Tacoma Port Commissioners today authorized the sale of the Port of Tacoma’s 745-acre Thurston County property.
Maytown Sand and Gravel, a limited liability corporation made up of principals from Southwind Realty Group and Lloyd Enterprises, offered a combination of cash, sand and gravel, long-term interest revenue and proceeds from any future property sales.
“While this deal doesn’t recoup the Port’s full investment immediately, in the midst of the worst real estate market in decades, it still addresses three critical Port goals,” said Commission President Don Johnson. “This sale frees up Port capital to reinvest in Pierce County, returns a valuable piece of industrial property to Thurston County tax rolls, providing much-needed tax revenue and jobs there, and provides a plan for long-term habitat conservation.”
The sale authorized by the commission includes $8.5 million in cash, $8.5 million in sand and gravel at current market prices, interest income at 7 percent over the term of the sale contract, and proceeds from any future sale of smaller pieces of the property.
The sale is expected to recoup somewhere between $23 million and $30 million over the 20-year term of the sales contract. The total depends on gravel market fluctuations and any future property sales.
To date, the Port has invested about $27.5 million in purchasing and enhancing the Maytown site.
The Port bought the property near Maytown in 2006 for $21.25 million as a potential site for rail system enhancements.
The Maytown site was one of several regional sites evaluated through a joint effort between the Port of Tacoma and the Port of Olympia. Since the property was larger than needed for rail staging, the ports also explored adding revenue-generating, rail-dependent industries to the site.
After purchasing the site, which once housed an explosives manufacturing plant, the Port of Tacoma assumed responsibility for environmental cleanup under an Agreed Order with the state Department of Ecology. The Port completed a cultural resource inventory, cleaned or removed contaminated soils, pulled invasive weeds by hand, removed unsafe structures and continued monitoring groundwater for contamination.
The Port also vested the property’s existing gravel mining permit. The permit, which notes the property contains “mineral lands of long-term commercial significance,” includes a reclamation plan to build and maintain habitat after the approved amount of gravel is removed during the permit’s 20-year life. The reclamation plan was based on an agreement among several groups with conservation interests, including Capitol Land Trust and Black Hills Audubon Society.
A slowing economy, reduced container imports and uncertainty about mainline railroad investments reduced immediate need for port- or rail-related development. Nearby Thurston County residents also expressed concern about expanded industrial activity on the property.
Both port commissions decided to allow their interlocal agreement to expire June 30, 2008, and the Port of Tacoma announced plans to sell the property.
In September 2008, the Port of Tacoma hired CenturyPacific LP to market and facilitate the sale of the Maytown property. The bid process resulted in proposals from four parties, including California-based Southwind Realty Group and Lloyd Enterprises, based in Federal Way.
Today’s action is the result of negotiations with the parties to secure the final terms of the purchase and sale agreement and several additional agreements that outline other terms and conditions. Escrow is scheduled to close at the end of the month.
