Ayer-based Horn Packaging Corp. has been given a $7.04 million tax-exempt industrial development bond from MassDevelopment to purchase and renovate a 275,000-square-foot building in Lancaster.

The Lancaster building, which was previously used for warehousing and distribution, will be renovated for manufacturing purposes, according to a statement.

"Manufacturing remains an integral part of the commonwealth’s economy and Horn Packaging’s expansion augments the sector’s strength," said MassDevelopment President and CEO Robert L. Culver. "This low-cost financing will help the business transform a warehouse into a full-fledged manufacturing facility for Horn’s many materials."

Sovereign Bank purchased the bonds.