Gavilon's plan for a new world headquarters is moving forward, with a tax-increment financing request to the City of Omaha and a groundbreaking ceremony slated this fall at 14th and Dodge Streets.
The grain and commodity trading firm, which has outgrown leased quarters at the downtown ConAgra campus, hopes to have its five-story, 131,225-square-foot office building ready by December 2013.
Featuring a state-of-the-art trading floor and glass exterior, the project's estimated price tag is $44 million.
The move to the 1.45-acre World-Herald Square Plaza means Omaha will keep a fast-growing corporation that employs about 2,000 people worldwide, 350 of them locally.
And it means a downtown block again will bustle with as many as 560 professionals, which is the new structure's capacity.
City leaders are praising the investment.
“It's a big deal for downtown Omaha to have another corporate headquarters, and to have a vacant property filled,” said David Brown, president of the Greater Omaha Chamber of Commerce. “Once construction starts, I wouldn't be surprised to see other lots around it develop, too.”
Calling Gavilon one of the city's key projects this year, Brown said officials launched an enticement campaign as soon as they heard rumblings the company was seeking to expand from its 48,000-square-foot space. Among the public assistance Gavilon hopes for is $3.94 million in tax-increment funds generated by the increase in property taxes resulting from the improvements.
Mayor Jim Suttle, who earlier remarked that he preferred a skyscraper at the former newspaper property, said Tuesday he sees no obstacle to city approval of the TIF request.
“We normally think of commodities, futures, being in places like Chicago, Hong Kong, San Francisco, London,” Suttle said. “This is the kind of international connectivity that Omaha needs, and it will benefit us tremendously with spinoffs.”
The mayor pointed to the failed WallStreet Tower project site, now a dirt field just west of the planned Gavilon offices. He also cited the nearby former Pinnacle Foods site and the aged City Auditorium.
“There will be other interested parties stepping up the pace,” he said.
Referring to his previous reservation about size, Suttle said: “This is a bird in the hand we're not going to ignore. We're going to work with it and make it happen. It's the right thing for investment in downtown Omaha.”
Gavilon's move will put it across the street from two other corporate headquarters, the Union Pacific Railroad's 19-floor facility and The World-Herald's 16-floor building.
Terry Kroeger, CEO of The World-Herald Co., called the new Gavilon home and trading floor a great use for property that served as the newspaper's headquarters from 1948 to 2006, when the paper moved one block to the south.
Referring to former World-Herald publisher Henry Doorly, who was credited with establishing the newspaper's role in civic involvement, Kroeger said: “I imagine he would find this very progressive.”
Plans call for the facility's “front door” to face Capitol Avenue, but officials said the design intent is to be visually and architecturally appealing on all four sides. Three floors will be office space and trading floor, and two above-ground levels will contain 205 parking stalls. Part of the ground-floor parking level is to be used for other Gavilon uses, such as a cafeteria and health facility.
Public improvements on the block bounded by 13th, 14th, Dodge Street and Capitol Avenue are to include on-street parallel parking, new sidewalks, ornamental paving, planters and pedestrian lighting.
The Denver-based Open Studio Architecture and Perkins + Will of Chicago are designing the structure. Olsson Associates of Omaha is the civil engineering firm.
Under an arrangement with 13 Capitol LLC, a wholly owned affiliate of Minnesota-based Opus Development Corp., Gavilon will rent the facility long-term and Opus will be owner and landlord.
The closing of the sale is expected as early as next week. Terms were not disclosed, but the property was listed recently by Colliers International at $2.4 million.
Opus senior vice president and general manager Marshall Burton said his company is proud to contribute to downtown Omaha, and he said the build-to-suit development method allows Gavilon and Opus to stick to their respective expertise. “It allows our clients to stay focused on their core business while we stay focused on the real estate and delivery of real estate.”
Both Gavilon and Opus declined to define the length of the lease. But Brown said the ownership arrangement gave him no qualms and he was convinced Gavilon is committed for the long run.
T.J. Twit, vice president with the Lund Co., called the build-to-suit arrangement relatively common for a company of Gavilon's size. He, too, anticipates a ripple effect of commercial real estate development.
“The fact they chose Omaha, regardless that they were already here, should be reaffirming to companies already doing business in Omaha, and should be a signal to those considering Omaha that this is a pretty good place to be, to live and do business.”
Gavilon's new headquarters comes in an era of robust growth.
Since Gavilon became a private company in 2008, it has completed 13 acquisitions and 14 Greenfield projects, doubling its employee base to 2,000. Among the acquisitions was Kansas City-based DeBruce Cos. in 2010, which expanded the company's agricultural operations and positioned Gavilon as the third-largest grain handler in the U.S. by licensed storage capacity.
This past May, Marubeni Corp. of Japan announced a $3.6 billion plan to buy Gavilon. The combination of Marubeni's global trading network and Gavilon's strengths in North and South America was expected to help the combined companies move into areas of growth more swiftly and with lower risk because of the company's scale.
Gavilon retained its name — adapted from the Spanish word gavilan, or hawk — and recently introduced a new logo and branding. Now a shield and the words “Thrive On” accompany the Gavilon name.
Greg Heckman, Gavilon's president and chief executive officer, said he was excited about the latest chapter.
“It's fitting that a growing company like ours is building in downtown Omaha, where other major companies have invested and thrived.”
He said the company works daily with others around the world, yet is glad to call Omaha home.
“We're excited to move forward with building our new world headquarters in our home city.”
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