Developer wants to build at former Superfund site in Fridley

It's an opportunity to further clean up and rebuild one of the most polluted sites in Fridley.

A Minneapolis developer who specializes in industrial cleanup and redevelopment jobs plans to acquire the old Naval Industrial Ordnance Plant site on East River Road.

Paul Hyde, with Hyde Development, wants to turn the mostly vacant 122-acre site into a business park that would be a mix of industrial, retail and office space. He hopes to start work on the site this summer.

The existing 2-million-square-feet industrial building — roughly the same square footage as the IDS Center in downtown Minneapolis — housed 4,500 workers at its height of production. During World War II, workers made naval guns turrets there.

Now, there are about 300 employees on the site working for several businesses. Parts of the site are so polluted that it was designated a Superfund site by the Environmental Protection Agency (EPA) in the 1980s.

"We want to develop a modern business park with 12 new buildings totaling 1.6 million square feet. That will be home to 50 different companies. That's a much more diverse and sustainable economic base for the city," Hyde said. "We should have almost 3,000 jobs on the site and almost $3 million in new property taxes annually."

The current owner, based in St. Louis, pays about $560,000 in property taxes each year.

Right now, Hyde and city staff are completing environmental reports and approvals. A development plan then would go to the city for approval.

"They'll purchase it, clean it up and put it back to good use creating new jobs, generating new taxes and new opportunities," said Fridley Community Redevelopment Director Scott Hickok. "It's very, very good for the city."

The city will offer assistance in the form of a 25-year tax-increment financing district to help the developer cover the cost of cleanup and redevelopment.

"As the developer spends his funds to correct soils, to demolish the building, to clean up contamination, to address some of those extraordinary expenses, he would be reimbursed from new taxes generated," said Fridley HRA Director Paul Bolin. "He will only get back his actual expenditures on eligible costs and tasks. We are still trying to identify all those eligible costs. We don't know what that final number would be."

City staff and the mayor say it's a sound investment because no developer could otherwise afford to work with such a polluted site. Eventually a new business park could create $125 million to $150 million in value, Hyde said.

The site has long been used by industry. During World War II, there was a partnership between the Navy and privately owned Northern Pump Co. Northern Pump expanded operations and established the subsidiary Northern Ordnance in the 1940s. During the 1950s, production changed to guided missile launching systems. The property has changed hands many times over the years.

In 2004, the Navy sold its remaining interest in the property to private owners.

Heavy industrial operations, including weapons-systems production, a foundry, welding, degreasing, painting operations, and chemical and fuel storage polluted the site.

Volatile organic compounds were used as degreasers. Paint sludge and spent liquid solvents were buried in pits on the site in the 1970s, before modern-day environmental standards were in place.

Remediation of groundwater and soil contamination by the Navy and other former owners has been going on for decades and has been monitored by Minnesota Pollution Control Agency and the EPA.

Based on past experience, Hyde knows that his company will uncover more pollution once demolition starts.

"We always do. We will find stuff. That's what happens when you redevelop polluted sites," Hyde said.

This is the fourth state and federal Superfund site Hyde will redevelop in Minnesota. He also redeveloped the former site of the National Lead Co. in St. Louis Park, a wood treatment facility in Brooklyn Center that is now the site of Caribou Coffee's headquarters, and another site in Fridley.

Today, the ordnance site's private owners lease space to a handful of businesses, including a BAE Systems Land & Armaments engineering group — the remnants of the defense operations on the site.

"We would love to build them a brand-new building on the site as part of the project," Hyde said.