Chamber in Action

Chamber in Action

Targeted Real Estate Redevelopment and Reuse

With the surge in the Texas economy the last few years, vacancy rates have been at some of their lowest in Round Rock since before the recession. Empty buildings across all industries have been snatched up by businesses moving to or expanding in the area from across the nation. Two special-use, vacant buildings, however, that had sat empty for years remained eyesores in Round Rock until a targeted recruitment campaign to fill the facilities finally came to fruition.

The Building with the Safe

The first building was a 46,800 square-foot facility located on more than 9 acres along U.S. Interstate 35, which had formerly housed the National Guard’s local armory division. Complete with a locked safe (in which no one had the combination) and gated weapons rooms, this building required a lot of TLC. A lot. The 45-year old building had clearly seen better days and had been passed over many, many times by companies not willing to take it on.

Then came AirCo Mechanical, an expanding HVAC servicing company looking to relocate out of the City of Austin, but still have interstate visibility and access for their fleet and to increase their customer base. They considered several buildings across the metropolitan area and landed on the old armory building because of its convenient location and access to workforce. The only issue was the capital expenditure required to rehabilitate the old dinosaur of a building into a new regional headquarters for a growing company.

Although a company of this type would not normally receive an incentive for their relocation due to it being outside of Round Rock’s traditional target sectors, the city council agreed it was worth it to fill the building and gain nearly 500 jobs in the community. The week of their grand opening in December of 2015, the Round Rock City Council approved its portion of the incentive package that included economic development grants from the city and chamber, a property tax rebate, and a city sales tax rebate.

The Building with the Body

In addition to the old armory building, Round Rock had an even larger building that had been sitting vacant for more than five years and was owned by Sysco Foods. When they combined multiple facilities into one, Sysco vacated the approximately 200,000 square-foot food manufacturing facility and put it up for sale.

Fast forward a few years and Round Rock city leaders meet ProPortion Foods based in Los Angeles, California. They were looking to combine their two facilities, one of which included their headquarters, and move out of California like so many other businesses. They were adding new lines of product and wanted to be more efficient and profitable.

After looking at facilities across the United States, they decided that the Sysco building was “the one.” In late 2014, they put an offer on the building, only to be turned down by the owners after a developer decided to bid against them. Everyone thought the project was dead, and ProPortion decided to stay in their facilities in California. After all, where else are you going to find an existing 200,000 square-foot food manufacturing facility waiting for you?

A few months later, ProPortion got a call from the broker asking if they were still interested – that the developer’s deal fell through. They were back in the game! After spending most of 2015 in heavy due diligence (which included economic development staff scouring the site for a “human gravesite” that was indicated on the survey – and not finding it), an incentive package was approved by the city council in December 2015 for ProPortion’s move to Round Rock. The package, which was also later approved by the county, included a city property tax abatement, county property tax abatement, and economic development grant.

Although outside of the city’s traditional target industries, the scale of this project from the over $20 million capital investment to the nearly 500 jobs showed an incredible fiscal impact on the community – not to mention filling a building that could have easily sat empty for decades.

Within a span of only a few months, the two buildings that had been Round Rock’s biggest eyesores became the newest projects.