Amazon Services Inc. is the long-held-secret negotiator for an intermodal center on the northwest side of the airport, City Attorney Tim McCausland announced this morning during a City Commission study session.
Initially, Amazon is leasing 47 acres but has an option to expand within five years to include an additional 62 acres to the west. The main facility is expected to cover 223,000 square feet with an additional 60,000 square feet in two auxiliary buildings.
“They intend to have planes in the air by next July,” McClausland told city commissioners. Construction is expected to begin July 3.
“This is a game-changer for the airport,” Airport Director Gene Conrad said. “We began talking with them in December 2017.” He billed Amazon’s construction costs as a $100 million investment in Lakeland.
Conrad described the planned facility as the biggest in the Southeast with cargo coming from all over the country.
Amazon expects to base seven jets in Lakeland, adding to its fleet of approximately 50 jets, mostly 767s and 737s, Conrad said.
The City Commission is expected to approve the lease Monday at its 3 p.m. meeting. Check lease details here or near the end of this article.
The airport started laying the foundation in 2011, putting together plans for a shovel-ready intermodal center that would cater to cargo jets, Conrad said.
Starting in 2015, airport staff secured grants and Federal Aviation Administration approval for a range of projects to accommodate that, including environmental planning and design, building stormwater infrastructure, planning runway upgrades and an additional ramp and taxiways, Conrad said.
Airport expansion grants over the last 10 years exceed $100 million, Conrad said. Most of the contracts call for a 20 percent match from the city.
Conrad was at times overwhelmed with emotion as he talked to commissioners about the project details, the long-range planning and coordination of efforts that finally brought it to fruition.
The 50-year lease includes an initial 20-year agreement with options to extend each 10 years after for the remaining three decades.
The airport will receive $80,651 a month in rent payments on the original 47 acres. Amazon will also pay landing fees of 85 cents per 1,000 pounds of cargo and fuel pump fees with a 3-cent surcharge on each gallon of fuel, McCausland said.
If Amazon expands onto the adjoining 62 acres, the airport will need to make an additional $25 million in improvements and the rent will be adjusted, McCausland said.
Once the Lakeland facility is built, Amazon will vacate its cargo operation at Tampa International Airport, the Tampa Bay Business reported in an article behind its paywall.
“We’re sorry to see them go, but this move makes sense for all parties. We had been in conversations with Amazon, but we don’t have the space to accommodate their future needs. Right now the Amazon planes are staging on the site where we want to build a new airside for passenger service, which is our primary mission,” Tampa International Airport spokesman Danny Valentine told the business publication.
“Lakeland has the room for Amazon, and the company’s interest in growing there attests to the economic strength of our region,” he said.
Amazon is aware of the needs of the community and other tenants and has agreed to accommodate the annual spring Sun ‘n Fun Fly-In and festival, as long as it is not held in July, November, December or January, Conrad said.
The online retail giant also has agreed to vacate and shut down operations for four days when the Blue Angels aerobatic team performs at the airport, Conrad said.
City Manager Tony Delgado said, “Without Gene Conrad at the helm, I don’t think this would have happened,” adding that other city teams were also coordinating to make it happen.
The project “is going to show the business community throughout the world, not only in the country, that we’re open for business,” Delgado said.
“Amazon commented to me that they have never worked with a group of people so flexible and quick t respond,” Mayor Bill Mutz said.
Amazon is seeking state and local incentives of $3,000 for each of the estimated 75 higher-paying jobs the cargo center for a total of $225,000. The incentives are for jobs that pay more than 115 percent of the median salary, which would be $46,000 to $47,000 a year. The incentive package on the commission’s Monday agenda under the Amazon proposal’s code name, Project Scythia.
Plans show that access to the Amazon air-freight facility will be from Drane Field Road.
In response to a Facebook question about volume of takeoffs, Conrad answered: “Takeoffs and landings will be throughout the day. 8 to 10 departures per day are planned for when they start. I don’t have numbers for growth but departures will increase over time.”
Amazon already has a big presence in Polk County with a 1-million-foot fulfillment center at 1760 County Line Road and a sort facility off Dean Still Road in Davenport.
Items related to the lease agreement that the City Commission will consider on Monday include:
* Approve contracts that will initiate a year-long, $2.8 million project to allow aircraft to land on Runway 9 in more adverse weather conditions. The project will upgrade the instrument landing system and visual range from a level II to a level III, allowing aircraft to land when the cloud ceiling is 100 feet (current capacity is 200 feet) and when visibility is only 1,200 feet. Currently, aircraft cannot land when visibility is less than 2,640 feet, which is a half mile.
* Make changes to the contract for the ramp and apron area. The project, which was designed with generic tenants in mind, is being adjusted to accommodate Amazon’s needs. The changes which will cost $3.17 million, include increasing the ramp size by 40 percent, switching the paving material from asphalt to concrete, and adding electrical infrastructure to accommodate ground support and a ground power unit that provides current to start jet engines. The contractor, Cobb Site Development of Wauchula, expects to start paving the ramp and apron area within the month. A grant from the Florida Department of Transportation will cover half of the costs, Conrad told commissioners.
* Expand the fuel tank farm to provide five more jet fuel tanks. Eighty percent of the half-million dollar cost for the additional tanks is coming from an FDOT grant of $400,000. The city will use an internal loan to pick up the remaining $100,000. Atkins North America is already under contract with the airport and will be tapped for professional services in the design and bidding phase, with those costs capped at $14,470. The permits already are in place for three of the tanks.
New commission member Sara Roberts McCarley praised Conrad for the proactive work. “You have seen this in the long range. The intentionality and thought that went into this is incredible.”
After Commissioner Scott Franklin commented that the airport is becoming a profit center, Conrad said the latest figures show Lakeland Linder has a $574 million economic impact on the community. And, Conrad said, the Amazon project will bring that to an annual impact of more than $1 billion.