Hilliard poised to sell data-center-zoned land to Amazon

A. Kevin Corvo
ThisWeek group
On Oct. 12, the Hilliard City Schools board approved an option-to-buy contract with the city of Hilliard for 20 acres on the 124-acre Grener tract. The rest of the land – about 104 acres – already was sold to the city in 2014. The city intends to sell the acquired 20 acres and 84 acres it already owns to Amazon Web Services for a data center.

Hilliard City Council is expected to vote Monday, Nov. 9, on legislation that would authorize City Manager Michelle Crandall to enter into an agreement to sell more than 100 acres of the Grener tract to Amazon Web Services for a data center.

During that meeting, council members also are expected to vote on the city’s purchase of 125 acres near Roger A. Reynolds Municipal Park for recreational purposes.

Three ordinances and two resolutions, all related to the two real-estate transactions, were introduced at an Oct. 26 meeting.

All three ordinances were held over for a second and final reading and public hearing Nov. 9.

Both resolutions were approved in 7-0 votes.

Two other pieces of legislation, both to amend local Community Reinvestment Act agreements associated with Amazon Web Services, will be introduced at future date, said David Meadows, Hilliard's economic-development director.

“We’ve had a lot of discussion about this in executive session,” council President Andy Teater said after Meadows outlined each of the proposed real-estate transactions Oct. 26.

Coinciding with the proposed sale is the purchase of 125 acres east of Alton Darby Creek Road and south of Scioto Darby Road – adjacent to the Reynolds park and the Hilliard Ohio Soccer Association complex – for $4.41 million.

The land is known as the Jerman property; it is named for the family that owns it.

“If City Council approves the (Amazon) purchase, then the city will buy the Jerman property,” Meadows said.

Earlier in October, the city moved to acquire all the land on the Grener tract, which also is named for the family that once owned the 124 acres between Cosgray and Leppert roads and south of Hayden Run Road.

On Oct. 12, the Hilliard City Schools board approved an option-to-buy contract with the city for 20 acres it still owns on the 124-acre Grener tract. The school district previously owned the entire tract, acquiring it in 2003 for $50,000 per acre from the Grener family as a potential site for Bradley High School, but it sold most of it – about 104 acres – to the city in 2014 for about $4 million.

As part of the pending purchase, the city would pay the school district $2.8 million for remaining 20 acres it owns and add it to 84 acres the city owns, Meadows said.

City Council on Oct. 26 approved a resolution authorizing Crandall to enter into a real-estate option with the school district for the 20 acres.

Amazon Web Services then would purchase all 104 acres from the city for $14.76 million, Meadows said.

The three ordinances introduced Oct. 26 authorize the sale of the Grener property, authorize the issuance of notes not to exceed $1.5 million for acquiring the property and appropriate funds for the purchase of the Jerman property.

The Grener-tract sale would expand Amazon’s data-center footprint in Hilliard.

The city had planned to build the Grener Sports Complex on the site, but earlier this year, after a study indicated it would cost about $38 million to build out the complex, officials opted against it.

Previous story:Miracle Field could lead off Hilliard’s Grener sports complex

Crandall said in July that Hilliard lacked the financing to advance development of the Grener tract for recreational purposes in the near future, but a data center would be “a good secondary use" for the 104 acres.

On July 13, City Council rezoned the 84 acres of the Grener tract owned by the city and the 20 acres owned by the school district from a sports-facilities district to a planned-unit-development district that would allow a data center. The other 20 acres purchased by the city in 2014, including the land for Bo Jackson's Elite Sports, 4696 Cosgray Road, were not included in the rezoning.

Previous story:Hilliard council gives OK to set Grener land up for data center

At the time of the rezoning, no buyer for the land was mentioned.

The proposal by Amazon to build a data center on the Grener site stemmed from “ongoing conversations” the city has with the company as a current corporate client, Meadows said.

Amazon already has three data-center facilities at the southeast corner of Britton Parkway and Hayden Run Road.

A fourth is under construction, and Amazon has approval for the construction of a fifth facility, Meadows said.

Amazon’s investment in the proposed data center on the Grener tract is expected to be $200 million, according to Meadows.

It would create 100 new jobs with an annual payroll of $8 million, he said.

The school district would receive annual revenue of about $2 million as a result of the project, Meadows said.

Crandall said the Amazon proposal is “a great opportunity to increase the city’s income-tax revenue and will be a significant property-tax source for the school district,” all while having a minimal effect on the city’s infrastructure.

The agreement between Amazon and the city calls for the completion of “due diligence," approval of a final site plan and closing within 270 days of the approval of the sale, but it does not require construction to begin on any given date, Meadows said.

“The intention is to build (data centers), but if they buy and don’t build, it’s a company decision,” Meadows replied when asked by council member Les Carrier how soon construction is expected.

When asked about the project, Lauren Lynch, a spokeswoman for Amazon Web Services, said, “AWS has a practice against commenting on our future road map.”

Jerman-property purchase

After the July rezoning, City Council approved a resolution that stipulates 75% of the proceeds from the sale of the Grener tract would “be dedicated to parkland acquisition, development and associated infrastructure.”

The city cannot use proceeds from the sale of the Grener tract to Amazon Web Services because of the simultaneous transactions, but after that sale is final, the city would use the proceeds to pay down any debt on the purchase of the Jerman tract or purchase parkland or associated infrastructure according to the terms of the resolution, according to David Ball, Hilliard's director of communications.

The city will use a combination of funds, including bonds, to purchase the Jerman tract for $4.41 million, Meadows said.

“The Jerman purchase allows the city to deliver on the promise made when the Grener tract was purchased,” Crandall said.

The community also will be involved in determining how the Jerman tract will be developed, Teater said.

In addition to expanding the city’s recreational opportunities, the purchase of the Jerman tract facilitates the city’s desire to extend Cosgray Road south of Scioto Darby Road to connect to Alton Darby Creek Road, Crandall said.

That project, coupled with the lack of a sports complex, would allow the city to forgo improvements that otherwise would have been required to Leppert Road, said Letty Schamp, Hilliard’s deputy engineer.

kcorvo@thisweeknews.com

@ThisWeekCorvo