A developer intends to buy a large parcel from the city to construct a $22.5 million distribution center in Dubuque.

Construction would begin before the end of the year on the 217,000-square-foot facility that then would be leased by FedEx Ground Package System on a property located at the north end of Innovation Drive in Dubuque Industrial Center West. In conjunction, the company intends to add 10 jobs to its current local workforce of 135 full-time employees.

On Monday, Oct. 18, Dubuque City Council members will discuss setting a public hearing for a proposed development agreement in which the city would sell 34 acres for $5,144,588 to Setzer Properties DBQ, LLC, the project developer.

City documents state Setzer would construct the facility and then lease it to FedEx Ground. The proposed development agreement states construction of the building must be completed by Feb. 1, 2023. It also includes the requirement that a traffic-impact study must be conducted.

FedEx Ground already operates out of a facility on Innovation Drive. The new building would be located adjacent to it.

Reached by the Telegraph Herald on Friday, FedEx Ground issued the following statement.

“FedEx Ground is engaged in discussions with local officials for the potential leasing of a package distribution center in Dubuque. A project of this size requires careful planning and close coordination with the developer, city, county and state officials. As a matter of practice, FedEx does not publicly discuss specifics of a project until all aspects have been finalized.”

Rick Dickinson, president and CEO of Greater Dubuque Development Corp., said FedEx Ground aims to move into a new facility in order to meet increased demand.

“Our understanding is the demand for their services has exploded with the increase of web-based sales,” Dickinson said. “As a result, they need to greatly expand their footprint and the number of vehicles that can operate out of that facility.”

Dickinson said he could not comment on what FedEx intends to do with its current facility once the new structure is completed.

As part of the development agreement, the city would offer no financial incentives for the project, and Setzer Properties would agree to pay for any needed improvements to Innovation Drive and to cover half of the cost of any improvements to Seippel and Chavenelle roads if the traffic study determines any are needed.

Jill Connors, economic development director for the city, said FedEx Ground has stated it would create at least 10 new jobs by Jan. 1, 2024.

“The addition of jobs is always good for the community,” she said. “It’s our understanding that they would possibly add a few more, as well.”

Dickinson said that, in March, multiple real estate companies approached GDDC to inquire about the purchase of a large parcel in the Dubuque Industrial Center West for a major company. In June, it was revealed to GDDC that the company in question was FedEx Ground.

With Dubuque City Council’s approval, a public hearing and potential agreement approval date would be set for Nov. 22.

City Council Member Susan Farber said the agreement would greatly benefit FedEx Ground, the city and the community, pointing out in particular the property purchase price of $5.1 million.

“Those funds go to the city and give us the opportunity to help with the payment of the property by the Southwest Arterial,” Farber said, referring to a recent, $4.2 million purchase by the city of 156 acres by the Southwest Arterial and U.S. 61, which will be used for the development of a new industrial park. “I think it’s a great positive for the region.”

Council Member Danny Sprank also offered his support for the project.

“More jobs are always good,” he said. “It seems like a good project for everybody.”

Council Member Laura Roussell said the expansion of an existing Dubuque business is a sign of a growing local economy.

“It’s always great when businesses want to expand,” she said. “I always think it’s a good sign when an existing business wants to expand in Dubuque.”

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