Tuesday, May 30, 2023

Blue Clay Business Park infrastructure approved for $7.1M, double original estimate

A contract for infrastructure at Blue Clay Business Park was approved Monday, though double its original estimated cost. (Port City Daily/Courtesy WBD)

NEW HANOVER COUNTY — A new business park in the northern portion of the county is slowly gaining buyers and tenants, all relying on solid infrastructure for build-outs.

As buyers’ purchases are contingent on water and sewer lines and roads being constructed, the county revealed Monday the price from its original estimate has doubled — going from $3.6 million to $7.5 million.

READ MORE: $500K, 35 jobs: NHC approves 2 sales in Blue Clay Business Park

ALSO: NHC commissioners to vote on first land sale in Blue Clay Business Park

New Hanover County Commissioners unanimously approved a $7.1 million construction contract to Wells Brothers to install roadways, sanitary sewer, storm water system and a water distribution system to Blue Clay Business Park. The additional $400,000 accounts for testing needed after installation, as well as the design.

In 2017, the county began preliminary engineering on the property, located at 4101 Blue Clay Road. A final report, including input from the U.S. Army Corps of Engineers on wetland determination, was submitted June 2020.

“We all know what happened in early 2020,” county facilities project manager Kevin Caison said at the meeting, “which didn’t actually impact the construction market until a year-and-a half later. We saw huge changes in the market for supply chain and labor.”

Caison, who said he’s been in the construction industry his entire life, said the last three years of changes, ignited by the pandemic, is the worst he’s seen.

Commissioner Dane Scalise said he was “strongly in favor” of the project due to it leading to the creation of new jobs, but wanted Caison to unpack for the public how the number rose so significantly.

“Our original budget construction cost [in 2020] was $2.4 million and then when we add in testing services, we would need to do and design, we felt comfortable with $3.6 million for the overall project budget,” Caison said. “We had no idea; I don’t think anyone did, what would happen since that time.”

It’s not the only county project that has come in twice the original estimated cost. Caison said the emergency management storage buildings at four schools were also double the original plan.

A request for proposals for the infrastructure development was sent out earlier this year, with bids reviewed by March 31. All submissions exceeded the county’s budget, and Caison explained there was some confusion by companies.

It was rebid, with updated proposals reviewed by April 14. Wells Brothers Construction was the low bidder.

Once the work is complete at Blue Clay, Cape Fear Public Utility Authority will maintain the water and sewer and North Carolina Department of Transportation will own the roads.

Any additional infrastructure upgrades needed by future tenants would be the responsibility of the buyer.

In February, commissioners voted on the first property sale at the business park. Francini Inc spent $250,000 for 6.25 acres, with a four-year option to purchase 7 more acres.

Last month, commissioners approved two more sales: a $233,750 buy of 5.5 acres to Coastal Millwork Supply Co. and a $213,350 sale for 5 acres to FTT Cabinetry.

As those sales were already approved by commissioners, the rates cannot be increased to offset infrastructure cost.

However, commissioner Jonathan Barfield questioned the future per-acreage price being offered at the park, and what three companies have purchased it for over the last few months.

“What is our recapture time frame based on initial investments?” he asked county manager Chris Coudriet.

“The actual number of years of return are based on the taxable value,” Coudriet said in response.

Coudriet noted the $42,500 per-acre price tag was set two years ago but said moving forward, the county would work with Wilmington Business Development and interested buyers to “scale up” the price by a significant amount.

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