LM Wind Power has agreed to buy the plant it leases from the city of Grand Forks for $2.3 million, city officials said Tuesday.
Built in 1998 in the Industrial Park, the 152,000-square-foot building has about that much in loans and bond payments left, city documents say.
Members of the Jobs Development Authority's Growth Fund approved the deal in March and waited for LM's reply. The JDA owns the building and its board -- made up of Mayor Mike Brown and the City Council -- will need to ratify the deal when it meets Monday.
Growth Fund members indicated they were pleased they could get the building off the city's inventory and into LM's because the purchase shows the company is committed to staying in Grand Forks.
"That's good, that's what we asked for," said Growth Fund committee member Dwight Thompson.
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Based in Denmark, LM makes wind-turbine blades, employing more than 700, making it one of the area's largest manufacturers.
LM said in September 2002 that it had intended to buy the building since moving to Grand Forks and would do so by the following spring for $5 million, the amount of loans and bonds remaining at that time.
Since then, there have been some speed bumps along the way, such as poor sales in 2003 caused by uncertainty in subsidies for wind energy developers and the ongoing recession that led to layoffs in 2009.
LM has been leasing its plant from the city for $510,000 a year. The building cost the Grand Forks Region Economic Development Corp. $5.8 million to build in 1998. The building eventually came into the city's possession, where it saw several additions to keep up with LM's need for space.
The latest assessed value of the building, as determined by the city assessor, is $10.1 million.
After it outgrew its original plant, LM went on to lease 129,000 square feet in the adjacent Noah's Ark building, also city-owned, for $1.4 million a year. As part of the purchase deal, the company would see a 25 percent reduction in the Noah's Ark rent.
