ANNAPOLIS – Aberdeen will be getting a new business by 1997, thanks in part to state money.
Maryland’s Board of Public Works Wednesday approved a $3 million loan to help the retail chain Saks Fifth Avenue build a new distribution center in the Harford County town. The loan is part of a $43 million package to land what will be Saks’ main distribution hub on the East Coast, according to officials from the state’s Department of Business and Economic Development.
Saks operates 46 stores and nine clearinghouse outlets nationally, including two in Maryland. It plans to add 19 more by 1997, company officials said.
The company began looking into consolidating its East Coast distribution centers two years ago, said Roger Dreschler of the economic development department. “We were originally contacted by their broker, who indicated they were looking to build the distribution center in the mid-Atlantic region,” he said.
Amid negotiations with a number of states, Maryland put forth a financing package for Saks to develop a 470,000 square- foot building.
Maryland’s Constellation Real Estate Group Inc. will invest $26 million to build the center and lease it to Saks. The company is investing $11 million for equipment costs. Maryland offered both the loan and $3 million from the state’s “Sunny Day” fund for equipment and training costs.
Both Harford County and the town of Aberdeen will offer Saks tax credits — the county more than $600,000 over five years, and Aberdeen more than $1.5 million over the next 15 years.
The state loan approved Wednesday was contingent on Saks’ performance. Should the firm employ at least 375 full-time employees, the state will forgive $2 million. If Saks hires at least 200 employees, $1 million will be forgiven.
“We were assured that Saks would have no problem meeting the 375 target and will probably employ a number well over that,” Dreschler said.
Dreschler told the Board of Public Works that any costs Maryland incurs will be paid back through the economic impact of the distribution center. “The project will have a tremendous impact in Harford County and the surrounding region,” Dreschler said.
He cited department figures projecting more than $500,000 in new tax revenue directly from the center and its employees, and said there would be nearly double that in indirect benefits.
Gov. Parris N. Glendening, who chairs the board, praised the department’s efforts in bringing in businesses around the state. But he added he wanted to attract more jobs into Baltimore. “We need to get more of those type jobs into the city as well,” he said. -30-