The Zionsville Redevelopment Commission on Monday agreed to sell 15.6 acres in its new Creekside Corporate Park to Hat World Inc. for $577,200—about what the town paid for the undeveloped land last year.
Local incentives tied to the deal, meanwhile, could allow the company to recoup at least half of the purchase price.
Hat World plans to construct a 150,000-square-foot headquarters building on the site, located south of 106th Street and west of Bennett Parkway. The growing company currently is based at 7555 Woodland Drive on Indianapolis' northwest side.
Expected to employ 450 workers within five years, the company’s new headquarters is part of a $21.8 million expansion announced last week. Hat World, which does business as Lids Sports Group, said it plans to add as many as 758 jobs by 2025 between its Zionsville corporate base and a growing Park 100 distribution center.
A Statement of Benefits form filed with the town this week pegs the expected payroll at $23.4 million a year, for an average salary of $52,000. The company estimates that it will invest $16 million in the building and $3 million on equipment.
Zionsville bought 82 acres of former Dow Chemical Co. land for about $3 million in May 2013 in hopes of spurring commercial development in the town, which relies heavily on residential property taxes.
The Hat World deal came together even as officials are working on a master development plan for the property, which straddles 106th Street. The retailer’s multistory headquarters and related parking will take up most of the southern 23 acres; the town will keep about 7 acres there, most of which likely will be used for future drainage.
The Redevelopment Commission also is selling its rights to acquire an adjacent 8.5-acre parcel from Dow. If Hat World does not need the land for a headquarters expansion within 10 years, the town can reacquire the rights.
The purchase agreement approved Monday is contingent on Hat World's receiving all the necessary project permits and development incentives—including a pair of 10-year property tax abatements that must be approved by the Town Council.
Under the terms of the deal, Zionsville will build a deceleration lane on 106th Street, make necessary median and curb cuts, and waive typical road-impact, sewer-connection and building-permit fees. The Redevelopment Commission also pledged to support the tax-abatement requests.
Councilors have the final say on the tax breaks. As proposed, Hat World would pay half of the real estate and personal property taxes levied over the next decade. An estimate of the value of the abatements was not immediately available.
Zionsville also agreed to provide Hat World a “rebate” of up to $250,000 that the community could receive from Indiana’s Industrial Development Grant Fund to build infrastructure at the site.
The Indiana Economic Development Corp. also agreed to provide Hat World with as much as $3.4 million in conditional tax credits and $300,000 in training grants based on its job-creation plans.
The Zionsville land deal is expected to close in May, and Hat World’s headquarters must be occupied no later than June 30, 2016.