JOHNSTOWN - For the second consecutive month, the Fulton County Industrial Development Agency has approved early termination of a lease on a building it owns, this time for a deal netting the agency $18,000.
The IDA on Thursday approved early termination of the lease on a building at 178 Corporate Drive at the Crossroads Industrial Park in Gloversville. The IDA currently leases the building to the Crossroads Incubator Corp. The CIC subleases the building to Gen-Fame Inc., a pallet reprocessing company. The lease began in 1994 and it isn't due to end until June 2015.
But IDA Executive Director James Mraz told his board Thursday at the Fort Johnstown Annex the agency received an Oct. 30 letter from the CIC advising that corporation was exercising its right of early lease termination.
Fulton County Industrial Development Agency Executive Director James Mraz on Thursday shows board members the site of a building the IDA plans to terminate a lease for at the Crossroads industrial Park.
The Leader-Herald/Michael Anich
He said the IDA and CIC must complete the process to terminate the lease within 90 days of that date or by Jan. 30.
"They have the right to pursue the early termination," Mraz said. "The property would no longer be tax exempt."
Mraz and Center for Regional Growth President and Chief Executive Officer Michael Reese, whose agency oversees the CIC, both said Thursday that Gen-Fame Inc. owner Al Gentile wants to purchase the building he's been operating in.
"We entered into a purchasing agreement," Reese said. "They are purchasing the building. He thought it would be more advantageous to purchase it."
Mraz said the payment in lieu of taxes, or PILOT agreement the company had previously used will be terminated, although he said it basically has expired anyway. The property at 178 Corporate Drive will immediately return to the tax rolls.
The existing lease requires the CIC to make a payment of $1,000 per year for each year of the lease's existence. Mraz said the lease was in existence 18 years so the CIC will pay the IDA $18,000 at closing.
The IDA approved a deed conveyance from itself to the CIC. The IDA also authorized a payment of $1,500 to the Glens Falls law firm of Fitzgerald, Morris, Baker & Firth for legal services required in the transaction.
IDA board member Arlene M. Sitterly said some people in the community think companies immediately leave after their PILOT expires, but that isn't the case with Gen-Fame Inc.
"That's another good example of what's going on with an old building," Sitterly said. "It's wonderful."
The IDA in October also approved a request for early termination of a lease involving the Crossroads Business Park property of Epimed International Inc. in Gloversville. That deal also made that property no longer tax-exempt and netted the IDA a payment of $12,166. The IDA made a similar deal in August 2011 when it approved early termination of six industrial property leases it had with Stag Albany 2, LLC. That deal netted $88,175 for the IDA and freed the agency from any future obligations with the properties.
Michael Anich covers Johnstown and Fulton County news. He can be reached at email@example.com