The Elk Grove City Council on Sept. 9 unanimously approved an agreement for the city to sell 43.7 acres of its 96-acre property on the south side of Grant Line Road to the Kubota Tractor Corp. for $5.1 million.
Kubota Tractor Corp. is a subsidiary of Kubota North America Corp. – a multinational company that designs, builds and sells tractors and other heavy equipment.
With plans to establish their western division headquarters on the 43.7-acre site, construction on the new facility – which will be known as the Kubota Western Distribution Center – is targeted for some time this month. The facility will open during the latter part of next year.
The city purchased the 96-acre property in 2014 for nearly $4.4 million, and that property was once envisioned by the city for a Major League Soccer stadium. It was also considered as a potential site for the Sacramento County Fair.
Plans for the sports complex were abandoned last May and during the following month, the property was annexed into the city, along with 290 additional acres east of Grant Line Road.
The 43.7-acre portion of its 96-acre property is located at 10251 Grant Line Road, on the front section of that overall acreage. That section of the site was acquired by the city in its 2014 purchase for $1.7 million.
Talks between the city and Kubota began in 2018, when the company expressed interest in relocating and expanding their Lodi facility to Elk Grove.
Darrell Doan, the city’s economic development director, described the city’s acquisition of Kubota as victory for Elk Grove.
“This was a competitive, multicity and state search, one that I am proud to say that we won after a lot of years of work and effort,” he said.
Kubota plans to construct its project on 31.5 acres of the 43.7-acre site, and the remaining portion of that property will be retained by the company for future, potential expansion opportunities. There is also a 7.1-acre stormwater detention parcel.
The city will retain nearly 40 acres for future sale and development,” Doan noted.
“We will use that (additional property), hopefully for future sale and development opportunities, similar to this (project), of an industrial nature,” he said.
The project features a 631,465-square-foot building, which will be the city’s largest building.
Doan noted that the structure will be a “signature building that is a gateway into this area and a building that reflects (Kubota’s) corporate values.”
He added that the building will serve as a warehouse distribution center, with light assembly of tractors and components “before they are shipped out to dealerships.”
The site will also be home to the company’s western division offices, and Kubota University, where dealers and staff will receive training on the products sold by the company.
Kubota’s project will additionally include the construction of a new portion of Waterman Road, south of Grant Line Road to the city’s remaining parcel.
The company will invest about $60 million into the project, and it is expected that 125 to 150 people will be employed at the facility. The project will also feature about 400 temporary construction jobs.
Doan noted that in addition to the city’s future profit on the upcoming sale of its 43.7-acre property, the sale will also exceed its appraised value of $4.8 million. That appraisal was made on Sept. 1.
During the council’s deliberation on the approval or denial of the sale of the property to Kubota, Council Member Pat Hume referred to the project as a “catalyst for the economic development of nonresidential uses down in that area.”
“I’m excited that Kubota has chosen to remain and expand in the region,” he said. “I think it’s a win for us. It’s a win for the region. It’s a win for California, and I’m happy to support the project.”
Mayor Bobbie Singh-Allen expressed satisfaction with the jobs that the project will bring to Elk Grove.
She added that the project launches the development of the city’s “industrial annexation land.”
“(It lets) people know that Elk Grove is open for business,” Singh-Allen said. “I’m just real proud to welcome a multinational company here into our city.”