The city of New Albany has created an incentives package to assist in the timely development of an extension of the Water's Edge development on Walton Parkway.

The city of New Albany has created an incentives package to assist in the timely development of an extension of the Water's Edge development on Walton Parkway.

The three-phase project is expected to create at least 340 jobs, according to an April 12 legislative report from city manager Joe Stefanov to Mayor Sloan Spalding and council members.

The Water's Edge offices are at full occupancy, economic-development director Jennifer Chrysler said, and other multitenant facilities in the New Albany International Business Park are at about 90 percent occupancy.

That lack of space meant the city wasn't able to answer many inquiries for companies interested in office space, Chrysler said. Most of the city's revenue comes from its income-tax collections, city spokesman Scott McAfee has said.

As a result, Daimler Group and the New Albany Co. began thinking about how to extend the Water's Edge campus.

The 15-year blanket tax abatement on the entire Water's Edge campus was one of the reasons the city has been able to be so aggressive in filling the office space, Chrysler said. It was able to market the buildings before they were even under construction.

"There certainly was a great opportunity to use the incentives as a package for that property in order to attract great Class A office buildings," Chrysler said.

City Council approved the incentives April 19.

The agreement is similar to the first Water's Edge campus agreement, according to the report. The deal swould provide the New Albany Co.-Daimler Group joint venture a 100 percent real property-tax abatement for 15 years if all three phases are built within the first seven years of the agreement. If that goal isn't met, the incentive term would be reduced to 10 years per building.

"The idea is that we want to encourage as much Class A office development as possible," Chrysler said, especially in the New Albany-Plain Local School District.

The tax abatement allows a lower rent to be offered to building tenants and brings corporations to New Albany that might otherwise go elsewhere, generating income-tax revenue for the city, Daimler Group president Bob White Jr. said.

Construction of the first phase will begin in early to mid-June and will conclude in June the following year, he said.

Each of the three facilities will be filled speculatively, White said. No businesses have been identified for the first building.

The land for the entire three-phase project includes three parcels: one at the southeast corner of Walton Parkway and state Route 605 and two on Walton Parkway east of the Signature Office Building, according to the legislative report.

The report outlines the three phases as follows:

Phase 1: Two-story office building with a total investment of more than $8 million, expected to create at least 150 full-time jobs with an annual payroll of at least $6,750,000.

Phases 2 and 3: Two-story office buildings with an estimated investment of $5.6 million to $8.7 million. Each phase is expected to create at least 95 full-time jobs with a minimum payroll of $4.3 million.

Phase 1 is expected to annually generate: $40,000 for the NACA infrastructure fund; $46,900 for New Albany-Plain Local schools and $46,900 for the city's general fund.

Phases 2 and 3 are each expected to annually generate: $25,800 for the NACA infrastructure fund; $30,100 for New Albany-Plain Local schools and $31,100 for the city's general fund.

The three existing Water's Edge office buildings generated a total of $1,060,427 in income taxes last year, city spokesman Scott McAfee said. The city and the school district each received $371,149 from that total, and the International Business Park's economic-development fund received $318,128.

Water's Edge I was completed in the first quarter of 2009, and the first tenant moved in July that year, White said. Commitments for nearly all the spaces came within six to eight months later.

The first tenant for Water's Edge II moved into the building in November 2012, and most tenants moved in over the course of a year, White said. A tenant for the entirety of Water's Edge III -- Columbia Pipeline Group -- was identified midway through construction, and the company moved in in July 2015.