Explanation
BACKGROUND: The need exists to amend Ordinance No. 1431-2024, passed by Columbus City Council (“Council) on June 3, 2024, which authorized the Director of the Department of Development to amend the Community Reinvestment Area Agreement (the “AGREEMENT” or “CRA Agreement”) between the City of Columbus (CITY) and Big Lots Management, LLC (the “Enterprise”). An amendment is now required to revise the associated contributors to the job creation and payroll commitments as set forth in the CRA Agreement.
Columbus City Council (COUNCIL), by Ordinance 1775-2016, passed July 18, 2016 authorized the City of Columbus (CITY) to enter into a Community Reinvestment Area Agreement (the “AGREEMENT”) with The Hamilton Crossing LC LLC & Big Lots, Inc. to grant a tax abatement of one-hundred percent (100%) for a period of ten (10) years in consideration of a proposed investment of approximately $30,000,000.00 to $45,000,000.00 investment in new building construction, the retention and relocation of approximately seven hundred fifty (750) existing full-time permanent positions with an associated payroll of $65,000,000.00, and the creation of five (5) new full-time positions with an associated annual payroll of approximately $362,500 related to the construction of a new approximately 300,000 square-foot facility and one or more associated parking structures to be used as the corporate headquarters facility for BIG LOTS (the “PROJECT”) at the southwest quadrant of State Route 161 and Hamilton Road on parcel number 010- 221377, Columbus, Ohio 43081 and within the Hamilton-161 Community Reinvestment Area (the “PROJECT SITE”).
The First Amendment for Assignment and Assumption to the AGREEMENT (the “FIRST AMENDMENT”) was made and entered into effective on November 3, 2016. Pursuant Section 22 (Transfer and/or Assignment) of the AGREEMENT (“SECTION 22”) it states that “The ENTERPRISE shall have the express authority to assign this AGREEMENT in whole or in part to (i) any entity within BIG LOTS GROUP or (ii) the Columbus-Franklin County Finance Authority…” and “in the same manner, each assignee also shall have the express authority to wholly or partially assign this AGREEMENT to any of the foregoing.” Whereas, with respect to the Finance Authority Structures the ENTERPRISE added Columbus-Franklin County Finance Authority in party to the AGREEMENT and assigned all the benefits of the CRA Agreement.
Pursuant the Second Amendment for Assignment and Assumption to the AGREEMENT (the “SECOND AMENDMENT”) was made and entered into effective on October 31, 2019 the Finance Authority assigned BLHQ, LLC all of the benefits of the AGREEMENT which the Finance Authority received in the FIRST AMENDMENT, including, but not limited to, the benefits of the AGREEMENT with respect to the Finance Authority Structures as set forth in Section 1 of the FIRST AMENDMENT.
Prior to the execution of the AGREEMENT, the Department of Development received a notification that one of the lessee’s (WPG Management Associates, Inc.) has their employees of record under the entity WPG Real Estate Associates, Inc. The Company has leased 59,390 square feet of office space at the PROJECT SITE to WPG Real Estate Associates, Inc. as well as any other additional new tenant that will occupy the space at the PROJECT SITE to contribute to the job and payroll retention commitments as set forth in the AGREEMENT. Additionally, BLHQ, LLC would like to assign Big Lots Management, LLC all of the benefits of the AGREEMENT.
Columbus City Council (Council) by Ordinance 2849-2015, designated the Hamilton-161 Community Reinvestment Area as a “Community Reinvestment Area” pursuant to Chapter 3735 of the Ohio Revised Code. Effective December 17, 2015, the Director of the Ohio Development Services Agency determined that the aforementioned area designated in the aforementioned Council Ordinance contained the characteristics set forth in the Ohio Revised Code Section 3735.66 and confirmed that area as a “Community Reinvestment Area” pursuant to said Chapter 3735.
This legislation is to amend Ordinance No. 1431-2024, passed by Columbus City Council (“Council) on June 3, 2024, to assign all benefits of the AGREEMENT to Big Lots Management, LLC from BLHQ, LLC and to WPG Real Estate Associates, Inc. as well as any other additional new tenant that will occupy the space at the PROJECT SITE to contribute to the job and payroll retention commitments as set forth in the AGREEMENT and to authorize the Director of the Department of Development to enter into a Third Assignment of the AGREEMENT (“THIRD ASSIGNMENT”).
This legislation is being presented as 30-day legislation.
FISCAL IMPACT:
No funding is required for this legislation.
Title
To amend the Ordinance No. 1431-2024, passed by Columbus City Council (“Council) on June 3, 2024, to assign all benefits of the agreement to Big Lots Management, LLC from BLHQ, LLC and to WPG Real Estate Associates, Inc. as well as any other additional new tenant that will occupy the space at the project site to contribute to the job and payroll retention commitments as set forth in the agreement; and to authorize the Director of the Department of Development to enter into a Third Assignment of the agreement. ($0.00)
Body
WHEREAS, the need exists to amend Ordinance No. 1431-2024, which was approved by Columbus City Council on June 3, 2024; and
WHEREAS, Ordinance No. 1431-2024 authorized the Director of Development to amend the AGREEMENT for the third time for Assignment and Assumption in consideration of the notification from Big Lots, Inc. (“BIG LOTS”) and Big Lots Management, LLC on behalf of BLHQ, LLC dated November 20, 2023, received by the CITY and through ensuring correspondence, confirmed that due to economic conditions resulting from the COVID-19 pandemic, the Company has leased 59,390 square feet of office space at the PROJECT SITE to WPG Management Associates, Inc. to contribute to the job and payroll retention commitments as set forth in the AGREEMENT.
WHEREAS, prior to the execution of the AGREEMENT, the Department of Development received a notification that one of the lessee’s (WPG Management Associates, Inc.) has their employees of record under the entity WPG Real Estate Associates, Inc. The Company has leased 59,390 square feet of office space at the PROJECT SITE to WPG Real Estate Associates, Inc. as well as any other additional new tenant that will occupy the space at the PROJECT SITE to contribute to the job and payroll retention commitments as set forth in the AGREEMENT. Additionally, BLHQ, LLC would like to assign Big Lots Management, LLC all of the benefits of the AGREEMENT.
WHEREAS, due diligence has been undertaken by the CITY in that Big Lots Management, LLC has agreed to fully assume fully assume the terms and commitments of the ENTERPRISE pursuant to the AGREEMENT, has submitted an updated Economic Development Incentive Application, the five-hundred dollars ($500.00) Amendment Fee and that this application and all other pertinent information has been reviewed and vetted; and
WHEREAS, the need exists to amend Ordinance No. 1431-2024, which was approved by Columbus City Council on June 3, 2024, to assign all benefits of the AGREEMENT to Big Lots Management, LLC from BLHQ, LLC and to WPG Real Estate Associates, Inc. as well as any other additional new tenant that will occupy the space at the PROJECT SITE to contribute to the job and payroll retention commitments as set forth in the AGREEMENT; and NOW THEREFORE,
BE IT ORDAINED BY THE COUNCIL OF THE CITY OF COLUMBUS:
SECTION 1. That Section 1 of Ordinance No. 1431-2024 is hereby amended as follows:
That the Director of the Department of Development is hereby authorized to amend the City of Columbus Community Reinvestment Area Agreement for the third time with BLHQ, LLC for Assignment and Assumption to remove BLHQ, LLC and assign Big Lots Management, LLC all of the benefits of the CRA Agreement and to add WPG Management Real Estate Associates, Inc. as lessor and tenant, as well as any other additional new tenant that will occupy the space at the PROJECT SITE to contribute to the job and payroll retention commitments as set forth in the CRA Agreement (“THIRD ASSIGNMENT”).
SECTION 2. That existing Section 1 of Ordinance No. 1431-2024 is hereby repealed.
SECTION 3. That the THIRD ASSIGNMENT be signed by Big Lots Management, LLC and WPG Real Estate Associates, Inc. within ninety (90) days of passage of this ordinance, or this ordinance and the incentive authorized herein shall be null and void.
SECTION 4. That this Ordinance shall take effect and be in force from and after the earliest period allowed by law.