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The Pallet Factory Inc.
Project Number: 20191110
Pilot Type: Jobs
Status: Approved
Parcel ID: 073092 00066C
County Commission District: 11 | City Council District: 03, 08
Pilot Type: Jobs
Status: Approved
Parcel ID: 073092 00066C
County Commission District: 11 | City Council District: 03, 08
Summary
Amended and Restated – November 18, 2020The Pallet Factory Inc. (“Applicant”) is seeking a seven-year Jobs PILOT to enable the company to create 23 Net New Jobs with an average base salary of $55,767 excluding benefits and invest $3,500,000 in new construction and $1,800,000 in manufacturing equipment at 3740 Arnold Road in the City of Memphis.
Parcel 073092 00066C is 9.53 acres and contains an existing 46,508 square foot manufacturing facility. The Applicant will construct a new 40,000 square foot facility on the parcel. All of the real estate will be placed in the PILOT, but the applicant’s benefit and PILOT payments on the real property portion will be calculated based on the amount of new space created.
The Pallet Factory makes pine and hardwood pallets and refurbishes existing pallets to customer specifications. The company was launched in 1979 and has operated in this location since 1998. The Memphis-based company serves customers in a 200-mile radius. The Pallet Factory has added a Nashville facility and grown to 120 total employees and $30 million in revenue.
The current Memphis facility is not sufficient to support continued growth. The company is evaluating options that will improve efficiency, reduce material handling time and movements, and modernize production. Additionally, the Pallet Factory needs to divide the facility dedicated to new construction and the refurbishment operation.
Staff projects $952,320 in local total tax revenues to be received during the PILOT term of this project and a $637,926 benefit to the Applicant.
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The Pallet Factory Inc. (“Applicant”) was approved for a seven-year Jobs PILOT to enable the company to create 15 Net New Jobs with an average base salary of $55,767 excluding benefits and invest $3,500,000 in new construction and $800,000 in manufacturing equipment at 3740 Arnold Road in the City of Memphis.
Parcel 073092 00066C is 9.53 acres and contains an existing 46,508 square foot manufacturing facility. The Applicant will construct a new 40,000 square foot facility on the parcel. All of the real estate will be placed in the PILOT, but the applicant’s benefit and PILOT payments on the real property portion will be calculated based on the amount of new space created.
The Pallet Factory makes pine and hardwood pallets and refurbishes existing pallets to customer specifications. The company was launched in 1979 and has operated in this location since 1998. The Memphis-based company serves customers in a 200-mile radius. The Pallet Factory has added a Nashville facility and grown to 120 total employees and $30 million in revenue.
The current Memphis facility is not sufficient to support continued growth. The company is evaluating options that will improve efficiency, reduce material handling time and movements, and modernize production. Additionally, the Pallet Factory needs to divide the facility dedicated to new construction and the refurbishment operation.
PILOT Term:
7
Projected New Jobs:
23
Projected Retained Jobs:
Not applicable
Total Jobs:
23
Projected Average Payroll of New Jobs:
$55,767
Projected Average Payroll of Retained Jobs:
Not applicable
Annual New Direct Payroll:
$1,603,301
Annual Retained Direct Payroll:
Not applicable
Total Capital Investment:
$5,300,000
Real Property Investment:
$3,500,000
Personal Property Investment:
$1,800,000
Community Reinvestment Credit (CRC):
Not applicable
Capital Investment not in PILOT:
Not applicable
Projected Tax Revenue:
$952,320
Projected Taxes Abated:
$637,926
City:
$281,367
County:
$356,559
Benefit/Cost Ratio:
1.49
Projected MWBE/LOSB Spending:
$970,689
Incentive Provided:
$637,926
Compliance Information
Not applicable
Approved
11/13/2019
Ramp up Period
2
Closing
12/31/2020 (Real)
Effective
12/31/2020
Lease Begins
12/31/2020 (Real)
Lease Expires
12/31/2027 (Real)
Amended
11/18/2020
Property Details
Lease Began
12/31/2020 (Real)
Lease Expires
12/31/2027 (Real)