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  • Supervisors approve lease for Caterpillar

    Jun 07, 2016 | Read More News
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    The Pima County Board of Supervisors on June 7 voted unanimously to approve a lease agreement with Caterpillar

    CaterpillarThe company plans to lease the county-owned building at 97 E. Congress, which formerly housed the Regional Flood Control District and Pima Vocational High School. Regional Flood Control has moved into the County-City Development Services Building, 201 N. Stone Ave., and Pima Vocational High School will move to the El Pueblo Neighborhood Center, 101 W. Irvington Road. 

    The lease term for 97 E. Congress is four years with two, one-year options. Caterpillar will pay the County an annual lease rate of $13.72 per square foot of occupied space and $7.12 per square foot of unoccupied space, payable in equal monthly installments.

    Caterpillar will initially lease approximately 20,000-square-feet of office space on the second and third floors of the building. By late 2016, Caterpillar intends to lease the remaining space, totaling 41,000-square-feet. 

    The County plans to spend $2 million on facility improvements at the building while Caterpillar has agreed to repay 30 percent of the capital tenant improvement costs over the four-year period. That amount is equivalent to the depreciated value of the tenant improvements over the same period. 

    Caterpillar also agreed to pay all operating and maintenance costs associated with the building, as well as the standard government property excise fees. Pima County will provide up to 200 parking spaces in the adjacent County Legal Services Garage. 

    This lease agreement with Caterpillar was done in accordance with the economic development goals enumerated in Action Item 11.2 of the Board of Supervisors adopted Economic Development Plan, which seeks to expand primary employment in the downtown area. 

    Caterpillar plans to utilize 97 E. Congress as an interim facility. The company will eventually relocate to a significantly larger facility Rio Nuevo will build west of Downtown and then lease to Caterpillar. 

    Last month, the Arizona Commerce Authority, Pima County, the City of Tucson and the Rio Nuevo Multipurpose Facilities District announced the finalization of economic incentive package for Caterpillar. The company intends to relocate as many as 650 high-wage and highly skilled jobs to Pima County. Caterpillar already employs 350 people at the Caterpillar Proving Grounds south of Green Valley. 

    The total value of the 10-year economic impact of Caterpillar is estimated to be $1.9 billion, with total new annual tax revenue of $69.6 million ($39.7 million local and $29.9 million state).

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