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Financial incentives could be on horizon for former Motorola campus in Harvard

City may study creating a new tax increment finance, or TIF, district to cut redevelopment costs

The former Motorola campus has sat vacant for almost two decades, but Harvard Mayor John Kelly thinks the odds of bringing a new active user to the property are much better now that it’s in the hands of a private owner after a court-approved sale last year.

The city is waiting for the new owner to provide some funding, likely $30,000 to $50,000, Kelly said, for the city to pursue a study of the potential benefits and risks of creating a new tax increment finance district for the property.

That financial tool would have to be approved by the Harvard City Council and could provide an avenue for a developer to recoup the costs associated with repairing, improving and bringing the building up to code, or for the city to cover costs associated with getting the property developed.

The property’s new ownership – Las Vegas-based Pinnacle Fund Management, an affiliate of another Nevada group called CAI Investments LLC – has been in talks with large companies about potentially using the space, said Kelly, who estimates it will take tens of millions of dollars in improvements to make its condition usable.

“I do know [the owner] had been involved and speaking with several at least Fortune 500 companies. I think a few Fortune 100 companies they had engaged with,” Kelly said. “But it remains unknown whether or not they will be able to come to a deal.”

The property has been listed as for sale since October on LoopNet.com in a post, which advertises that its 1.5 million square feet could be used as a fulfillment and manufacturing facility, and accommodate a single tenant or multiple.

Attempts to reach Matthew Tucker, a CAI Investments representative, were unsuccessful this week, but Tucker previously told the Northwest Herald that the new owner hopes to redevelop the property for future tenants.

“We are very excited to work with the city and local community to find the highest and best use,” Tucker said in September. “Right now we are exploring solar power solutions and plan to redevelop the space and plac[e] a tenant in that will create jobs and generate tax revenue for the local economy.”

Another company that considered buying the property last year and had it under contract until its deal fell through, Green Data Center, remains interested in potentially occupying the space, CEO Jason Bak said.

It had planned to add solar power generation there and use it to fuel a data center, with the hope that other businesses may want to locate in the facility to be close to such power and computing infrastructure, Bak said.

Green Data Center is “in discussions” with the new ownership, he said. Green Data still making a purchase is “one potential route” and would use it for a data center.

“We see the opportunity for multiple tenants,” Bak said in a text message. He declined to say why his company’s previous deal to buy it did not close.

One challenge any developer would face is the significant costs required to reactivate electric power to the facility, which utility ComEd said it is working on with the current owner CAI Investments, Kelly said.

The site is at the edge of ComEd’s service territory and the utility has a substation about 15 to 20 miles away that could feed it more electricity, but it’s still too early to estimate costs for such a project to hook the campus up to it.

“We are actively engaged with the new owners of the former Motorola site in Harvard to understand their future energy needs, and how ComEd can support the efforts to bring new jobs and investment into this community,” ComEd spokeswoman Lauren Huffman said.

Once CAI provides the city some funding to start an analysis of creating a TIF district, Kelly said, it could be several months until the report is completed and then could take as many as six to 12 months for the city to form a new TIF.

Kelly said he is ambivalent about whether the ultimate end-user of the property creates loads of new local jobs, as he supported Green Data’s proposal.

State Rep. Steve Reick, a Republican whose district includes Harvard, had concerns about the project since solar fields and data centers don’t require many employees once they are built. That gave him pause in considering whether to push the state to grant any tax incentives to the Green Data use, Reick said.

“Our main goal is to bring the property into compliance and utilized for business. I would be over the moon if it was a manufacturer that brought thousands of jobs to the city,” Kelly said. “But I’m also realistic in knowing the property sat empty for many years. While it’s had a lot of shadows over it, we have to wait and see who’s willing to pony up and make that investment in Harvard.”

“Maybe the answer is, much like what Green Data brought the table, several entities that come to property and you get a synergy versus an all-or-nothing,” he said.