County land at Castle selling for new business construction

“Castle is open for business.”

That’s what Merced County District 3 Supervisor Daron McDaniel is saying. That’s what the county’s economic development department is saying. And that’s what the numbers seem to be showing.

At a meeting on Tuesday, the Merced County Board of Supervisors approved the sale of three parcels of land at the Castle Commerce Center in Atwater. The board also approved intent to sell for three additional parcels. Each of the parcels are located in a section of Castle zoned for commercial and industrial use.

Once the deeds are signed for those last three “intents,” only one parcel of land is left to sell, said Mark Hendrickson, the county’s director for community and economic development. The county already is in early stages of discussions with a potential buyer for that last 1.51 acre parcel, he said. After that parcel is sold, “the county will have entirely developed that portion” of the Castle Commerce Center, Hendrickson said.

Castle Air Force Base closed two decades ago. Merced County took ownership of the 1,912 acres in 2006 and renamed it Castle Commerce Center. In more recent years, the county has worked to develop its vision for Castle. Filling this particular portion of Castle with new businesses will complete one section of the puzzle, officials say.

The new businesses choosing to build their facilities and operate out of Castle range widely: One is a barbecue catering company, another is a custom automotive business and the other is a backhoe business. The businesses waiting on the last step of approval from the board include an engineering firm, distribution business and a fencing company. Hendrickson estimates the new businesses will create about 75 jobs.

Since May 2014, nine businesses have bought property at Castle to build, Hendrickson said. Those nine businesses total about 15 acres.

“It’s exciting,” McDaniel said. “These are businesses who are seeing the opportunity at Castle. … What’s great about it is they’re purchasing the property and building their own businesses.”

In 2013, Sen. Anthony Cannella, R-Ceres, helped simplify the county’s land sales at Castle by including Merced County in Assembly Bill 121. The county and business owners have credited this legislation with jump-starting development at Castle.

Brent Jerner, who owns APG Solar with his wife, Marcia, celebrated the grand opening of his new building at Castle in May. He said the legislation, the county’s help and dependable utilities attracted him to Castle. When he was looking at property to buy, a reasonable price and central location were major objectives that Castle met, he said.

“We were able to work closely with Merced County, and their requirements were reasonable,” he said. “It’s been going good. There have been a lot of positive things.”

Jerner has taken note of all the new properties being sold near his new building. He could think of very few challenges to building a new business at Castle – maybe the permit costs, he said. For him, he said, the biggest challenge has been getting Internet service.

Besides selling land for new construction, the county also has leased every building that can be leased, Hendrickson said. Nearly 100 leases at Castle are comprised of 50 different leaseholders. Some of those leaseholders include the likes of Google, UC Merced and Sierra Flight Academy. At the end of the fiscal year in June, lease revenue at Castle was just shy of $1.9 million.

“That shows we are seeing growth and expansion at Castle,” Hendrickson said.

The next obstacle the county must tackle in developing Castle is the vacant buildings deemed unfit for occupancy. About 55 buildings need to be demolished, and the sites they occupy need to be cleared of any hazardous materials, such as asbestos, Hendrickson said. Demolition costs can range from building to building, he said. Some of the larger buildings may cost as much as $400,000 to raze.

“When all is said and done … the credit goes to those who elected to invest their hard-earned money here at Castle,” Hendrickson said.

This story was originally published July 24, 2015 at 5:57 PM with the headline "County land at Castle selling for new business construction."