I am pretty gung ho about Dallas getting a Costco within the city limits. Even if it means we have to bribe them with $3 million. I think the returns for the city will be worth it, well worth it: sometimes you have to spend money to make money. The City Council will apparently debate this Wednesday. Digging into their own membership information, Costco has projected that existing members who live south of LBJ will spend more than $40 million a year in this store. (Costco apparently makes the bulk of their profit from memberships, so they track them carefully.) That’s $40 million now being spent in other Metroplex area stores, NOT in Dallas. Have you ever been to a Plano Costco on a Saturday? Grand Central Station. As for giving Costco $3 million in economic incentives, I’m not turning cartwheels about it, but turns out we bribe a lot of businesses to move here, as many metros do. The hand-outs are carefully selected to bring us something in return. It’s an investment in our future.
Reading over city documents outlining the Costco proposal, turns out we are also giving the ad agency Saatchi + Saatchi North America, Inc. a $75,000 bribe to move into the new McKinney & Olive building in Uptown.
According to knowledgeable sources at Dallas City Hall, Costco has said the Dallas store at Churchill and Coit off 75 will be their most expensive store in the USA. More expensive, even, than the New York City and San Francisco stores. As one of the top three in the U.S., it will be a prototype and garner attention. Costco has been looking to build in Dallas city limits for more than a decade. The land they have a contract on is owned by the Texas Department of Transportation and by state law, must sell for appraised value. Which in this case is $16.5 million for a little over 13 acres. That’s about $29 a square foot or $1.2 million per acre, not an outrageous price. Costco’s contract is pending Dallas forking over that $3 million incentive.
The other thing: the TxDOT property has been on the market for 20 years — fallow, producing zilch for the city, for us. Why the state could not lower the price tag on it to move it remains a mystery, unless there is a criss-cross of legislation somewhere. The lot was used to stage construction for LBJ. It is a mass of concrete and curbs, parking spaces, a few straggly trees and a bump or two of green. The area is surrounded by commercial real estate and multi-family living. (more…)