Three weeks before Costco's scheduled Feb. 6 opening, wooden palettes loomed overhead in tall stacks on the concrete floor of the goliath warehouse. At one corner of the store sat a cluster of boxed flat-screen TVs arranged neatly on palettes, ready for customers; at the other, power tools screeched.

The members-only warehouse store—on the southwest corner of the Grand Parkway and I-10—is the latest in a string of major commercial and industrial developments underway in the Katy area. Many of the developments, like a new claim center for Geico at Mason Creek Office Center, have been aided by the Katy Area Economic Development Council. The group is now celebrating its 10th year of operation.

"It was a great year, especially with the Geico announcement, Costco and the Igloo project, which is a success on the industrial side," KAEDC President Lance LaCour said.

Selecting a site

Costco was initially weighing the Grand Parkway/I-10 location and another spot near Katy Mills Mall.

The company began building the store in late July, just weeks after the Houston City Council approved a tax abatement reimbursing it for up to $1 million in infrastructure expenses. Houston will receive an estimated $8 million in sales tax revenue over time.

Though the city of Katy does not stand to reap tax dollars from the massive store—only Katy ISD does—the opening is still a boon to the area, LaCour said.

Roles of the KAEDC

The KAEDC plays various roles in smoothing the way for incoming businesses. In Costco's case, it provided a venue for interviews and the orientation sessions the company held for approximately 170 employees hired locally, Costco manager Dan Leonhardt said.

With other projects the KAEDC helped coordinate the development from the ground up, such as the announcement in 2007 that Rooms To Go would bring a 1.2 million-square-foot distribution center and a 90,000-square-foot outlet store.

The EDC was also active in the deal with Geico, whose employees began moving into the Mason Creek Office Center on I-10 in December. The insurance company plans to bring about 1,000 new jobs and $8.5 million in capital investment to the area over the next five years.

"Lynch pin" projects in the group's portfolio, such as Geico and Rooms To Go were aided by the coordinated effort that only an EDC can provide, said Stan Stanley, founding president and now board member of the KAEDC.

"When we started the EDC, we knew Katy was a great bedroom community," Stanley said. "But the tax rates inside Katy ISD were going to rise if businesses weren't recruited into the area to widen the tax base," he said.

Among the reasons the group was formed was to try to get the Walmart distribution facility that ended up in Sealy, said LaCour, who was hired in October 2005 after a national CEO search.

"Basically we weren't considered because we didn't have a formal economic development plan in order," he said. "I heard that quite a bit when I first came here."

If property tax rates are any measure, the KAEDC has been successful. The Katy ISD tax rate was rising when the group was formed but began to decrease in 2005 and finally leveled off in 2007. Since then, it has remained the same at $1.5266.

Looking ahead

The recent Geico deal is indicative of the KAEDC's redoubled focus on recruiting corporate offices and headquarters, LaCour said. With that project it was essential that the building was ready to lease as soon as possible.

"They finished the building in July and Geico signed in September," LaCour said. "If we didn't have the spec building, we might not have gotten the project."

Along similar lines, the KAEDC is involved with recruiting companies for a variety of projects totaling over a million square feet of space in the Grand Parkway and Mason Road area.

Now that the Grand Parkway Segment E, between Katy and Cypress, is complete, the area will see much more activity, he said.

"When you're trying to sell a piece of property and there is no road, it's difficult for people to see the possibilities," LaCour said. "Once there is a road, you can see the property much better."

LaCour said the group is also looking to recruit companies that manage warehouse-sized computer servers. There are several potential projects in the works, he said.