$99 million warehouse project wins IDA tax breaks
An artist’s rendering of a proposed warehouse complex on New South Road in Hicksville. Credit: M+H Architects
A $99.4 million plan to build a warehouse on formerly toxic land in Hicksville has won millions of dollars in tax breaks from Nassau County.
The board of the county’s Industrial Development Agency voted unanimously last week to grant developer Brookfield Properties 20 years of property-tax savings, up to $847,500 off the mortgage recording tax and a sales-tax exemption of up to $1.7 million on the purchase of construction materials and equipment.
Brookfield, one of the world’s largest commercial real estate companies, wants to construct a 207,200-square-foot warehouse at 125 New South Rd.
The 15-acre vacant parcel was heavily polluted starting in 1946 by Hooker Chemical & Plastics Corp., Ruco Polymer Corp. and other manufacturers of plastics, rubber and polyester. It was declared a Superfund site in 1984 and has since been cleaned up, said Daniel P. Deegan, Brookfield’s real estate attorney.
“It has been remediated by the federal and state governments … They’ve removed 35,000 tons of soil from the site,” he told the IDA board.
Deegan said Manhattan-based Brookfield hasn’t yet identified tenants for the warehouse but at least 50 jobs would be created.
Construction would be completed by June 2024, and the building would be fully leased a year later. Aurora Contractors Inc. in Ronkonkoma has been hired to serve as the general contractor, he said.
“The property was a generator of jobs for decades, but it’s laid fallow and polluted for many years,” Deegan said. “This is an opportunity to put the property back to productive use.”
However, without the tax-aid package, the warehouse would likely be constructed in northern New Jersey, “where there are lower taxes,” Brookfield said in its IDA application.
Responding to a question from IDA member John Coumatos, Deegan said the developer has no plans to sell the warehouse after it has opened. “Their standard operating procedure is to develop a property and then to own it and manage it going forward,” he said.
The project is about 100,000 square feet smaller than first proposed in March 2022 because of a zoning change by Oyster Bay Town, which required additional parking spaces, Deegan said in an interview.
IDA Chairman William H. Rockensies predicted the IDA would be considering similar projects in the future as retail sales continue to shift from brick-and-mortar stores to online retailers that need distribution centers for the delivery of purchases to customers’ doorsteps.
“We’re going to see more warehouse developments because that’s what the market is demanding,” he said in an interview. “And in this case, with the IDA’s help, a parcel that was polluted is being put to a productive use and a minimum of 50 jobs will be created.”
Correction: An earlier version of this story incorrectly characterized the design of the project; a single warehouse is proposed.
James T. Madore writes about Long Island business news including the economy, development, and the relationship between government and business. He previously served as Albany bureau chief.
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