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Strafford approves 220-acre industrial park

With tax incentives, developers are moving forward on rail-access plan

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A group of local developers are moving forward with plans to create a multimillion-dollar industrial park with rail access in southwest Missouri.

The park, dubbed the Southwest Missouri Rail and Business Park, is slated for 220 acres in Strafford near Interstate 44 and the BNSF Railway Co. line.

The project’s five partners – through South West Missouri Rail and Business Park LLC – are John Kramer, Titus Williams and Brad Williams of Williams and Kramer LLC, and Rich Kramer and Bob Kramer of Rich Kramer Construction Inc. 

The group bought the acreage at Route 66 and Highway 125 in July, Titus Williams said, and infrastructure work for water, sewer, gutter, roads, rail and street lighting is expected to cost $18.5 million before the sites are developed. Williams said property acquisition costs were at least $2.2 million.

Developers received a municipal green light from the Strafford Board of Aldermen on Sept. 25 during a special meeting of the board. The board voted 5-1 to approve a tax increment financing plan for up to $13.7 million toward the industrial park.

Economic development officials say there is significant demand for industrial buildings in the Springfield area, and Williams said a project with rail access provides a benefit to incoming manufacturers. Ryan Mooney, senior vice president of economic development at the Springfield Area Chamber of Commerce, said industrial development vacancy is at 2.9%, a jump from the first-quarter 2019 rate of 4.9%.

At the Southwest Missouri Rail and Business Park, Williams said buyers would have the option to build-to-suit or to work with the development group through design-build leaseback agreements.

Available sites are $65,000-$70,000 per acre, with developer cash incentives available, he said. Also available is the Missouri Works program, which helps businesses create jobs and facility expansions through payroll withholdings or tax credits, according to the Missouri Department of Economic Development website. 

Williams said one site is under a purchase agreement with an undisclosed buyer, and another site will be used by the developers to create a speculative building with a summer 2020 completion date. 

During a July 23 TIF commission meeting, project officials said the park development will be funded by $85.5 million in private investment, plus the requested $13.7 million in TIF reimbursements, according to minutes from the meeting furnished by Strafford City Clerk Terri Taylor. Williams later said the conservative private investment cost could double based on the needs of tenants.

The developers say requests for infrastructure bids for sewer, water, streets and rail engineering will be released by fourth-quarter 2019.

Municipal support
The TIF vote came one week after it was first anticipated. Board members postponed a Sept. 16 vote on the plan after two board members, Jeff Larimer and April Stephens, were absent from the meeting, said Martha Smartt, Stafford city administrator.

The board called for a special meeting to discuss the project, which was first introduced Sept. 3.

In addition to the TIF approval, the board supported a redevelopment plan that blighted the property – also a 5-1 vote. Dustin Reed, the 3rd Ward alderman, voted against both requests, saying he didn’t think the property was blighted.

“They weren’t taking it as a greenspace; they were taking it as blighted, that the buildings were rundown and it was unsafe. I don’t see it as unsafe; I just see it as an old fart,” Reed said.

Another of Reed’s concerns was how the city would handle traffic when a train came into town to off-load cars at the park, noting the town already has traffic issues.

“We have to have a cop out here right now on a school morning just to get traffic back and forth,” Reed said. “It’s none of the developer’s doing; we just need to have a plan to address that.”

The board acknowledged the concerns with little discussion. Mayor Ashley French said the industrial park would take a few years to be built out and for tenants to utilize the railway.

Before the vote, Smartt said the project is compatible with the city’s existing infrastructure.

“Strafford has experienced quite a bit of growth in a short amount of time,” Smartt said. “With the I-44 corridor, as well as the railroad that goes through the community, this seems to be very compatible with the infrastructure we already have in place and believe it will help build upon that.”

Williams said the development plan also calls for a 24-unit, multifamily housing component that will create a buffer between the industrial development and Strafford’s residential neighborhoods. He said the housing would be marketed toward people who work at the industrial park. 

Industrial footprint
Two of Springfield’s larger industrial parks are Partnership Industrial Center and Partnership Industrial Center West.

PIC has some rail access – but no available sites remaining – while PIC West has no access to the railway, said Mooney at the chamber.

Mooney said corporate site selectors often ask for rail access when scouting the Springfield area.

“And if we don’t have it, we’re not able to respond,” he said.

Mooney said up to 20% of the roughly 50 leads the Springfield Business Development Corp., the chamber’s economic development subsidiary, receives each year requires rail access. In August, he said the SBDC had received 28 leads so far this year, but only one had turned into a site visit, according to past Springfield Business Journal reporting.

Some PIC tenants are finding ways to gain rail access to the nearby BNSF Railway.

In Phase II of an $18 million expansion, SMC Packaging Group is adding rail siding on the north end of its building to allow the company to receive six rail cars at a time.

“Springfield is struggling as far as being able to provide businesses with rail service,” said Kevin Ausburn, CEO of SMC Packaging, which manufactures corrugated packaging and protective shipping cartons. “It was really one of the reasons we were attracted to this site – because it’s by the rail.”

PIC West was first on Williams’ radar for the Southwest Missouri Rail and Business Park. He said the development company has been working on an industrial park project for two years, starting with exploring expansion of PIC West. Williams said the approval process took too long, and the developers looked to Strafford.

“There’s a shortage in our area for good industrial buildings,” Williams said. “This will fill the need for three to five years. … If we fill this park out, we can do another one.”

Ryan Murray, CEO of real estate firm R.B. Murray Co., said rail access is important but not to all who are looking to enter the Springfield market.

“It’s not the overall driving force of our distribution in Springfield,” Murray said. “We do have manufacturers who need it, but the larger swath of the market doesn’t always command rail.”

Noting the high occupancy rate for industrial space, Murray said a few projects in the works should help absorb industrial demand.

“The demand will drive development, which is what we’re seeing now,” he said.

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