ANDOVER — A large office building at 800 Federal St. has sat vacant for seven years.
But Schneider Electric, an international energy management company, is eyeing the property to consolidate several of its area operations. The move would increase the town's commercial tax base and bring an estimated 600 jobs to town, according to town planners.
The Paris-based company has area locations in North Andover, Billerica and Andover.
"This area has been identified as a research and development hub for us going in the future," said Matthew Volpe, regional facility manager for Schneider. "We are looking to consolidate a lot of our groups together for the synergy that it offers us as a group."
To help make the move possible, the town is working with the company to develop a Tax Increment Financing (TIF) agreement.
The agreement would give Schneider Electric a temporary property tax break on a planned $27 million expansion and improvement project. The company hopes to add 67,000 square feet to the existing 160,000 square foot building.
The improvements would increase the property value from $8 million to $20 million, therefore increasing the building's annual property tax from $184,000 to about $470,000, according to Planning Director Paul Materazzo.
According to the state Executive Office of Housing and Economic Development website, TIF agreements allow "municipalities to provide flexible targeted incentives to stimulate job-creating development."
Under a TIF agreement, a property owner receives a tax exemption only on "a percentage of the value added through new construction or significant improvement," according to the website.
That percentage can be set between 5 and 100 percent. The duration of the TIF agreement must be between five and 20 years.
Town Meeting approval is required for the town to enter such a deal. Article 34 at this year's meeting asks residents to allow selectmen to enter into the agreement with Schneider Electric.