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City extends economic incentives up to $3.9M to second Costco location south of Owasso

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The city of Tulsa has agreed to provide economic incentives valued up to $3.9 million to Costco, which is scheduled to start construction soon on a second location in the city.

Signed this month by Mayor G.T. Bynum, the contract is part of the city’s Retail Incentive Program and will help with infrastructure improvements related to the build-out on the Costco store at the northeast corner of 46th Street North and U.S. 169, said Spencer Mitchell, director of economic incentives for PartnerTulsa.

After completion of the roughly 200,000-square-foot facility and a year of operation, the program will return 20% percent of the unobligated city sales tax (2%) to the company annually for 15 years or until the total of the incentive reaches $3.9 million, whichever occurs first, Mitchell said.

The pact stipulates that as part of the $19 million development, the membership-only warehouse club must create at least 125 jobs, hold at least one workforce recruiting event in District 1 or 3 prior to opening the facility and partner with the local food bank to donate excess food. The facility is scheduled for completion in May.

In April 2016, Costco opened its first store in Oklahoma at 10220 S. Memorial Drive in Tulsa.

The city used its retail incentive policy to support public infrastructure for that store, as well as for the WinCo Foods supermarket that opened in early 2020 at 7130 S. Memorial Drive, said Kian Kamas, executive director of PartnerTulsa. More recently, the program was implemented to back a legacy shopping center (West Highlands Shopping Center) in west Tulsa.

A few years ago, the program was amended to provide for the support the revitalization of existing shopping centers and infill projects as part of a strategy to back small to mid-sized commercial projects, she said.

Costco Wholesale Corp. operates an international chain of membership warehouses — mainly under the “Costco Wholesale” name — that carry brand-name merchandise at substantially lower prices than typically found at conventional wholesale or retail sources.

The warehouses are designed to help small- to medium-sized businesses reduce costs in purchasing for resale and for everyday business use. Consumers also may purchase for their personal needs.

The Issaquah, Washington-based company Costco currently operates 830 warehouses, including 574 in the United States and Puerto Rico, 105 in Canada and 40 in Mexico. In May, it posted earnings of $1.35 billion in the third quarter of fiscal year 2022, a 10.6% increase over the same span the previous year.

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