Lil’ Drug Store proposes new office, distribution center

Lil' Drug Store Products has proposed an expansion that would have the company build a new headquarters and distribution center just east of Interstate 380 in southwest Cedar Rapids.

The Cedar Rapids-based company plans to construct about 100,000-square-feet of office and distribution space along Earhart Lane SW, south of Wright Brothers Boulevard SW. The project would cost about $13 million, city documents show.

Chief Financial Officer Jeff Pitz said the project is dependent on city and state approvals. Designs and a timeline are still in the works, but Pitz said the company would like to start construction this summer.

Cedar Rapids City Council will review the proposal for the first time Tuesday.

Lil' Drug Store's project would have the company move about 11 miles south of its current location, 1201 Continental Place NE. The new office and distribution center would be just south of Pearson Education's location.

The site would be perfect for the company, Pitz said, because of its easy access to I-380.

'This area really fits who we are and what we want to do,” he said.

Founded in 1974, Lil' Drug Store supplies health and beauty products, such as travel- and trial-sized pain relievers and cough medicine, to convenience stores, gas stations and other clients. Chris and Suzy DeWolf own the company.

Pitz said the company has experienced growth, both in clients and products it distributes, in recent years.

'We anticipate that (growth) to continue and, quite frankly, we're just going to outgrow this facility at some point,” Pitz said. 'We lease now and we see this as an opportunity to invest into the city and the business.”

Lil' Drug Store has requested both city and state incentives for the project.

Incentives from the city include a reimbursement of 50 percent of the new taxes generated by the expansion. An additional 25 percent reimbursement would come should the project qualify for LEED Certification, a measure of a building's energy efficiency.

City staff expect the project to generate $3.8 million in new taxes over 10 years, city documents show. Lil' Drug Store would be eligible to receive about $2.3 million in tax reimbursements, should an agreement with the city move forward.

In exchange for the incentives, Lil' Drug Store has said it will retain 45 jobs and create 11 new positions. The company currently has 56 employees nationwide, 45 of whom are located in Cedar Rapids.

The Iowa Economic Development Authority is expected to review the project May 19.

Preliminary drawings, presented before a city commission earlier this month, show the initial 100,000-square-foot building. It would have enough room, though, to add another 99,000 square feet under a future expansion.

The drawings also show an expansion of Earhart Lane south to accommodate the new building.

l Comments: (319) 398-8366; matthew.patane@thegazette.com