A company "Project Coffee" is exploring locating in the Southwest Distribution Center located at 7070 Cretex Avenue in the east side of Shakopee.  This building has been vacant for more than two years.  The original proposed tenant withdrew from a lease for the entire building when the pandemic struck and the building has sat as a shell since that time.  The building is still in shell condition waiting for a tenant for up-fit.

The building's owner, Southwest Logistics Center, LLC (WPT Capital Advisors) of Minneapolis has had the building on the market since then.  Recently, it was approached by a user that would bring more than 100 jobs that would meet the city's required average wage of $24 per hour plus benefits.  

The building paid $211,638 in taxes for 2022 and will be paying $715,006 for 2023.  The city's portion in 2023 will be $90,009.  The business subsidy proposal is to provide a tax abatement only for the potential tenant's improvements, which are estimated to be between $8-$10 million.  The city would continue to receive the existing building portion.  The city would also collect approximately $100,000 in building permit fees in 2023 for the possible tenant up-fit.

The building owner has had several lease proposals but none of these have been able to be executed because the building does require substantial tenant up-fit and the current taxes on just the existing building are more than $1.41 per square foot. Given the current market uncertainties and cost of funds, tenants have not been willing to front the up-fit costs.

This building is in the XCEL service territory.  They have been marketing the building along with the owner through its economic development group.  If this tenant moves forward, they will be working with the potential tenant on building energy saving installations.