LIMESTONE, Maine — The Loring Development Authority has been discussing the possibility of a handful of new businesses interested in purchasing property at the Loring Commerce Centre. Two of those business ventures may be gaining even more momentum than in previous weeks, as Chinese companies Norinco Motors and Global Mega Recycle (GMR) both seem to be maintaining a high level of interest in setting up businesses at the former Air Force base. Norinco is looking to set up a rail car manufacturing business, while GMR specializes in waste disposal, particularly tires, which is what they would be doing should they choose to sign the lease option and term sheet the LDA has created.
As for potential dealings with Norinco, Flora stated at the June 11 meeting that LDA continues to make progress on this project, which would create many new jobs related to the manufacture, assembly and retrofit of rail cars.
At the June 11 meeting, Flora also revealed that he will be traveling to China to meet with officials from Norinco, along with Gov. Paul LePage. Peter Steele, a spokesman for the governor, confirmed LePage’s travel plans to the Bangor Daily News. However, he declined to name the company, as negotiations are still ongoing, but it is confirmed that the Governor will be traveling with Flora to Beijing this coming Saturday. Gov. LePage’s spokesperson also wrote in an email that the trip will include a tour of industrial and transportation facilities and discussions with leaders of the Chinese company. Gov. LePage plans to return stateside on Thursday, June 26.
During a meeting on April 9, President and CEO of LDA Carl Flora informed the board of trustees that Global Mega Recycle had previously been and is currently still interested in leasing the Alert Hangar (building 8410) and an office building (8409), while also securing a lease option, so they can soon move forward with permitting.
The purchase of the Alert Hangar complex would be for the Hong Kong-based company to carry out their self-proclaimed vision of becoming “a world class professionally managed, eco-friendly, commercially viable and sustainable global resource recovery group and be one of the vanguards and market leaders in the field of low-carbon-footprint waste tire Pyrolysis.” The company claims there primary focus is to convert high calorific waste tires into valuable renewable energy commodities.
Prior to this April 9 meeting, GMR informed LDA that they would like a heating system installed in the building at an estimated cost of $200,000. That cost would be included in the lease revenue.
In a memorandum written by Flora on June 4, he explained that conversations between LDA and GMR are currently progressing and GMR is still very interested in the prospect of leasing the Alert Hangar at Loring.
“I have developed terms for a lease with Global Mega Recycle North America Inc., for a tire recycling project, which we have discussed at previous meetings,” said Flora. “The building that would be used, the Alert Hangar, has no heat source or heating distribution system. I have allowed a generous credit against future rent of up to $200,000 for a simple heating system and interior demolition, which is more than I think will be necessary.”
Flora also stated that GMR will have to provide the cash to accomplish the necessary improvements, which he claims they are willing to do. GMR has also agreed to a limit of seven days-worth of working inventory of tires to be stored on site.
“There may be other permitting issues they will have to overcome as well,” said Flora.
The proposed arrangement would provide GMR with a nine-month option period, in which they would pay $1,000 for each month of the option period, until exercised. During the nine-month option period, GMR would investigate permitting issues and other aspects of the project, leading to a decision whether or not to proceed with the lease.
The terms of the lease state the tenant may use two of four above-ground fuel storage tanks made available by the LDA. The landlord and tenant will confer to determine which of the tanks, which range in capacity from 10,000 to 420,000 gallons, is most suitable to meet the tenant’s fuel storage needs.
The basic stipulations of the lease option are only a precursor to the environmental, general and special responsibilities expected of the tenant. The special responsibilities are related to aviation. The lease agreement stipulates that the tenant must manage its activities including exterior storage of raw and finished product in such a manner that interferes to the minimum extent feasible with the normal operations of the airport.
General responsibilities of GMR will include paying the cost of heat, electricity, water and sewer (provided by LDA and billed according to rate schedules), cost of repairs and maintenance of the building, on-site plowing and maintenance of the grounds at the premises, property and general commercial liability insurance, trash removal and waste management.
Upon execution of the lease, rent shall be assessed in the amount of $2,000 per month and shall be increased by 2.25 percent. LDA, as landlord, will credit the amount expended by the tenant for renovations, up to a maximum of $200,000, against rent due during the initial and any renewal terms.
In addition to rent, LDA officials claim the tenant will need to pay an impact and services fee of $1,000 per month. The impact and services fee will be increased annually along with the rent, in the amount of 2.25 percent. LDA will plow and maintain the general roadway system, and secure services for police, fire and ambulance.
As for potential dealings with Norinco, the ambassadors from their respective groups look to progress talks with Norinco even further.
“I will be traveling to Beijing, China as part of a delegation led by the Governor, planned for June 21 through June 28,” said Flora. “The delegation will also include representatives of the Maine Military Authority and Maine Department of Transportation.”
As of now no dotted lines have officially been signed. However, Flora holds out hope that the Chinese company will end up at Loring.
“All I can really say to explain it is that business is done a little differently in China. In America, we might figure out if the numbers work, and if they do, we go for it,” said Flora. “With the Chinese, we’re going through more of a relationship-building process, at the moment, but we’ve definitely made some soft agreements.”
