It’s no longer a rumor: Costco is coming to Murfreesboro.
The Rutherford County Industrial Development Board (IDB) on Wednesday approved a payment in lieu of taxes (PILOT) deal for the retailer to build a store on 18.61 acres off New Salem Highway and Warrior Drive in the West Point business subdivision. The site is behind a RaceTrac convenience store that is under construction.
Rumors have long swirled about the world’s second largest retailer coming to Murfreesboro, but nothing official had ever been announced, until now.
Realtor John Harney of The Parks Group, who is representing Costco, said he could not give a time estimate for the opening, but the site is currently being cleared.
For five years, the retailer will pay 32 percent of its real property taxes, IDB Chairman Bill Jones said. The incentive could work out to about $992,569. The company would pay an increasing amount of its real property tax bill every year during the term of the deal. The total tax payments made in the five years would be $467,091.
In return, the city and county will receive the sales and other taxes generated by the store. In order to be conservative, the IDB took the amount of sales for those five years that Costco said it would make and cut the amount by 50 percent, Jones said. Conservatively, the IDB expects the community to take in just over $12.2 million in tax revenues over five years.
The IDB estimates 225 people will be employed with wages ranging from $49,920 to $60,000.
The cost to construct the 148,000 square foot building would be about $20.8 million, according to the IDB. The store will have about $6.5 million in equipment.
Costco joins several other announced projects for West Point, which faces the Interstate 24 ramp at Exit 80 at New Salem Highway. Other tenants include U-Haul, a Lazydays RV dealership, a shooting range/retail store by Murfreesboro Armory and The Outpost Armory, and an aerospace manufacturer whose name has not been released.
The tax deal will not have to go to the county or the city for approval, Jones said, because of the high rate of return from tax collections – a 12.3 benefit-to-cost ratio.