JOHNSTOWN - The Fulton County Industrial Development Agency on Friday approved a request for early termination of a lease involving the Crossroads Business Park property of Epimed International Inc.
The deal makes the property no longer tax-exempt and nets the IDA a payment of $12,166.
IDA Executive Director James Mraz said Tuesday his agency's action involved Epimed's property at 141 Sal Landrio Drive at the Gloversville-based park. Boston-based Stag Industrial Holdings, LLC purchased the property from the Crossroads Incubator Corp. several years ago.
"The owners are simply terminating the lease, nothing changes," Mraz said. "Epimed is still the tenant."
Agency attorney Kara Lais has told the IDA in the past that Stag isn't obligated to give the IDA a reason for early termination of a lease.
Epimed Vice President of Manufacturing Bruce Whitcavitch didn't return phone calls seeking comment.
Epimed, a medical devices manufacturer, has been the anchor business with a research and development center at the park since it opened in the late 1990s. U.S. Sen. Charles Schumer toured the 26,000-square-foot plant in August 2011.
Mraz said the IDA currently leases the Epimed building to Stag Albany 2, LLC - one of many subsidiaries of Stag Industrial Holdings, LLC. He said Stag subleases the building to Epimed.
But Mraz said that the IDA on Sept. 13 received a letter from Stag formally advising it was exercising its right of early termination of the Epimed lease. Stag requested the IDA approve its request by Oct. 9, which was Tuesday. Mraz said the IDA and Stag have to complete the process to terminate the lease within 90 days, or by Dec. 6.
The IDA on Friday approved conveying a deed for the property to another one of Stag Industrial Holdings, LLC's subsidiaries - Stag Gloversville 3, LLC. The IDA also authorized a payment of $1,525 to Fitzgerald, Morris, Baker & Firth of Glens Falls for legal services rendered in the transaction.
The lease involving Epimed includes a provision whereby a payment is due the IDA if the lease is terminated early. This payment would be due at closing, and Mraz said the estimated payment due is $12,166.
Mraz said impacts of early termination of a lease agreement not only include having the existing lease terminated, but the Payment In Lieu of Taxes agreement terminated. The Epimed property will no longer be tax exempt and the property will immediately return to the tax rolls. The property will start making tax payments and not PILOT payments.
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.