A brand new 146,000-square-foot industrial building in Covington officially has its first tenant — Thermo Fisher Scientific.
On Thursday, the state of Kentucky unveiled a financial incentive package for Thermo Fisher Scientific, a publicly traded biotechnology company based out of Massachusetts. The company pledged to move into the recently completed industrial building located at 135 W. 38th St. in Covington’s Latonia neighborhood.
Specifically, Thermo Fisher Scientific will move its sample management and biorepository operations into a 65,000-square-foot space within the building. In addition, the company also plans to expand its Highland Heights-based central laboratory operation.
In total, the company pledged to invest $47.8 million and create more than 250 new jobs at both sites over the next eight years.
Kentucky Gov. Andy Beshear touted the company’s investment in Northern Kentucky.
“I am thrilled to see Thermo Fisher once again choosing Kentucky to locate and expand its business,” Beshear said in a press release. “I look forward to the company’s continued success here in the commonwealth as this investment adds to Northern Kentucky’s economic growth.”
On the development front, it’s been challenging to construct new industrial buildings within Covington city limits due to a lack of viable space. However, this didn’t stop Covington-based developer CovCor from trying to buck the status quo.
Last June, the City of Covington, along with CovCor, hosted a ground-breaking ceremony for the project where they unveiled plans to construct a 146,000-square-foot industrial building in Latonia — directly behind the revamped Latonia Commerce Center.
CovCor owns the eight acres of land where the building was put up, according to Kenton County property records. Cincinnati-based ARCO National was the project’s general contractor. Overall, the project cost around $17.6 million.
Covington Economic Development Director Tom West teased the news of the impending incentive package during the Covington Business Council’s monthly luncheon on Thursday afternoon.
“The city offered an incentive to Josh Niederhelman (CovCor’s Principal) for the first new industrial spec development in Covington in several decades,” West said.
Last April, the Covington City Commission approved a 15-year, $18 million Industrial Revenue Bond package for CovCor that included decreased property taxes in exchange for the prospective increase in payroll tax generated from prospective tenants of the industrial building.
Behind the new industrial building sits the Latonia Commerce Center, formerly Latonia Plaza. In 2021, a group of investors led by Niederhelman purchased the site for approximately $3.75 million.
The new industrial building joins Keller Logistics, Enzweiler Building Institute and the Covington Academy of Heritage Trades in reorienting the complex around construction trades, logistics and industrial development.
So, what is the state’s incentive package for Thermo Fisher Scientific?
The Kentucky Economic Development Finance Authority preliminarily approved a 10-year incentive agreement with the company under the Kentucky Business Investment program. The agreement can provide up to $1.9 million in tax incentives if the company hits certain annual performance targets.
Thermo Fisher Scientific must create and maintain 69 full-time jobs for Kentucky residents across 10 years, as well as paying an average hourly wage of $42.50 including benefits across those jobs. If Thermo Fisher Scientific hits those benchmarks, the company is eligible to keep a portion of the new tax revenue it generates.
Additionally, the finance authority approved Thermo Fisher Scientific for up to $250,000 in tax incentives through the Kentucky Enterprise Initiative Act, which allows companies to recoup Kentucky sales and use tax on construction costs, building fixtures and equipment used in research and development and electronic processing.
“Our central lab plays a vital role in helping our customers make timely, efficient and informed decisions about their clinical trials and ensure patient safety,” Thermo Fisher Scientific Analytical Services Division said in the release. “Our expansion will enhance their ability to advance life-changing research. We are excited to expand into Covington and grow our operations in Highland Heights as a vital part of our global labs capabilities serving our customers.”