Grove City Record

Grove City, Groveport miss out on Avnet plans to grow

By

Grove City and Groveport will be missing out on one company's growth.

Avnet Inc., a worldwide distributor of computer and embedded technology products and services, plans to consolidate its Columbus region operations by relocating three Groveport facilities and one Grove City facility into one location in Obetz over the next three years.

Obetz Village Administrator Rod Davisson said Avnet will be located in the village's Center Point Business Park off of Toy Road.

"It'll be in a new building that's yet to be built," he said.

In a press release issued by Columbus 2020, Avnet Services Senior Vice President Bill Wentworth said the decision was a "strategic move" as the company invests in the region.

"It makes sense for our employees to be in one location, " he said. "The region is able to accommodate this move with a facility designed for our business and easy access to a workforce to support our business growth."

Avnet plans to add 300 new positions, which is the basis for a job creation tax credit the company will receive from the state, said Patty Huddle, vice president of existing business solutions for Columbus 2020.

"If they don't create the jobs, there is no incentive," she said.

While the agreement has not been executed yet, Davisson said Obetz is offering Avnet a 12-year incentives package worth about $12.1 million. It includes real estate tax abatements, income tax incentives based on the new jobs and discounts on fees.

"It's an excellent deal for the village," Davisson said.

Huddle said Columbus 2020 helped Avnet consider its options when the company decided to consolidate. Originally, she said, Avnet was considering relocating out of the region to meet its labor needs.

"Through our research, we were able to demonstrate (the Columbus region) had the labor they needed," Huddle said. "This is really a great opportunity for Ohio and the Columbus region."

Jeff Green, Groveport's assistant city administrator, said the city was anticipating that Avnet would and expand its locations on Commerce Center Drive and Port Road. At last count, Green said, the company had 300 employees in Groveport and was occupying about 400,000 square feet total.

"We hate to lose them," he said. "Hopefully, we'll have someone moving in as soon as they move out."

Green said there's been some prospective interest in the building but nothing definitive yet. He added he would anticipate a similar electronic or technology company taking the space because the infrastructure and investment in the buildings are perfect for that field.

While losing Avnet is a blow, especially the loss of higher-paying technology and engineering jobs, Green said he doesn't anticipate it will be devastating to Groveport, which he said will have a business vacancy rate of about 4 percent once Avnet leaves.

Green said Groveport had been talks with Avnet about incentives to stay. An existing community reinvestment tax abatement had expired, and the Groveport administration was proposing a 50-percent tax abatement for seven years, Green said.

"We did all we could," he said. "Some things are just out of your control ... and there's no choice but to accept the decision and move on."

The Grove City facility, which houses the Avnet company Round 2, Inc., is located at 3425 Urbancrest Industrial Drive and occupies about 189,000 square feet of office space.

"You never like to lose a company," City Administrator Chuck Boso said. "(But) we don't have a structure large enough in Grove City to fulfill their needs that's available."

According to a relocation letter sent to Boso by Avnet Services Vice President of Operations Timothy J. Harper, the Grove City center, which will be relocated in the first quarter of 2014, has 51 employees with approximately $1.3 million in related payroll.

With Grove City's income tax rate of 2 percent, that would result in an annual income tax revenue of $26,000 for Grove City.

Boso said the city's estimated income tax revenue for 2013 is a bit over $19 million. The loss of Avnet would not have an impact on any city programs or operations, he added.

Boso said Grove City will make the development and real estate community aware of the available space but is confident the property owner, Prologis, will find a market for it.

"Their marketing tools are much greater than ours," Boso said. "Hopefully, someone will move into that facility that has an even greater payroll."

Comments