By the numbers
$15 million invested in the park since its conception
$1.6 million sale price for Nextedge Applied Research and Technology Park
214 total acres
170 acres now owned by the Community Improvement Corp.
200 approximate number of jobs at the park
7 companies located at the park
The story so far:
2004: City and chamber of commerce decide to seek a technology park.
2006: Developers break ground on the park for Avetec and Mills-Morgan Development, the first tenants after the already constructed LexisNexis.
2008: Avetec and Mills-Morgan buildings are completed. Qbase signs on to move into Mills-Morgan.
2009: Nextedge begins to see financial problems and falls behind on property taxes.
2010: The Turner Foundation steps in to ease the $1.2 million debt at NextEdge.
2011: The Turner Foundation backs out of financing NextEdge and Fifth Third Bank takes over the property. In November, the bank attempted to sell the property for $3.8 million but the sale didn't go through.
2012: The Community Improvement Corp. purchases the park from the bank for $1.6 million in August.
The chamber of commerce’s development arm has purchased the technology park on the city’s eastern edge for $1.6 million, a fraction of the money invested in it.
The Community Improvement Corp. bought about 170 acres out of the 214-acre Nextedge Applied Research and Technology Park from Fifth Third Bank at an auction of the property in August, but the sale wasn’t finalized until this week.
The Greater Springfield Chamber of Commerce financed the purchase because it was a good price for land that already has seen nearly $15 million invested in federal, state and private money, said Mike McDorman, chamber president and CEO. That includes $6.3 million in public funding for the main infrastructure of the technology park.
“At the end of the day it was not the perfect time for us to get back into the tech park business, but we felt that the price was right for what had already been invested and we needed to take the mitigated risk,” McDorman said.
Having the property in local hands will make it easier to market, said Tom Franzen, city economic development administrator.
Nextedge has seen years of trouble since the economic downturn hit the technology sector that the park was meant to target.
The park was developed in 2004. By 2010 the debt and cost of maintaining the property became too much, and the Turner Foundation stepped in to assist but then later pulled its funding. Fifth Third Bank took over the park and attempted to sell the land in November 2011 for $3.8 million with the hopes of recouping some costs but the bank was unable to do so.
The bank finally auctioned the property in August, recouping less than half that amount.
While local officials admit that the the economy is still slow for tech companies, some signs point to a potential rebound.
“We’ve had a slight increase in interest, just primarily from the data center market since it’s started to pick up just from the general economic condition,” Franzen said. “Folks are starting to look again for that type of space.”
Currently Nextedge has seven companies operating there — SAIC, Qbase, Avetec, Reed Elsevier/LexisNexis, Newport Spectra Physics, Pallas Systems and Zia Systems — that account for nearly 200 jobs.
The property the chamber purchased includes 50 acres of developed land that can be marketed immediately, McDorman said. The rest of the land is empty.
Avetec, which couldn’t be reached for comment, owns its building and Mills-Morgan Development owns another. Those properties aren’t part of the sale.
The CIC’s purchase of the park will help Mills-Morgan attract more tenants to its building, said Todd Duplain, director of development for Mills-Morgan.
“The more people we have pulling for that park and the more local people we have putting efforts and investment toward it, the better (off) we’re all going to be,” he said.
With a bank as an owner, it can be difficult to get answers and information quickly and easily to interested parties, Franzen said. Now that the chamber owns it, the process of working with businesses and marketing the site will be expedited.
McDorman said the purpose of the park remains the same: to attract higher paying jobs in the technology and research area.
“The bottom line is we need to work with the community to develop a master plan that will help us build some short and long-term successes for the site,” McDorman said. “Nextedge is a regional asset that we could not afford to lose.”
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