The Knoxville News-Sentinel
By Roger Harris, The Knoxville News-Sentinel, Tenn.
Mar. 1--Jewelry Television announced Tuesday that it will delay until 2008 construction of a planned $20 million, 300,000-square-foot headquarters at Pellissippi Corporate Center.
The Knoxville-based 24-hour shopping network originally planned to start construction of the new headquarters this spring and occupy the building in 2007.
However, stronger-than-expected sales growth in the fourth quarter of 2005 made it imperative to find additional space immediately, company officials said.
To take care of its current space needs, the company has leased the former Peeble's warehouse, a 112,000-square-foot building at Parkside Drive and Hayfield Road that is about one mile from the current Jewelry Television headquarters at 10001 Kingston Pike.
Financial terms of the lease were not disclosed.
"We had another incredible growth spurt during the recent holiday season. There is no way we can sustain current growth levels for another year with the space limitations we're facing. It's an enviable dilemma, and we're pleased to have found additional space close by," Joe Fields, chief operating officer, said in a press release.
Jewelry Television's revenues have grown exponentially over the past eight years from $5.2 million in 1997 to $390 million in 2005.
The company looked into accelerating construction of a portion of the Pellissippi Corporate Center facility, but the contractor said it could not be done in time for the crucial 2006 holiday season, Vice Chairman Charles Wagner told the Knox County Industrial Development Board's application review committee Tuesday.
Jewelry Television decided its best option was to lease the former Peebles building and take more time planning construction of its new headquarters, Wagner told the committee.
The company asked the committee to support proposed amendments to a tax incentive plan that would reflect the new construction schedule. The application review committee voted unanimously to recommend that the full Industrial Development Board approve the proposed amendments subject to negotiation of final details, which will be presented prior to the March 14 IDB meeting.
Under terms of a 20-year payment-in-lieu-of tax incentive plan approved by the IDB in June 2005, Jewelry Television would pay the board $275,000 annually in lieu of county property taxes. IDB would use the payments to finance money it would borrow to buy land for new business parks.
In exchange for delaying construction of the new Jewelry Television facility for two years, the company would sign a ground lease on the 50-acre Pellissippi Corporate Center tract and begin making in-lieu of payments immediately, Wagner said.
Financial terms of the original deal in effect would stay the same, but the IDB would receive an additional two years of in-lieu-of tax payments to cover the time before construction on the new headquarters start in 2008, IDB consultant Jim Harrison said.
Jewelry Television employs approximately 2,000 workers and sells jewelry, loose gemstones, castings and jewelry-making tools on its program that is aired nationally on cable, satellite and broadcast TV channels.
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