Plant's land had another suitor: Local developer had potential use for Wolverine property

Sep 14, 2009 (The Decatur Daily - McClatchy-Tribune Information Services via COMTEX) -- WLVTE | Quote | Chart | News | PowerRating -- A local real estate developer hoped to buy the 166-acre Wolverine Tube property, but his interest disappeared when TEPPCO announced its plans.

Jeff Parker of Parker Real Estate LLC said he has been trying to get a price on Wolverine's property since June. He got one two weeks ago. The price, which was for the 146 acres not included in the TEPPCO deal, and which would require his group to clean up the environmental contamination, was $10 million.

That is more than $68,000 per acre. Based on its share price, Wolverine has a market value of $3.7 million. In its 2008 annual report, Wolverine said it was offering the full property for $3.7 million, or $22,000 per acre.

"I've been all over it. We've flown it; we've been on site. It's something we would like to have," said Parker. "Anything would be better than a tank farm."

Option sold

Wolverine sold an option for 20 acres on the west side of the property, along the Tennessee River, to TEPPCO Terminaling and Marketing Co. TEPPCO wants to build a fuel depot where barges would off load gasoline, ethanol and diesel fuel to storage tanks with a 14-million-gallon capacity. One hundred trucks a day would take the fuel to area gas stations.

The fuel depot would be less than one-half mile upstream of the sole water intake for Decatur Utilities, which provides water for almost all of Morgan County and parts of Limestone and Lawrence counties.

"We have no interest if TEPPCO goes in," Parker said. "None of the possible uses for the property are possibilities with a tank farm. Certainly you wouldn't put a residential development next to it. There's even an inherent risk of putting something industrial next to it."

Many potential uses

Parker said it is a beautiful property that would lend itself to many uses. Residential, office and commercial would work there, he said.

"If the land were available for a reasonable price and there was some sort of indemnification or warranty that Wolverine would clean the property prior to us taking title," Parker said, "we would purchase the property."

Environmental issues plague the property. U.S. Environmental Protection Agency records indicate the groundwater is contaminated with carcinogens. In November 2007, a state inspection found 16 violations, including failure to properly maintain the groundwater-monitoring system.

According to a 1999 EPA report, the contamination "poses a potential threat to drinking water sources and the environment, including the adjacent Tennessee River."

Wolverine's $10 million price tag conflicts with its estimates on the property's value.

In its 2008 annual report, issued four months ago, the company said the property's value benefited from the fact it was in an area that was not economically depressed, and from military expansion and the space industry.

"Issues with the Decatur facility include its size, age, and potential environmental issues depending on the use of the property," the report said. "Its location on the Tennessee River in water deep enough for mooring or docking commercial or large private vessels has appeal to both commercial and industrial users."

Wolverine estimated the net fair value of the property at $3.7 million, but noted most buyers would have to demolish and remove buildings on the site.

Even though the company continues to use part of the property, it said, "the entire property is listed as held for sale."

Wolverine ended production at the plant in December. It employs 85 at the plant in corporate office, research and development, accounting, human resources, information technology, scheduling, quality, sales and marketing. The TEPPCO facility would be on undeveloped land.

Officials at the company declined comment.

Parker said if he bought the property, he would not develop it immediately because of the depressed financial market.

"We would buy it and just find some sort of utility for what's there until economic times improve."

He said the $10 million price tag is unreasonable.

"If that's the deal, we're not interested. We're out."

Parker said he is watching the property.

"I'm hoping this TEPPCO deal will fall through and we'll get a shot at the land."

To see more of The Decatur Daily, or to subscribe to the newspaper, go to
http://www.decaturdaily.com Copyright (c) 2009, The Decatur Daily, Ala.
Distributed by McClatchy-Tribune Information Services. For reprints, email
tmsreprints@permissionsgroup.com, call 800-374-7985 or 847-635-6550, send a fax
to 847-635-6968, or write to The Permissions Group Inc., 1247 Milwaukee Ave.,
Suite 303, Glenview, IL 60025, USA.

More News:   Market Updates | Stock Alerts | All Trading News | Stock Index