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The city of Albuquerque and an aerospace company that’s planning a large New Mexico satellite manufacturing operation have come to terms on a lease for 114.5 acres of Aviation Department land, marking a new milestone for a project that could eventually create thousands of new jobs.
The pending ground lease and development agreement requires Theia Group Inc. to develop the entire site in the next decade, including at least 48 acres by 2025, according to documents Mayor Tim Keller sent this week to the City Council. Failure to meet the development timelines would allow the city to reclaim undeveloped land.
The deal – which still needs council approval – also spells out for the first time that the Washington, D.C.-based company intends to seek economic development incentives for the massive campus it’s planning to build on the former Albuquerque International Sunport runway, though it does not specify the mechanism.
The campus could host 1,000 workers when it opens and eventually grow to 2,500, representatives have said.
Keller last fall began speaking enthusiastically about the project, while simultaneously warning that it was not a done deal. In a statement to the Journal on Friday, he reiterated that the project remains in the beginning stages, but noted this is a promising development.
“Getting the lease done puts us one step closer to adding potentially thousands of good-paying jobs for Albuquerque,” Keller said. “It’s still early in the project, but it just became a lot more tangible and real, and we’ll continue working closely with Theia Group to keep it moving.”
The agreement between Theia and the city could span 50 years – 30 years to start, with two possible 10-year extensions.
Theia Group has agreed to pay the city $1 million on the agreement’s commencement date – expected to be June 1 – and another $1 million a year later, according to the mayor’s correspondence.
In 2025, annual rent would rise to $1.2 million. It would increase by 2% yearly until 2030, at which time an appraisal would set payments.
Theia Group is the parent firm of Group Orion, which last year began the entitlement process for the planned Southeast Albuquerque campus. The plan includes approximately 4.1 million square feet of development, with the potential to grow. The facility will be used “for light manufacturing (assembly), laboratories, offices,” a parking structure and employee amenities, such as a food hall and day care, according to documents Orion representatives submitted to the city.
“The purpose of this large facility is to receive components, and complete the assembly, integration and testing of satellites,” an Orion representative wrote to the city planning commission last fall.
The company, which has previously declined to comment on the project, didn’t respond to an inquiry about the lease agreement.
Theia Group is developing a constellation of satellites to cover the entire planet – offering a “real-time digital representation of every physical activity, process and object on earth,” according to its website.
Keller said last fall that the company had not sought any economic development incentives, but Theia’s pending agreement with the city indicates that is in its plans.
Theia “intends to pursue certain economic development opportunities for development allowed by this agreement,” the document states. “Nothing in this agreement shall be construed to prohibit (Theia) from pursuing any and all economic development benefits with municipal, county, state or federal governmental entities at any time during the term, including, but not limited to, the issuance of industrial revenue bonds.”
A Keller spokesman said Friday that Theia has not yet applied for incentives, but the city will be “ready for that conversation if and when they start that process.”
Bruce Krasnow, a spokesman for the New Mexico Economic Development Department, said Friday that the state is not currently involved with the project and is not offering incentives at this time.
Albuquerque City Councilor Pat Davis, who represents the area where Theia plans to build, said the lease and development agreement is a significant mile marker for the Orion Center, making the project “real.”
“There’s a lot of pieces between here and the end, but the first thing in building a new house is to buy the land, and this is that piece,” Davis said.
Journal staff writer Stephen Hamway contributed to this report.