Corporation Service Co. may get state land deal with Wilmington building plans

The News Journal | by Jeanne Kuang

Corporation Service Co.’s recent purchase of a Wilmington office building comes with a deal to buy from the state of Delaware a riverfront parking lot next door.

The Delaware Department of Transportation plans to sell the lot at 110 S. French St. at the company’s request. The proposal was included in Gov. John Carney’s requested bond bill, introduced last month.

The company bought the adjacent office building, which is next to the Wilmington train station, in January for an estimated $4.8 million.

It plans to renovate the building into an “innovation hub” and project space for the company’s employees around the world.

There are no plans to move a significant number of workers to Wilmington from the 17-acre headquarters campus the company opened in Greenville 2½ years ago, according to the company.

CSC is the state’s most politically influential registered agent company, and for more than a century has helped cement Delaware’s status as a world “corporate capital” by providing businesses with legal, financial and other services.

The company intends to use the building’s proximity to the train station and new transit center to attract businesses and new employees to Wilmington, CSC Vice President Scott Malfitano said.

“Once we found out who owned [the parking lot], we approached DART,” he said. “We really want to invest in the city, to get our people down there. When we talked to our teammates at CSC about a move to a city, they said, ‘What do we do about parking?’ and this is a really terrific solution.”

The proposal in the bill is worded to allow Delaware officials to bypass its ordinary process for selling state property. State law requires that a commission check that no other government department needs the property before declaring it surplus, and then determine the best way to sell or transfer it to ensure it’s used for “a public purpose.”

The proposal instead directs DelDOT to sell the lot to the “current lessee.” CSC signed a lease for the lot in December, contingent on its purchase of the office building.

If the CSC sale is approved by legislators, the company would pay the lot’s market value, as determined by an appraiser approved by both DelDOT and CSC.

Carney’s spokesman Jonathan Starkey said the sale would “help accommodate the company’s growth in the city of Wilmington.”

“CSC is creating good jobs and making significant investments in the city,” he said in a statement. “That’s great news for Wilmington and for our state.”

CSC will begin to pay $13,000 in monthly rent when the new nearby transit center opens this year, according to the lease, but gets early access to the lot to start the office building improvements. Internal demolitions will begin this week, Malfitano said.

It’s not uncommon for the state to transfer its property to a specific owner through legislation rather than the process through the state surplus real estate commission, said Office of Management and Budget spokesman Bert Scoglietti.

Most of the state property transfers approved in recent bills have been to another government agency or a nonprofit.

Last year lawmakers gave the Delaware National Guard permission to sell a parcel of land in Milton at market value to one of three neighbors, or to the general public if the neighbors weren’t interested.

C.R. McLeod, a spokesman for DelDOT, said he did not immediately know whether another company had leased the lot prior to CSC’s agreement with the state, or whether the state had declared the property surplus.

Rep. John Kowalko, D-Newark, said he wants Carney’s administration to divulge the lot’s market value to the legislature’s bond committee before asking for the sale’s approval.

“Are they getting a market value or does this have the perception of a sweetheart deal?” he said. “I want to know the details, since it’s not being sold or let to a charitable organization. We’re talking about private business here.”

CSC was the second business this year to announce operations in the Christina riverfront area.

In a taxpayer grant application, Farmers of Salem, a New Jersey-based insurance company, said it will bring 52 employees to Wilmington after an expected purchase and renovation of 1 Avenue of the Arts.

Read original article.

Posted in News Articles.