Vireo Health plans major expansion
PERTH — Medical marijuana maker Vireo Health at Tryon Technology Park is undergoing a major $55 million expansion, constructing a new 324,000 square foot building for a project to create 180 new full-time jobs.
Vireo Health currently operates a pharmaceutical manufacturing business in Tryon Technology Park. Contractually, the expansion project must be completed by April 1, 2022.
The project was the focus of action and discussion at the Fulton County Industrial Development Agency board meeting last week at the Fort Johnstown Annex. Perth Planning Council is also currently reviewing the project.
The following people made presentations at IDA: Cliff Bedar, vice president and chief operating officer of Cordos Construction of Chicago; and Peter Lilholt, Division Manager for Civil Engineering and Land Services for CT Male Associates Engineering, Surveying, Architecture, Landscape Architecture and Geology, DPC
Officials said steel would start moving in for the project by the end of September.
In response to the state legislature’s recent passage of legislation legalizing the use of cannabis by adults and expanding options for the use of medical cannabis, Vireo Health is proposing a major expansion of its operations in the Tryon Technology Park. Vireo Health is proposing to construct a new 323,982 square foot facility on Lots 1 and 2. The proposed project is expected to create up to 180 new full-time and 10 part-time jobs within two years.
The construction of the project alone should create 250 jobs.
IDA owns the land in the park, where Vireo currently does business for the State of New York, as well as some adjacent land.
“An assessment has been completed,” IDA executive director James Mraz said of Vireo’s proposed expansion site – 336 acres, which consists of 76 acres in Tryon and 260 acres adjacent to the park. . The project will involve the demolition of an existing building.
The IDA voted to authorize the sale of land to Vireo for $1.23 million.
Mraz discussed the distribution of proceeds from the sale of lots — total payments of $153,998 — associated with the Vireo Health project. IDA has entered into an agreement with Cushman Wakefield to commercialize the Tryon Technology Park. The agreement provides that Cushman Wakefield will receive 7% of lot sales on properties sold in Tryon Park. He said that since Cushman Wakefield had not brought the Vireo Health expansion project to IDA, the company had agreed to accept less.
“They offered to accept a 5% fee in this transaction,” Mraz said.
Mraz recounted how the IDA Board previously agreed to provide Fulton County and Fulton County Center for Regional Growth 1 percentage point less than the 7% to be paid to Cushman Wakefield. The IDA board has agreed to provide Fulton County and CRG with up to 6% of the sale of the land in Tryon. It was recommended that the proceeds from the sale of the 43.1 acres of Tryon Technology Park be allocated as follows: Cushman Wakefield — $59,230; Fulton County – $47,384; and the MAF — $47,384.
Payments would be issued at closing.
The IDA Board also authorizes Chairman Joseph Semione to sign an easement agreement with the Gloversville Board of Water Commissioners.
“Right now the lines cross IDA land,” Mraz said.
The Gloversville Water Department owns, operates and maintains the Tryon Technology Park water supply and distribution system, including: a 12-inch watermain that runs along County Road 117.
Mraz said Vireo Health has requested financial incentives through IDA for its expansion. The company submitted a project application for incentives.
The project application requests four financial incentives: Payment in lieu of tax agreement (PILOT); sales tax exemptions — $2.3 million; exemption from mortgage registration tax – $ 560,000; and taxable bond financing Property tax exemptions are estimated at $820,000.
The IDA is due to hold a public hearing into the requested benefits at 10 a.m. on July 1 at the Senior Citizen Center, City of Perth Civic Complex.
Vireo will likely partner with a Real Estate Investment Trust (REIT) to fund this project. The likely REIT is Innovative Industrial Properties (IIP). IIP is the current owner of the facility that Vireo now occupies at Tryon. If so, Vireo would enter into a ground lease with the REIT. IDA and Vireo would then enter into a sale-leaseback agreement with Vireo Health.