Toronto-based Celestica announced May 13 that it would expand its operations of manufacturing advanced electronic equipment at two sites within the AllianceTexas development.
What's happening?
According to its website, the company is a global leader in data center infrastructure and advanced technology solutions. The announcement came one day after Fort Worth City Council approved a 10-year tax abatement with the company.
“It is in our target industry,” said Cherie Gordon, Fort Worth economic development coordinator of Celestica. “It's an electronics manufacturer. It serves several of our target industries in smart building, aerospace, defense and health tech.”
The project would create 1,715 full-time skilled jobs across manufacturing operations, engineering, supply chain and quality assurance, according to a news release. There will be more than 1 million square feet for advanced manufacturing and engineering space.
According to an April 28 Fort Worth City Council work session, the locations will be at 15301 N. Beach St. and 15500 N. Beach St., both in council District 10.
The company has 13 other locations in North America, including one in Richardson. Gordon said at the work session that Celestica already has a lease for 15301 N. Beach St., which is a $140 million project, according to a filing with the Texas Department of Licensing and Regulation.
What you need to know
Council approved a 10-year abatement at 80% incremental city real and business personal property tax, or BPP, subject to some qualifications by Celestica.
There is a requirement for a minimum of 1,715 full-time jobs, and there will need to be 490 jobs by Dec. 31, 2028, at Site 1, which is at 15301 N. Beach St.
Site 2, 15550 N. Beach St., is currently vacant land, according to the work session presentation. By Dec. 31, 2029, Site 2 will need to have a minimum of 1,225 additional jobs.
The average minimum salary will be $75,000, Gordon said.
Celestica is required to have a minimum capital investment of $176 million in real property construction costs and $224 million in BPP at Site 1 by Jan. 1, 2028.
At Site 2, the requirement is $224 million in real property construction cost and $252 million in additional BPP by Jan. 1, 2029.
The incentives are estimated to be covered seven years into the 10-year term, according to the April 28 presentation. The city would see a net new tax gain of $10.4 million in 10 years, and the abatement would save Celestica $41.7 million, Gordon said.
Zooming out
The expansion in Texas is to meet the surging global demand for next-generation data center infrastructure and advanced technology solutions, according to a news release.
“In a nutshell, we’re the rocket fuel for the current AI boom,” said Alex Chang, Celestica’s vice president of connectivity and cloud solutions, at the April 28 meeting.
Earlier this year, Celestica announced plans to invest $1 billion in Mexico, Japan, Thailand and the United States between 2026 and 2027 in a news release.
What else?
Celestica would have to hire 30% local residents, and there are enhanced salary requirements tied to the abatement. BPP is subject to several qualifications by Celestica:
- Failure to meet the minimum capital investments would result in a reduction of the abatement rate by up to 10%.
- Failure to meet full job commitments results in forfeiture of the annual abatement.
- Failure to meet the minimum salary requirement of $75,000 average results in forfeiture of the annual abatement.
- For any year in which more than 50% of the individual jobs earn less than $60,00 in early, the abatement is reduced by half, resulting in a 40% abatement.
Gordon said the abatement was brought forth due to competition.
“We are in active competition, both with domestic and international locations,” she said. “The scale of the project involves major long-term implications. This is a major bet on where they're going to choose to operate this project. The incentives play an important part in boosting the competitiveness for Fort Worth.”
What they’re saying
“Celestica’s expansion at AllianceTexas further reinforces Fort Worth’s position as a leading hub for advanced manufacturing and next-generation technology infrastructure,” said Mike Berry, president of Hillwood, a development company that operates AllianceTexas. “This investment reflects the strength of Fort Worth’s infrastructure platform, reliable power capacity, strong workforce pipeline and collaborative business environment, all of which continue to attract global companies building for the future.”
