Batesville Herald Tribune, Batesville, Indiana

November 12, 2013

Developer selected for shell building project

Debbie Blank The Herald-Tribune
The Batesville Herald-Tribune

---- — The recession stalled one of Batesville leaders’ big ideas, but now the urge to construct a shell building to attract a new industry here is more definite. A developer who will explore whether the project is feasible was approved at a Batesville Economic Development Commission special meeting Nov. 9.

Members actually met twice about the issue. Due to an unintentional violation of Indiana’s Open Door Law – a fax was sent from the mayor’s office to The Herald-Tribune, but never received – a vote at the Nov. 1 BEDC meeting was invalid.

Before members talked about which firm should be chosen, at the first meeting they discussed where the building would go. There were two choices, land near Batesville Commerce Center originally intended for an Ivy Tech Community College structure; and a lot, not yet determined, at the vacant 73-acre industrial park on the east side of Merkel Road and south of I-74.

Caran Siefert, 114 Chateau Blvd., attended the meeting because his home is near the first choice. “We’re a little bit concerned. We don’t want a heavy manufacturing plant right in our backyard.” BEDC member Gene Lambert maintained, “A heavy manufacturing facility has no purpose going into that spot. It would be one of our last choices. We see that particular area for more of a life science (building) … a tech park.” Lambert added he doesn’t want a factory “wedged between St. Andrews (Health Campus) and a retirement community. It’s not community planning.”

BEDC President Andy Saner reported on two October days, members met with representatives of four developer/construction firms “to start homing in on the best group to partner with in helping to assist us in defining what this project should look like.” The firm had to meet certain criteria: “previous experience; capability for construction manufacturing; planning infrastructure experience; qualified design partners”; financing; marketing; and, “one of the most important pieces, their willingness … to work with local contractors.”

The quartet in the running: Garmong Construction Services, Terre Haute; Runnebohm Construction, Shelbyville; GM Development, New Castle, partnering with Axis Architecture, Indianapolis, and Bruns-Gutzwiller, Batesville; and Maxwell Construction, Greendale.

They discussed specifics about each presentation. Saner said he liked “the ease of communication” with the GM Development group. Owner Greg Martz would oversee project management, marketing and financing; Axis Architecture would design the building; and Bruns-Gutzwiller would be in charge of construction and design management. Axis has designed shell buildings for three other cities and he noted Bruns-Gutzwiller’s reputation is “extremely solid throughout the state.” Saner said Martz told the panel “Batesville had the best all-around package to offer” to prospective companies if it’s able to combine the appealing community with a new, vacant building.

Runnebohm Construction has completed shell buildings in Shelbyville and Rushville. Its proposal would require the city to deed over the property to the firm.

Maxwell Construction didn’t offer a financing option, recommending that Batesville get the needed money through state funding and a TIF district. While the company did just land a huge deal, the $37 million five-floor wheat mill in West Harrison, of constructing a shell building, Saner said of the four in contention, “I think they’re newest to this type of opportunity.”

According to him, “Garmong Construction Services, which would require upfront fees, is “very reputable. Everybody was pretty impressed with the presentation.”

The president said, “I’m not sure we could really go wrong with any of the partners. Through a lot of different discussions … and time … at least I am prepared with moving forward with selecting a partner.” He believed a developer is needed to help finalize a building design, estimate the cost, decide on the best location, mull financing options and put together a marketing plan.

Batesville Industrial Park Commission President Dale Meyer asked if a contract is signed with a developer, “are we obligated to move forward regardless of cost?” Mayor Rick Fledderman said the financing would have to be worked out. “It’s the real key.” Saner pointed out that “if, at the end, we can’t afford it,” consultant’s fees would be paid.

Meyer said he didn’t want to sign a contract until financing is secured. Saner reported, “I do feel confident we’ve got funding to cover this project.”

According to Lambert, Martz “requires no money up front. His fee is included in the loan that he secures on our behalf for the project. He gets 6 percent, held in escrow until we sell or lease the property … they do some of the construction. They contract out a lot of the construction.”

Meyer asked city consultant Vicki Kellerman if Martz has a better marketing program than the others. She answered, “He’s willing to work with us” to incorporate items into the marketing plan.

Saner announced, “I’ve got one in mind and I think my mind’s made up.” He favored GM Development, collaborating with Axis Architecture and Bruns-Gutzwiller, as the developer because he felt Martz is “ambitious, hungry. All those things work to our advantage. I think we’re going to get a lot of attention, energy and focus on our project … I think time is a real scarce commodity and he would afford us more of his.” The mayor agreed, “I have no doubt he will steer us in the right direction.”

Two meeting attendees who are not part of the commission and could not vote were asked for feedback beforehand. The mayor observed, “Greg has a lot of financing experience from his days with Keystone Development.” Meyer reminded that even though Bruns-Gutzwiller will be involved in construction management, it doesn’t mean the firm has a lock on the actual structural work. “We (will) get competitive bids.”

In addition to Saner and Lambert, the other three BEDC members (Dennis Harmeyer, Bill Flannery and Lori Feldbauer) voted to go with GM Development. Saner thanked attendees for all the additional time they’ve put in to interview project candidates. “With some focus on a partner … I think we’ll be able to move forward here a little faster.”

Saner will invite Martz to the next BEDC meeting, which is one week later than usual, Nov. 22 at 8 a.m. in the mayor’s conference room, to start working on a timeline. He predicted this exploration phase would be a six- to nine-month process. At the earlier meeting, Kellerman suggested, “Don’t forget covenants” for the new industrial park.

New community development director Sarah Lamping said Nov. 1 she is researching how other communities got the word out to companies about their shell buildings. She asked the group to help prioritize her work tasks “as we move forward with this project.”

Lambert noted, “We voted to select a developer to work with. We have not voted on location, that we’re moving ahead with the shell. We’re moving ahead with the process. We still have facts to gather.”

Debbie Blank can be contacted at debbie.blank@batesvilleheraldtribune.com or 812-934-4343, Ext. 113.