For ex-mill on the Delaware: Industry jobs - and boating, too?

The northeast tip of Delaware, which borders Marcus Hook, Pa., home to the busy Sunoco Logistics gas-industrial construction site, got hopeful news of its own last month when a St. Louis-based industrial-land recycler, Commercial Development Co., said it was going to buy the shuttered 425-acre Claymont Steel site, with its 1,000-foot waterfront, also fronting the railroad and I-95.

Commercial Development boss Randall Jostes told state and local officials his firm hopes to demolish the century-old mill, clean the property, and offer sections to new industrial employers. Russian owner Evraz Steel had closed the electric mill in June, amid a worldwide collapse in steel prices, seven years after buying it for $564 million from a group of U.S. investors. 

It's a little soon to celebrate: Commercial Development, part of the group that bought the ex-Bethlehem Steel site in Sparrows Point, Md. two years ago, and sold it to other investors earlier this year, hasn't yet closed on the Claymont ground, notes John Cartier, New Castle County councilman for Claymont. "I'll believe it when a new deed is recorded and the county gets a transfer tax payment. Til then it's all talk. Nice talk, but talk," Cartier told me, in the paneled county council meeting room in Wilmington.

Public officials expect at least part of the property -- the mill area and yards along Gov. Printz Blvd. and U.S. 13 -- will remain industrial. "This was an employment generator, and we're concerned about employment and careers and jobs," says Cartier.

He calls Sunoco Logistics' overhaul of the longtime Sun Oil Co. refinery into the Mariner East gas processing facility "a very exciting development" that will give neighboring Delaware "a competitive advantage" by supplying high-quality, low-cost ethane and other industrial materials and fuels. "That's a very fortuitous situation for this area. The Sunoco Logistics people are looking at allied manufacturing on these sites." They'd like customers nearby, Cartier says.

What about a gas port? That's prohibited under the Delaware Coastal Zone Act (since Delaware controls the river at this point, the law has also prevented gas shipping through ports in part of South Jersey,) Cartier says. Easier to ship it through the terminals at the Hook.  

With its heavy-industry designation dating back at least to the steel plant's World War I foundations, there are no plans to restrict industry at the Claymont Steel site, the way the college town of Newark did at its former Chrysler plant site, which ultimately derailed a proposal for a billion-dollar gas power plant/data center, Cartier says.

But the riverside land east of the railroad -- accessible to vehicles only through a sand road and a tunnel under the mill -- has grown back up in timber in recent decades, and that has some wheels spinning, too. "We have a greatly underutilized riverfront here that could be set aside for marina development," says Cartier.

He notes there is a scarcity of dockside space between the Summit North marina where he keeps his 28-foot boat, Firefly, more than 30 miles away down the Chesapeake and Delaware Canal, and the Corinthian Yacht Club to the north of Claymont, in Essington, Pa. 

Cartier says the Claymont property adjoins the tip of Fox Point State Park, former DuPont Co. and Pennsylvania Railroad industrial land that was capped and planted for recreation in the 1990s, but remains fenced off from the mile-wide river.

The Claymont Steel waterfront, though it includes the ruins of old piers next to the busy Oceaport site on its north end, is mostly farther from the Delaware ship channel than at Fox Point, Cartier says; so the river there makes a better shelter for small boats.

"We could link that in a promenade, and open riverfront access" by bike and footpaths, to neighborhoods like the 900-unit under-construction Darley Green townhouse development (prices around $250,000), and the Claymont Septa station, which draws 350,000 riders a year and has been targeted for an update and new parking. Maybe the Claymont Fire Co. could get its marine unit back, after many years' absence, Cartier adds.

The county has already asked Rosen Group, owner of the aging Tri State Mall just north of the mill, which is about to lose its Kmart, to consider a redevelopment of its 40-acre property, Cartier said.

"When we had an active steel mill none of this was feasible," the councilman told me. "But now the whole northeast of this county is really in play. We need to do a master plan."   

The county and the state of Delaware missed out on a fat windfall when Evaz bought the plant, Cartier told me. "The state is supposed to collect a 1.5% (property transfer) tax. Plus 1.5% for the county. But there was a loophole when you had a stock company merger," and neither Evraz nor the buyout-firm sellers, who had loaded the company with debt and paid themelves more than $200 million in in dividends before selling to Evraz, paid transfer tax. "We got screwed," Cartier added. State law has since been tightened, he said.

Back in 2007, with the mill a going concern, the state and county were grateful to keep it open and nearly 400 steelworkers employed. This time, Cartier insists government will get its fee.