Textron considers move from Slidell city-owned building | NOLA.com

After nearly six years of paying rent to the city of Slidell, defense contractor Textron Marine & Land Systems is considering leaving a city-owned office building, a move that would leave city officials with the task of plugging a $1 million hole in next year's budget. Textron Marine & Land Systems has said it will notify Slidell in mid-November about whether it will negotiate a new lease.

The company located its headquarters in the former Defense Information Systems Agency building at Gause and Robert boulevards in 2007 on a three-year lease. The contract was renewed for another three years in 2010. It expires in May.

The company, which occupies the vast majority of the 100,000-square-foot building, pays about $2 million each year in rent. The city pockets about $1 million after the costs of maintaining the facility, city officials said.

Questions about the future of the lease come in the midst of a slump in city sales tax revenue and the threat of city employee layoffs in January.

The setback with Textron sparked a spat between the mayor and City Councilman Joe Fraught over the best way to convince Textron to stay. Mayor Freddy Drennan said Fraught has acted as an overly aggressive salesman in making pitches to Textron. The mayor said he believes Fraught will be responsible for "single-handedly driving them away from the city of Slidell."

In response, Fraught said he believes the mayor hasn't been proactive enough in pursuing Textron's lease renewal. Fraught said in talking with the company, he has used his three decades of experience in the real estate industry, including relationships he established with Textron officials during the original lease negotiations in 2007. Fraught was on the City Council then as well.

Fraught said he thought it was "prudent on our part" to stay in touch with the company, rather than take the mayor's position of waiting to hear from them. But he disagreed with the mayor's characterization of him as too aggressive.

Drennan said he has met with the company, and they're simply not ready yet to enter negotiations. He said the company reported being approached by other property owners and is considering those offers, "which I don't blame them -- I would too."

"They have not told us they're leaving," Drennan said.

Fraught said the company is considering relocating its headquarters to Stennis Space Center across the state line in Mississippi.

Textron released a statement in response to a request for comment: "We are reviewing our options like any business would when a lease comes up for renewal," the company said. "We have a great relationship with the city of Slidell and have committed to providing them an answer in mid-November."

Meanwhile, city officials are reporting a slump in sales tax revenues that could leave the city with a $1 million shortfall this budget year, which ends June 30. A departure by Textron wouldn't affect the city until the following budget year, the mayor said.

Fraught said that while the city has a $43 million budget, it has only about $7 million of disposable income to use beyond the costs of daily operations and other fixed expenses. In that context, the $1 million profit from Textron's lease represents a hefty chunk of the city budget, he said.

Textron's building, a Slidell landmark, was built by NASA in the 1960s as a computer center. The Defense Information Systems Agency moved out after the Department of Defense consolidated bases in 2005.

Earlier this year, Textron, a manufacturer of armored?combat vehicles, won a $213 million contract for design and construction of what the military calls a ship-to-shore connector vessel.

Source: http://www.nola.com/politics/index.ssf/2012/11/textron_considers_move_from_sl.html

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