Construction begins on Vetter headquarters in Des Plaines

German pharmaceutical company Vetter Pharma has started construction on its $350 million U.S. headquarters in Des Plaines.

The first phase of construction at the 17-acre site at Mount Prospect and Algonquin roads began this month with renovations to the existing five-story office building formerly owned by the Salvation Army. The company's management, human resources and legal departments will occupy the building.

Reconstruction of the structure is expected to be complete by February and employees will move into the building in March, the company said.

That will clear the way for as many as 500 jobs to come to Des Plaines once the entire 1.2 million-square-foot facility is completed by 2030. Plans include a production facility, automated warehouse, offices and laboratory spaces.

In the meantime, however, renovations to the existing building include reconfiguring offices, upgrading utilities, repairing exterior masonry and lighting, and replacing the gate at the Algonquin Road entrance.

In 2018, construction is expected to begin on four new buildings with more than 700,000 square feet of production, warehouse, storage and multifunction space. It could take up to two years to build them, and commercial production might not start until 2022 because of required government certifications.

A second construction phase with two more buildings for production and warehousing is slated for completion by 2025.

The city, county and state used two tax incentives to lure Vetter.

The county approved a recommendation by the city to give Vetter a Cook County Class 6B tax incentive, which will lower property taxes for 12 years. The company will pay property taxes at 10 percent of market value for 10 years, 15 percent in the 11th year and 20 percent in the 12th year. Property is normally assessed at 25 percent.

Vetter also is receiving a grant from the Illinois Department of Commerce and Economic Opportunity.

Since 2011, Vetter has been operating a clinical manufacturing site in Skokie, which employs about 70 people.