Project Number: 20191202
Pilot Type: Jobs
Status: Approved
Parcel ID: 043047 00014
County Commission District: | City Council District:

Summary

Penn A Kem LLC (“Applicant”) was approved for a twelve-year Jobs PILOT to enable the company to create 28 Net New Jobs and invest $38,545,000 in the City of Memphis at 3324 Chelsea Avenue.The total project investment includes $31,345,000 for new personal property and $7,200,000 for the renovation of existing structures and construction of new structures. The Applicant will hire 28 new employees with an average base salary of $73,740 excluding benefits.

Penn A Kem (or its predecessor) has had two personal property PILOTs. As part of its overall growth, Penn A Kem has requested that it receive a real property benefit for improvements to an existing office building, the construction of a second office building and for the construction of a warehouse. To mitigate the environmental risk to EDGE, Penn A Kem will only be allowed to place the real property improvements for the two office buildings into the program under the conditions contained in this term sheet. The warehouse real property improvements will not receive any PILOT benefit.

Parcel 043047 00014 (3324 Chelsea Ave.) is 42.49 acres with existing manufacturing and support buildings of 185,403 square feet. Real property improvements at the site will include construction of 7,200 square-feet of office space and a new warehouse facility. The proportional value of the new office building on the site will be included in the PILOT. New personal property at the site will be included in the PILOT.

Penn A Kem is a chemical manufacturing company for agrichemical and pharmaceutical markets. Most of the company’s products are produced from the raw material known as furfural, one of the world’s premier renewable chemical building blocks, providing a green alternative to petrochemicals. Penn A Kem’s global parent company is Minafin SPRL, a Belgian holding company with 2018 consolidated net sales of $212M, operating 6 production facilities worldwide with over 860 employees.The Memphis plant serves as the corporate headquarters for Penn A Kem and employs 163 people.

The project is in a severely distressed New Market Tax Credit Eligible Census Tract with a poverty rate of 42.9% and an unemployment rate of 11.6%. The Applicant is active in the Douglas community through charitable activities with Douglas High and Elementary Schools, the Douglas Community Center and the community celebrations.

PILOT Term:

12

Projected New Jobs:

28

Projected Retained Jobs:

Not applicable

Total Jobs:

28

Projected Average Payroll of New Jobs:

$73,740

Projected Average Payroll of Retained Jobs:

Not applicable

Annual New Direct Payroll:

$2,064,720

Annual Retained Direct Payroll:

Not applicable

Total Capital Investment:

$38,545,000
Real Property Investment:
$2,000,000

Personal Property Investment:
$31,345,000

Community Reinvestment Credit (CRC):
$5,200,000

Capital Investment not in PILOT:
$28

Projected Tax Revenue:

$5,102,174

Projected Taxes Abated:

$2,867,307
City: $1,264,662
County: $1,602,645

Benefit/Cost Ratio:

1.78

Projected MWBE/LOSB Spending:

$695,535

Incentive Provided:

$2,867,307

Compliance Information

Not applicable

Approved

12/18/2019

Ramp up Period

2

Closing

Not applicable

Effective

Not applicable

Lease Begins

Not applicable

Lease Expires

Not applicable

Amended

Not applicable

Property Details

Lease Began

Not applicable

Lease Expires

Not applicable

Penn A Kem LLC

3324 Chelsea Avenue, Memphis, TN 38108