Diebold Inc. plans to consolidate several operations and employ 1,500 people at the new headquarters campus in a 500,000-square-foot building along Town Park Boulevard. The project — several years from completion — will replace the company’s current headquarters on Mayfair Road.
The route to deals involving corporate America doesn’t always travel a straight line — even if they do lead back home.
Diebold, a worldwide maker of delivery and security service systems, including ATM machines, operates inside a headquarters along Mayfair Road. It was built on a piece of property that then-local developer Glenn DeHoff sold to the company back in 1969.
Four decades later, Diebold decision-makers decided they needed a new location. A place to consolidate a handful of operations. A site that not only was large enough, but one for all to see.
“They told us it had to be very visible,” said Green Mayor Dick Norton.
Bob DeHoff, Glenn’s son, and a veteran developer too, happened to own a site like that. Never mind that Bob DeHoff’s office is on S. Main Street in North Canton, a mere 3 1/2 miles from Diebold, it took time and a third party to get the two sides together.
A broker, UGL Services in Chicago, contacted DeHoff last spring, searching for real estate. They told him what they wanted, but didn’t say they were looking on behalf of Diebold.
A couple months passed before UGL even revealed the identity of its client. Then, on Thursday — after months of discussions, more site-seeking and comparisons — Diebold announced it had agreed to buy the DeHoff property. The first mention came via Diebold’s Twitter account, shortly after 9 a.m.
Beth Borda, DeHoff’s senior director of commercial development, said the journey was typical for such a deal. “Usually, we know who is out there looking,” she said. “But there are times we’ve been surprised.”
CAN’T MISS IT
Diebold will buy 55 acres of DeHoff’s Union Square development along the east side of Massillon Road, and it holds an option to buy 36 more. DeHoff owns yet another 100 acres in the area.
The Diebold campus will be visible from I-77, where roughly 89,000 vehicles per day travel that section of interstate. The location is north of Wise Road, behind Akron General Medical Center’s Wellness Center project, which is to be fully in operation this summer.
Diebold plans to employ 1,500 people at the new headquarters in a 500,000-square-foot building along Town Park Boulevard. That road, off of Massillon Road, will be extended parallel to I-77 to accommodate the campus, ultimately connecting to Wise Road.
“We’re delighted ... we worked long and hard for this,” Mayor Norton said.
A year and-a-half ago, he and city officials were told by Diebold that the company wanted a new site. Behind the scenes, the mayor and Planning Director Wayne Wiethe worked with then-Gov. Ted Strickland’s development employees, as well as Summit County leaders on a tax break package that would keep Diebold from skipping out of state.
Page 2 of 3 - Then, John Kasich was elected to take Strickland’s place. He picked up where his predecessor left off. At a press conference in April, Kasich unveiled an array of tax incentives for Diebold, valued at $56 million. That was enough to close the door on a possible move to North Carolina or Virginia.
Diebold, though, wasn’t committed to a location in Green.
The company looked around.
“I’d give a shout out to (Kasich), Summit County Executive Russ Pry, the Summit Port Authority,” Norton said. “The whole thing was seamless. The governor made it clear he wanted to keep them in Ohio, and in northeast Ohio. But those tax incentives were good anywhere.”
Diebold expects to break ground in 2013; construction will take as many as three years to complete.
“This is another exciting step for Diebold in our journey to building a truly world-class presence right here in northeast Ohio,” Thomas W. Swidarski, Diebold president and chief executive said in a press release. “Our preferred site in Green provides us with the characteristics we coveted ... as well as continuity and convenience for our associates and a first-class presentation for our customers.”
The campus will house research and development operations, hardware and software engineering functions, and sales and marketing areas.
In upcoming months, the city of Green will assist Diebold in securing an estimated $44 million in additional tax incentives, making the total package worth $100 million, Wiethe said.
The biggest local chunk will come from three areas: Tax increment financing, job retention credits, and job creation credits (when Diebold’s consolidation is complete, it will have added 120 employees into the city).
Tax increment financing also would need approval of the Green Local Schools Board of Education. Typically, it’s a tool to finance construction of roads and utilities, paid over a term as long as 30 years. The cash for those improvements comes from diverting property taxes — most of which would have gone to the school district — to cover the bill.
Chris Burnham, executive director of the Summit County Port Authority, said that agency will act as a “conduit” owner of land for the Diebold headquarters. The Port Authority has acted similarly in Akron for recent Goodyear and Bridgestone expansion projects.
“There are many months of work to do; we’re just getting started,” he said.
As a public agency, the Port Authority qualifies for an economic incentive that will excuse the sales tax normally paid on materials purchased for construction of the headquarters.
Burnham acknowledged the steep price in tax dollars, but pointed to a tangential effect.
He doesn’t yet have Diebold figures, so he used Goodyear as an example. Goodyear, he said, buys $400 million in materials and services a year from businesses located in 41 of Ohio’s 88 counties.
Page 3 of 3 - Burnham said he believes Diebold considered locations in Canton, as well as in other areas of northeast Ohio.
Diebold’s Swidarski praised Canton in his press release. He noted 70 percent of the company’s local workers live in Stark County, and he referred to its 140-year-old connection to Canton.
“Canton Mayor William Healy and his staff were very proactive with us and did a great job putting together a very compelling, aggressive plan for a potential site,” he said.