PORT ST. LUCIE — Costco plans to relocate a distribution facility to Port St. Lucie from West Palm Beach and, city officials said, also may eventually open a warehouse store here.
The identity of the company the city has been courting, to build on nearly 200 acres in Southern Grove, was finally revealed Monday as the City Council approved a package of tax breaks for what had been known as code-name Project Everest.
Major economic-development projects often remain unnamed during negotiations, as permitted by state law.
The distribution facility is expected to break ground in the next six months and be complete about a year after that, according to Jennifer Davis, director of the city Community Redevelopment Agency.
The big reveal
While there had been speculation based on the company's description, Wes McCurry, senior vice president of the Economic Development Council of St. Lucie County, left no doubt during his presentation to the council.
"Now, with great pleasure, I'm proud to announce this company is" ? McCurry said before pausing and flipping to a slide of the company logo — "the distribution depot for Costco Wholesale Corp."
Costco's current distribution center, at 5851 45th St. in West Palm Beach, will close when the new center opens, said Eric Orren, Costo's director of real estate. It is one of just 24 regional distribution depots servicing its more than 800 stores.
"We're looking to relocate our West Palm Beach depot to Port St. Lucie because we've maxed out our growth there," Orren said.
McCurry had previously cited a number of the economic impacts the project would bring. Costco has said the new facility would create 265 full-time jobs with an average wage of $55,350 plus benefits. The Economic Development Council projects economic impact of construction at nearly $85 million, while the impact of the new jobs is estimated at about $198 million annually.
'Working on some other things'
Mayor Shannon Martin stressed that this facility is a distribution warehouse and not a Costco store, but said the city is still "working on some other things" with company, including a possible retail store.
"We're trying, very hard to get a retail establishment here, and hopefully that will happen in the future, but as for right now it's the depot," Martin said.
Orren declined to comment on the possibility of a retail store, saying that those decisions are not under his oversight.
A Costco warehouse store already is under construction in Stuart, with a target opening date of spring 2025.
The depot, in fact, may have an even greater economic impact than a Costco store, Vice Mayor Jolien Caraballo said. When the temporary construction jobs are added to the full-time figure, the total jobs created comes out to about 406, Caraballo said. That compares to about 275 part-time and full-time jobs at a retail store, according to Orren, who said about half of those usually are part-time.
"Potentially, it's even a better benefit than getting a retail establishment at this time," Caraballo said.
Land sale and tax breaks get approval
The Port St. Lucie distribution center is to be located within the city's Southern Grove manufacturing/distribution area, on the largest plot of land within that "jobs corridor." The city acquired that land in 2018. The Costco property encompasses land previously assigned to another code-named project: Project Apron.
City councilmembers, in their roles as the Government Finance Corp., earlier Monday approved sale of about 133 acres to the Costco developer. That land, combined with the land previously designed for Project Apron, make up the roughly 192-acre Project Everest property, located along Interstate 95 just north of existing Amazon, FedEx and Cheney Brothers facilities.
The land was sold by the city to developer JDN Enterprises for about $16.24 million.
The city also approved giving Costco an infrastructure credit of almost $18.7 million to facilitate infrastructure development. Costco is agreeing to pay for infrastructure improvements as part of an agreed "Road Project" in excess of that credit, and plans to borrow $11,357,156.98 to do so, according to the contract.
The city approved a number of tax breaks for Costco. In years one through five, the company would be exempt from all ad valorem taxes. In the sixth year that exemption drops to 90%, then to 80% in year seven, 60% in year eight, 40% in year nine and 20% in year 10. County commissioners are scheduled to vote on a similar incentive package Tuesday.
The city also approved a $3,500-per-new-job impact and mobility fee waiver.
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The County Commission is set to vote Tuesday on a five-year grant of $2,100 per new employee.
A quick turnaround
Conversations about bringing the Costco depot to Southern Grove began in August, said Jeff Greenwalt, Sansone Group national director of industrial development. Sansone purchased the land previously set aside for Project Apron in 2022.
"I called Jennifer Davis and said, 'Hey, we have an opportunity, but we need to move very quickly,'" Greenwalt said.
With the land's inclusion in Project Everest, Project Apron's future prospects seem to be slim. Project Apron was to be a 1.2-million square-foot distribution facility for an unnamed company. In the morning meeting Monday, Caraballo voiced hope that the company could find another site here, but Martin said she was unaware of any other available parcels that size.
"I don't think we have any land left that would fit Project Apron," Martin said. "You snooze, you lose."
Martin thanked those involved in Project Everest for moving more quickly than Project Apron had.
Wicker Perlis is TCPalm's Watchdog Reporter for St. Lucie County. You can reach him at [email protected] and 504-331-0516.
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