web analytics

Laredo: Council Creates 2,000-Acre Industrial TIRZ for 30-Year Project

Feature Illustration: (Clockwise from top) Phase 1-Building 1 rendering from Port Grande marketing brochure; aerial photo of the project site, a former Mercedes-Benz 5-mile test track; site plan for a phased-in section of Port Grande.

Posted: 3-3-2021

by Adolfo Pesquera

Laredo (Webb County) — The City Council on Monday voted to create a 2000-acre tax increment reinvestment zone where the private partner proposes a 30-year industrial development that will grow to more than 20 million square feet at maturity.

At the March 1 regular session of City Council, the council members officially created TIRZ No. 3, which was first introduced by ordinance Feb. 22.

The applicant, Majestic Realty Company (owner of the subsidiary Majestic Laredo Logistics Center LLC), has named this development Port Grande and is already marketing lots for development. The future industrial park is a public-private partnership (P3) and the city and developer will share revenue from the incremental ad-valorem taxes.

Funds going into the TIRZ No. 3 account will be divided at a 55 to 45 share, with the developer receiving the 55%. The developer’s share will be used to get reimbursed for public infrastructure expenses.

The projected infrastructure costs over the life of the TIRZ was calculated at $83,324,325:

  • Water facilities and improvements: $12,498,649
  • Sanitary sewer facilities and improvements: $12,498,649
  • Storm water facilities and improvements: $12,498,649
  • Street and intersection improvements: $36,662,703
  • Utilities and street lighting: $8,332,432
  • Administrative costs: $833,243

(Above) The overall master plan for Port Grande industrial park. (Below) Expanded view of Phases 1 and 2.

The city’s share would be directed to the general fund, but must cover the project’s cost of service expenses.

The exact acreage of the TIRZ, as specified in the agreement exhibits, is 1,914.66 acres. Of that total, the master plan lays out about 1,630.9 acres for development at maturity in 2051, which is also the year that the TIRZ will expire.

Most of the land under consideration is the former Mercedes-Benz 5-mile round test track, which explains its circular shape and the reason the access road is Uniroyal Drive; Uniroyal is the company that built the track more than 55 years ago.

Construction is to take place in seven phases over the three decades. The total area of warehouse storage and related industrial structures is to be 20,285,869 square feet, which amounts to 28.56% coverage. This total area also represent 59 buildings.

The lion’s share of the remaining coverage will be utilized for trailer yards, other parking and hardscaping, and roadways.

Of the 20,285,869 square feet proposed, the developer is committed in the agreement to constructing 14 million square feet of Class A industrial space through the year 2045. Phase 7, which would account for Buildings 48 to 59, is not included in the calculations for incremental value.

Phase 1 (also referred to as Phase 2-Unit 1) encompasses the construction of four buildings (Buildings A, B, C, D). All four are to be completed this year; some construction has already taken place. They total 77,800 square feet (8,800 SF, 15,000 SF, 24,000 SF and 30,000 SF), with a combined value of $3,174,240.

A fifth building is to be completed this year as part of Phase 2-Unit 2. Referred to as Building 3, it will have 308,880 square feet and have a value of $12,602,304.

During the period 2023 to 2025, Phase 2-Unit 2 will bring online another six buildings. The project schedule refers to projected completion dates. It does not specify when each project shall begin:

  • Building 4 at 480,480 SF, to be completed in 2023, with a $20,395,569 valuation.
  • Building 7 at 131,040 SF, to be completed in 2022, with a $5,453,361 valuation.
  • Building 8 at 137,280 SF, to be completed in 2023, with a $5,827,305 valuation.
  • Building 9 at 131,040 SF, to be completed in 2024, with a $5,673,676 valuation.
  • Building 10 at 137,280 SF, to be completed in 2026, with a $6,183,983 valuation.
  • Building 11 at 635,040 SF, to be completed in 2025, with a $28,045,419 valuation.

Port Grande Building Summary, in phases.

The master plan was drafted by Commerce Construction Co. LP of Industry, California.

Majestic Realty Co. is the largest, privately-held developer and owner of master-planned business parks in the United States. It is family owned and has operated since 1948.

Its headquarters are in Los Angeles County, California. The regional offices are located in Dallas-Fort Worth and Laredo, Texas; Denver-Aurora, Colorado; Atlanta, Georgia; Bethlehem, Pennsylvania; Las Vegas, Nevada; Phoenix, Arizona; and Portland, Oregon.

Next Steps:

In the coming weeks, Majestic Realty Co. will be in talks with Webb County Commissioners Court to determine whether the county will participate in the TIRZ.

The terms of the TIRZ agreement also include the establishment of a board of directors. The board shall consist of nine member comprised of City Council member and the mayor. The board is to be assembled by April.

In addition, each taxing entity that levies taxes within the zone and chooses to contribute a portion of the tax increment produced may appoint two members to the board. The board may not exceed 15 members.

By May 2021, the TIRZ board is to have drafted a refined development agreement (including project and financing plan) for City Council’s consideration.

VBX Project ID 2021-1850

Planned phases for infrastructure development at Port Grande.


adolfo@virtualbx.com

Related Images

Anticipated development schedule for Phases 3 and 4

Anticipated development schedule for Phases 5 and 6.

Construction Preview
By |2021-03-03T16:05:04-05:00March 3rd, 2021|Construction Preview, Feature Story|

About the Author:

Adolfo Pesquera (Reporter/Editor) is a veteran news journalist. He has worked for Hearst Corp., American Lawyer Media, News Corp and Freedom Communications. His work has been published in newspapers and magazines across the USA. He is a journalism graduate of UT-RGV. He writes, edits and creates digital pages for VBX.

Leave A Comment