Cost estimates to rehabilitate an old foundry are too much for the local port district, forcing the sale of the complex to be moved back.
The sale of a long abandoned foundry building in Mapelton, viewed as the key project for an evolving local port district, has been pushed back to fall after cost estimates to rehabilitate it were too expensive, officials said Tuesday.
Representatives with the Heart of Illinois Regional Port District, or TransPORT, are confident, though, they will be able to purchase the 1.2 million-square-foot plant sometime this fall.
"We’re moving forward with the deal," TransPORT Executive Director Steve Jaeger said, referring to negotiations between his organization and Caterpillar Inc., the longtime owners of the huge industrial building that hasn’t been used since the late 1980s. "Both sides want to see the closing take place."
Originally, a closing on the property was scheduled for May 23, but that date was pushed back after TransPORT officials learned the cost to rehabilitate, re-roof and remove asbestos, among other things, was prohibitive.
Under a June 2006 memorandum of understanding between Caterpillar and TransPORT, the building was to be sold to the port district for $4 million. A mortgage on the property was also agreed to be paid off in 15 years, or as redevelopment deals were made.
Cost estimates to rehabilitate the structure were originally cited at about $6.5 million, but Jaeger and Dan Silverthorn, director of the TransPORT board, said estimates returned earlier this year were more than anticipated.
Concerns were raised after PSA Dewberry, a Peoria-based design and engineering firm, returned an estimate to renovate a 3,500-square-foot office building at the front of the old foundry complex.
"It looked like it would be more (expensive) to rehab it than build a new one," Silverthorn said.
Neither Jaeger or Silverthorn could cite updated cost estimates to rehabilitate the entire foundry complex, saying the estimates were based on complicated square footage figures, among other factors. Jaeger did say the cost was "substantially" more expensive than the actual $4 million purchase price for the building.
"The ability to promote this at the price (Caterpillar) was considering wasn’t really going to work," Silverthorn said.
Caterpillar spokesman Rusty Dunn said the Peoria-based corporation wants the deal to work but declined to speculate on when an agreement might be reached.
"The intent is still there," Dunn said. "The positive energy is still there to be successful. The end game for everyone is economic development and jobs."
Silverthorn and Jaeger are just as optimistic.
"Sometime things get slowed down and it takes a while to wade through it all," Silverthorn said, adding that no one should view the delay in buying the property as "a problem."
"We will definitely do something on that property."
The old foundry building, which is about the size of 10 Wal-Mart Supercenter buildings, is located along a row of industrial plants on U.S. Route 24, east of Mapleton.
Unused largely since Caterpillar moved its foundry operations into another facility, the abandoned plant is targeted by TransPORT for its first major project. In January, the port district imposed a goal of having the plant 43 percent occupied by the end of 2007 and at least one large occupant moved in.
"It’s extremely important to us," Silverthorn said about the project. "We need a big win to show the community what we’re doing."
TransPORT was formed several years ago as an economic development engine with the objective of creating industrial and transportation employment for the region of Peoria, Tazewell, Woodford, Mason, Fulton and Marshall counties.
John Sharp can be reached at (309) 686-3234 or email@example.com.