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Railex moves ahead on Powers Avenue location

By Karen Brune Mathis, Managing Editor

Railex LLC has changed tracks for development of a proposed 310-job Southside distribution center, bypassing a Philips Highway location for a nearby Powers Avenue site owned by the Skinner family.

Railex, based in Riverhead, N.Y., was negotiating for a site at 6140 Philips Highway, but soil issues led it to consider the alternate location.

The Arthur Chester Skinner Jr. Trust, listed as the landowner, filed an application last week with the St. Johns River Water Management District for development of the West Bowden Rail Yard. The site is east of Powers Avenue, just south of its intersection with Toledo Road.

“The application is part of our plan to move forward on this site, subject to working out an entrance at or north of Toledo Road acceptable to the city,” said Railex President Adrian Neuhauser in an email Thursday.

Neuhauser said the Philips site wasn’t entirely off the table, “but financially very challenging given the site soil characteristics and costs of mitigating stormwater,” he said.

“We believe this is a more viable solution,” he said of the Powers site.

Neuhauser said Railex plans on moving forward this quarter, subject to permitting and “finding an adequate access solution.”

The West Bowden Rail Yard is a 74.16-acre proposed commercial development bordered by Powers Avenue to the west and the Florida East Coast Railway railroad tracks to the east. Baker Skinner Park is to the south and a mini-warehouse development is to the north.

The land is undeveloped. It is on the west side of the FEC rail yard, while The Philips site was east.

According to the water management application, the property’s first phase will be a 40.21-acre site to be developed as a proposed rail facility and a second-phase development of 14.32 acres for commercial use.

The remainder of the property is for stormwater management.

In the meantime, Railex has opened a temporary freezer and cold storage facility in leased space at Flagler Center.

The distribution center has been planned for more than a year.

In April 2013, Railex proposed to invest $45.7 million to develop the 250,000-square-foot cold-storage warehouse-distribution center that should employ 310 people by 2018.

The jobs will pay an average of $47,851 plus benefits of $8,000. The first 200 jobs would be created in the first year.

The company serves the food, beverage, pharmaceutical and manufacturing industries.

Florida East Coast Railway owns the Philips Highway property, which is vacant land zoned for heavy industrial use. Railex proposed to buy an 18-acre tract of undeveloped rail-spur property adjacent to the railroad marshaling yard.

In May 2013, Railex negotiated $8.8 million in city and state incentives to develop the cold-storage warehouse-distribution center, but, according to the city, did not execute the redevelopment agreement.

In May this year, the city Office of Economic Development said in a memo filed with a proposed city ordinance that Railex was considering an alternate site because of soil problems.

The memo was included with city Ordinance 2014-309 that urged a one-cycle emergency passage so that the city could receive a $5 million proposed state road fund grant to support the development before the end of the state’s fiscal year June 30. Council approved it.

The project description said Railex proposed to acquire a tract of undeveloped property along either Philips Highway adjacent to the yard or Powers Avenue to construct the distribution facility and 21,000 linear feet of spur rail and support yard to handle the loading and unloading of unit trains.

Kristen Sell, a spokeswoman for Mayor Alvin Brown, said by email Tuesday that council’s final approval was based on the alternate Powers Avenue site.

She said the modified agreement was approved June 24 by a 17-0 vote with a stipulation that truck traffic to and from the site must exit onto Powers Avenue at Toledo Road or north.

The June 24 agreement, Ordinance 2014-458, also reduces the city’s financial commitment to the agreement because of the site relocation from a brownfield area to a non-brownfield area.

The original incentives package comprised the $5 million road fund grant, a $1.6 million city REV (recapture enhanced value) grant and a Qualified Target Industry grant with a local match of up to $341,000 to the state’s $1.364 million.

Excluding the brownfield bonus, the city’s QTI commitment drops to $186,000.

The June 24 ordinance gives Railex 90 days to execute the deal.

kmathis@baileypub.com

@MathisKb

(904) 356-2466

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