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As a subscriber you can listen to articles at work, in the car, or while you work out. Subscribe NowElanco Animal Health Inc. announced Friday morning it will build a $100 million headquarters campus at the former General Motors stamping plant west of downtown, a move the state has incentivized with more than $86 million in tax breaks plus land for the project.
The move will secure Elanco’s future in central Indiana and provide a long-sought reuse for at least part of the stamping plant site, which has been vacant for almost a decade. But the deal is a blow to the city of Greenfield, where Elanco now has its headquarters. The state and company have agreed to work together to find a user for the company’s Greenfield space.
Elanco, which spun off from Eli Lilly and Co. in 2018 after more than a half-century, said it selected the site after a “rigorous, multi-state search.” The maker of animal vaccines and food additives had been noncommittal in recent months over whether it would keep its headquarters in Indiana.
The state will provide 45 acres of the 91-acre site to Elanco for the headquarters and up to $73 million in conditional tax credits over a 10-year period. The Indiana Economic Development Corp. is also providing up to $4 million in training grants based on the company’s commitment to retain 1,623 Hoosier jobs and create up to 573 high-wage jobs.
The IEDC offered up to $7 million in assignable redevelopment tax credits, up to $2 million in conditional Hoosier Business Investment tax credits, and up to $500,000 for relocation expenses based on the company’s plans to invest in the campus.
Elanco called IEDC’s offer a “competitive incentive package” and said it has a restricted option for an additional 20 acres. The state and city will support redevelopments in the area and work to increase neighborhood connectivity, Elanco said.
Overall, Elanco said it plans to invest more than $300 million in its Indiana operations, which the state said will ensure “the Hoosier state is at the center of its future growth and future consolidation.” Elanco will retain its manufacturing centers in Clinton, Indianapolis and Terre Haute and plans to center its research and development activity in the state.
Elanco’s announcement comes one day after Ambrose Property Group said in a public notice that it had sold the GM stamping plant site to an unidentified buyer.
That turned out to be the state. The IEDC paid $25.5 million for 91 acres. Ambrose had been asking about $50 million for the site, which it had originally purchased for $3 million from RACER Trust, an organization set up to handle abandoned GM properties.
According to a notice of voluntary dismissal filed by Ambrose in Marion Superior Court, the sale resolved the year-long legal dispute between the city of Indianapolis and the locally based developer that started after the company withdrew in September 2019 from its $1.4 billion Waterside development on the 103-acre property.
The Hogsett administration had threatened to take the property from Ambrose using eminent domain.
Ambrose’s decision to pull back from its Waterside project had left the site’s future in limbo. But Elanco said Friday it will begin planning for the downtown site immediately. It expects the project to take two to three years to complete.
The city of Indianapolis has agreed to help increase accessibility to the site by building a two-way bridge across the river at the current location of Henry Street. In addition, the city and state will partner on the development of a new pedestrian bridge connecting both banks of the White River.
The city plans to use $64 million from a tax increment financing fund to pay for the improvements.
The remaining property along the south and southwest sides of the former GM stamping plant site will be available for future mixed-use development that “prioritizes connectivity, livability and a seamless integration with the adjacent neighborhoods,” the state said.
That is to include 10 acres of outdoor space along the site’s eastern-most border that will facilitate an expansion of White River State Park and improvements to the river and its western banks, the state said.
“For decades, the GM stamping plant served as an anchor for near westside Indianapolis families,” Indianapolis Mayor Joe Hogsett said in written remarks. “When the facility closed, residents mourned the loss—not just because of the economic impact, but out of concern for the long-term vibrancy of the community. Today’s announcement will mark a new chapter for the neighborhood, spurring greater connectivity beyond the Mile Square and catalyzing transformative development opportunities along the White River and beyond.”
Although the move solves a dilemma in Indianapolis, it represents a big loss for Greenfield, home to Elanco for decades. Elanco has been based at Progress Park since 2010, spread out in five buildings over 20 acres in a location highly visible from Interstate 70. Before that, it was about five miles away, near U.S. 40 and Meridian Road.
Elanco did not say how many other sites it reviewed, or whether it seriously considered moving out of state.
In its announcement, Elanco praised the new downtown location, saying it offers the opportunity to build a “smaller, more efficient campus” that should translate to meaningful cost savings and feature lower costs per employee compared with its current operations. The new location will have about 25% less office space than the Greenfield headquarters.
“With a shared vision for the future of the agbioscience industry and the modern, post-COVID era workplace in Indiana, we are pleased Elanco can serve as a catalyst through our global headquarters and base of future consolidated operations and capabilities in Indiana,” Elanco President and CEO Jeff Simmons said in a statement. “In partnership with Gov. Holcomb, Mayor Hogsett and the IEDC, we look forward to continuing our nearly 70-year history in Indiana, building a leading animal health company and serving the Indianapolis community.”
Holcomb called the decision “a momentous day” for Indiana that will position Elanco for further growth and consolidation.
“Elanco is an important asset to Indiana, a leader in our growing agbioscience sector, which is poised to grow and continue innovating,” Holcomb said in written remarks. “We are thrilled with the direction of Elanco’s future and the transformational impact its growth will have on the agbioscience sector, the downtown Indianapolis footprint, and most importantly, the lives of Hoosier workers.”
Hogsett said Elanco’s announcement marks a new chapter for the neighborhood around the old stamping plant, and could spur greater connectivity in the area.
Elanco in August completed the largest acquisition ever in the animal health industry, the $7 billion purchase of the animal-health unit of German pharmaceutical giant Bayer AG.
The purchase elevated Elanco from the world’s fourth-largest animal-health player to the second-largest, behind only New Jersey-based Zoetis.
It boosted Elanco’s workforce from 5,800 to 10,000. Simmons said this fall that he plans to get $300 million in savings by cutting duplicative functions.
Elanco, founded in 1954, was wholly owned by Indianapolis-based Eli Lilly and Co. until September 2018, when the pharmaceutical giant spun it off in an initial public offering.
The now-demolished 2.1 million-square-foot plant metal-stamping plant opened on the site in 1930 and employed more than 5,000 at its peak. That number was fewer than 700 when it closed in 2011.
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$73 million in conditional tax credits AND the land? Take that Ambrose.
I guess we now know who they sold it too.
It states it clearly in the article that it was sold to the State, namely The Indiana Economic Development Corp., for a $22.5 million profit.
Ambrose did very well on the deal. Initially they sold a plot to the Zoo for more then they paid for the whole site. Combine that with the 22.5 mil they just made and I am sure they will “take it”. It’s a win for everyone. Well, except the tax payer who just handed a multi billion dollar company free land and tax credits out the whazoo.
Actual link for the full size image: https://cdn.ibj.com/wp-content/uploads/2020/12/Screen-Shot-2020-12-04-at-7.46.32-AM-1024×677.jpg
Ugh. Nothing like a suburban office park in the middle of downtown Indy. This promises to be another dead zone filled with more cars than people. Come on, Indy; Get it together.
You are upset that they were able to get the second largest animal health bioscience company to building their world headquarters on a site that has been vacate for decades? This is great news for Indianapolis and getting more working professionals downtown.
Skyscrapers are a thing of the past.
The site “has been vacate for decades”, huh?
This is great news. Economic development working.
Horrific plan
This is an absolute grand slam for downtown Indy.
2mm development per acre is hardly a grand slam for downtown Indy lol Larry
For those who are being critical, over half of the site is left to be developed. Any plan for this site would include office space, so we should be thankful that there is already a tenant lined up for that aspect (unlike Ambrose’s plan). Focus on advocating for good use of the remaining land.
Over half the site is NOT left to be developed
10 acres is for White River State Park expansion leaving only 16-36 acres available to be developed (depending on whether Elanco executes their 20 acre option or not)
This is terrific news! After years of various ideas, many of which were horrible for the area (criminal justice facility), this is a wonderful addition to downtown Indy. Elanco is a very solid, innovative company. And the fact that it’s all about animal health warms my heart. Finally, the right business for the property and for Indy!
This is a great project. The chances of a local developer spending billions for shops, hotel’s, restaurants and homes was very small in this environment. Now you have a billion dollar company bringing employees downtown to participate in all downtown has to offer. The younger employees might move downtown and help to revitalize the existing housing stock next to the hq property just like people are doing in Fountain Sq on the other side of downtown.
Lame
Let me get this straight, tax payers dole out $25 million to Ambrose, give up $73 million in tax revenue, so that we can “retain 1623” jobs, by relocating them the jobs from Greenfield to Downtown Indy. We are supposed to believe that Elanco will create an additional 573 jobs while at the same time reduce the office footprint by 25%.
This just sounds to me like more corporate welfare while screwing the taxpayers of this state and especially the town of Greenfield.
Smart move, a world class corporation will stay and expand in Indiana who desperately needs corporate headquarters. The powers to be understand this.
That is 1000+ lunches being bought most days downtown, and hundreds of happy hours being attended downtown, etc.
Look beyond tax dollars and consider the real local impact.
James, a boon to the service industry is hardly a reason to execute this type of deal.
Hate to see Ambrose succeed in fleecing everyone – massive profit after not delivering anything at all.
+1
I totally agree with you. Ambrose made a fortune with little investment in the property.
Ambrose was smart to get out of the project. These kinds of large-scale developments take way too long to gel and are loaded with risk.
Why does the corporate office park have to be so spaced out? Only gripe is density. Can they consolidate and relinquish more space for future development?
That land should have been apartments on the water and the water area upgraded. Could have sold Condos and received income taxes and property taxes instead of giving up taxes. However, we have come to giving up taxes for jobs. Hope the math works out in the states favor eventually.
This will sell condos and increase the property tax but also other taxes, short sighted to think you build condos without the jobs to fill them.
Pluses and minuses in many categories. Utilization of land and jobs is the major plus. Indianapolis needs more investment in job creation beyond service activities associated with conventions. Residences with lovely views are not attainable without income to secure them. Competition is tough and Indianapolis is not a particularly attractive location for businesses compared to peers such as Columbus OH or Nashville TN that are not hamstrung by a regressive state legislature that promulgates and passes anti-urban legislation (a state statute against light rail and a vindictive riders forcing the transit agency to solicit money in competition with benevolent causes!). Indiana which in general is characterized by poor schools, lower education, poor health, lower income, and bad policies is not ‘open arms’ for business or entrepreneurs as most in the Statehouse think. Indiana’s best bet for prosperity and growth rests in Indianapolis and central Indiana; still, tax incentives and other so-called giveaways may be necessary.
The expansion of the park seems to be a little strange. It is really disconnected from the rest of the park by railroad tracks, and major streets. The pedestrian bridge seems strange too. On the east side of the river, it leads to a former coal yard of the Citizens steam plant, which is cut off from Victory field by a major set of rail road tracks.
Re-routing White River Parkway to the west is going to move it off the top of levy and give everyone a view of a big bank of dirt. That whole area is called the “Little Valley” and before the levy sat in a major flood plain.
The entire length of White Rive and Fall Creek should be addressed from the perspective of a parkway/state park with continuous bike and hike trails, open spaces, trees (!) and water flow control to ensure each stream provides minimum waters levels along with flood control. Fall Creek is a particular eyesore, particularly from Capitol Avenue to 38th Street. Seeking water levels that provide luxurious algae-infested waterfront properties along Geist have left lower stretches of Fall Creek as nothing better than a ditch. Aesthetic aspects, despite poor maintenance and condition, of historic and attractive bridges on Capitol, Meridian and Delaware over Fall Creek cannot be noted due to the forest in the silted waterway. The IWC canal between Fall Creek and 38th Street should become a major focus. A boulevard and parallel greenway with bike and pedestrian trails should be built from Burdsal Parkway to beyond 30th Street and connect to White River Parkway E. Drive. The adjacent neighborhood needs drastic attention; new market rate housing should be built adjacent to the boulevard as a first phase of a Riverside are revitalization scheme that would focus on housing replacement and renovation akin to what has occurred in Bates-Hendricks and near-southside neighborhoods.