Salt Lake City approves development agreements for northwest quadrant

SALT LAKE CITY — Utah’s capital city is one step closer to developing its 3,000-acre northwest quadrant, a project spurred by the controversial relocation of the Utah State Prison.

The Salt Lake City Council and Redevelopment Agency on Tuesday approved development agreements with landowners in the area near Salt Lake City International Airport. The plan sets goals, objectives and strategies for the area’s development.

“Salt Lake City recognizes the complex nature of developing the northwest quadrant to maximize the economic potential while preserving the sensitive environment of the area,” Mayor Jackie Biskupski said in a prepared statement. “In creating this plan, we have collaborated over the past 19 months to come up with a strategic way to move forward, ensuring all key stakeholders were at the table.”

City officials initially adamantly opposed the relocation of the state prison west of the airport — but since then, they’ve tried to make the best of it, hoping to take advantage of the prison’s infrastructure to build out its largest remaining swath of undeveloped land.

The area, slated for light-industrial and commercial development, has so far landed one major business — an Amazon distribution center expected to bring in 1,500 new full-time jobs.

“We are delighted to have the opportunity to work with Salt Lake City on this truly remarkable project as we collectively look to differentiate the Salt Lake metro market as a world-class logistics center,” said John Birkinshaw, director of land planning for Rio Tinto Kennecott, in a prepared statement.

Lance Bullen, president and CEO of Colmena Group, a real estate development and investment company headquartered in Salt Lake City, said northwest quadrant landowners are "extremely excited for the potential of this area to take its position in the global logistics supply chain."

The agreement approved Tuesday will act as an economic tool to help the city toward its development goals, city officials said in a news release. The council also authorized the city to enter into an interlocal agreement with the Redevelopment Agency to collect property tax increment for infrastructure, site and business development, as well as other improvements in the northwest quadrant.

The agreement will invest $123 million in taxes back into the northwest quadrant over 20 years compared to $207,272 in total tax revenue if no project area was established, assuming all taxing entities participate and there’s an "aggressive" rate of development, according to a city staff report.

It’s also expected to increase taxable land values from $95 an acre to an average more than $460,000 and bring nearly 32,000 jobs to the area with a potential for 100,000 temporary construction jobs, according to estimates from the Kem C. Gardner Policy Institute.

“The northwest quadrant can easily become another key economic driver of development in the region,” said Councilman Derek Kitchen, who is also chairman of the city’s Redevelopment Agency. “Another benefit in developing the area is that 10 percent of revenues will be earmarked toward affordable housing options elsewhere in our city.”

City and state officials have committed to sharing the cost of the state prison’s infrastructure. The city has projected cost of the first two major roads and lines for water, sewer, gas, fiber-optic cables and lighting to be $90 million, of which $47 million will come from the state based on agreements to pay for the prison’s needed infrastructure. The city would foot the rest.

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