlier this year between Daniels and Amazon. Daniels announced the retailer will begin collecting Indiana’s 7 percent sales tax from customers in 2014, which could lead to Indiana getting at least $20 million more in annual sales tax revenues. The agreement follows a lawsuit by Indianapolis-based mall owner Simon Property Group against the state. Traditional retailers have lobbied to end what they call an unfair price advantage for all online retailers.
Glisson also did not offer an estimated amount of annual sales tax revenues that will be generated by the Jeffersonville fulfillment center when asked.
River Ridge Development Authority approved an additional property tax abatement through the enterprise zone and will support infrastructure i mprovements, including ongoing plans to install a traffic light and extended turn lanes at the intersection of Ind. 62 and SalemNoble Road and improvements to Cox Street — a connector road.
The Economic Development Corp. and the Indiana Department of Transportation will allocate funds to i mprove Cox Street, and Acy said that is expected to be complete by August. The Salem-Noble Road improvements are expected to be complete before the fulfillment center is open.
He added the timeline for the building’s completion has not changed. By July, the outer portion of the structure should be constructed with a final completion date set for October.
“We’re glad to see construction progressing rapidly out here,” Acy said.
In addition to the warehouse space, plans for the site include 50,000 square feet of office space, said John Bancroft, senior vice president of KTR Capital Partners, an investment company affiliated with the project. The plan also shows 64 designated dock-loading spaces along the side of the warehouse and up to 2,584 parking spaces that would be available once two phases of parking construction are complete.
Waivers allowed by the Jeffersonville Planning Commission allowed for all the parking to be located on the side of the building. Ordinarily, only 70 percent of parking can be located in a new development’s side yard. Another waiver allowed for slightly smaller loading docks than is normally required along with a waiver that allowed for fewer trees than is normally required to be planted as a buffer.
Triggering a boom?
What local officials are hoping for is the announcement that Amazon is locating in River Ridge is the start of a host of activity at the former Indiana Army Ammunition Plant.
“Their presence here is further testament of River Ridge being the Midwest’s premier development site, ” said Mark Robinson, president of the River Ridge Development Authority, in the release.
Acy said after the groundbreaking for the project originally took place, discussions began to locate another business on the opposite side of the Cox Street connector road. The proposal would be to construct a 400,000-square-foot warehouse manufacturing or distribution center with related offices on 26 acres, but Acy would not comment on who is seeking to develop the site.
“This is huge news for not only Jeffersonville, but for Southern Indiana and metro Louisville. ” said Jeffersonville Mayor Mike Moore. “I think it’s going to be a domino effect,” he said for development at River Ridge.
Along with the continued expansion at River Ridge, construction of the east-end bridge is expected to have a major impact on the city.
“Something of this scale is going to have ramifications beyond the jobs Amazon is going to bring,” Moore said. “It’s going to create much more growth than just those jobs.”
He said he believes the company will have an impact on support industries around Amazon, restaurants and retail stores in the area and may also contribute to growth in the residential base for the city.
Other locations
Plainfield Chamber of Commerce Executive Director Brad Dubois said the two distribution centers located in the town — on the southwest side of Indianapolis — employ about 1,200 people. He said he did not have a measurable impact the company has had on the community.
“I’m certain it’s helped the commerce around [the fulfillment centers] ” he said. “ With that many people, it’s bound to have an effect.”
He added while he thinks the company has been great for the economy, they have not responded to his efforts to determine a more measurable economic impact on the area and admitted that the number of employees is just an estimate.
The same reason the company chose to locate fulfillment centers in Plainfield was also the reason for choosing Jeffersonville.
Moore said one of the major incitements for locating in Jeffersonville is the logistical location and the infrastructure support around the area. In addition to east-end bridge, which is in the planning stages, there is immediate access to railroads, the Clark Regional Airport is a few miles from the fulfillment center ’s location and the Port of Indiana-Jeffersonville provides nearby access to major inland waterways.
“We’re ripe for the picking; we’ve just got to make sure we’re doing what’s right for Jeffersonville, ” Moore said. “ It’s about to take off.”