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GM site continues to attract redevelopment interest

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MASSENA - For nearly a year, an empty slab has existed where hundreds General Motors Powertrain employees used to work.

There’s little physical sign of redevelopment there, other than environmental remediation crews hauling away contaminated concrete and soils to prepare the parcel for its future. But behind the scenes, discussions with prospective buyers continue to gain momentum, according to officials from the Revitalizing Auto Communities Environmental Response Trust, the site owner.

“If I wasn’t talking to anybody, I would be very nervous,” RACER Redevelopment Manager Bruce Rasher said. “That would mean either a) I’m not reaching the right people or b) There’s no market. Neither one of those is the case for Massena.”

RACER continues to engage in discussions with “a few” potential buyers who have expressed interest in the site. Mr. Rasher said there are 10 active “leads” for the Massena property.

Leads either mean a potential buyer has approached RACER with an interest in the site or Mr. Rasher is actively courting a developer because its needs and Massena’s assets are a good match. Four of those leads have emerged since January, while RACER is still in discussions with another six from last year.

If those discussions become serious, RACER enters into a confidentiality agreement with the prospective buyer. Mr. Rasher declined to provide how many confidentiality agreements RACER has entered since last spring out of concerns it would reveal too much about prospective buyers.

RACER took over the Massena property and over 100 other industrial sites in March 2011, Mr. Rasher said. Since then, it has sold off 19 properties in Michigan, Ohio, Wisconsin and Indiana. Approximately half of those sales were already in the works before RACER came into being.

The Massena site is among the majority of remaining properties yet to be sold. The site’s amenities - its rail access, low-cost hydropower capability and proximity to Canadian business looking for an American presence - continue to be selling points, Mr. Rasher said..

But a couple of geographic and economic obstacles also exist, he said. The 2008 economic downturn created an excess of shuttered factories and warehouses nationwide. Massena’s plant was demolished last year after officials said it was too contaminated to remain standing.

Existing space is generally a more attractive option for companies looking to open or expand than new construction, he said.

“There’s still a considerable amount of surplus industrial space available,” he said. “Our vacant industrial land is competing with existing space that’s really cheap right now.”

In addition, there is renewed interest in reusing vacant properties in the Ohio River region for automotive manufacturing. The Massena site is too far away from that region to be generating the same interest, he said.

Still, Mr. Rasher said there are reasons for optimism. RACER generated 160 leads nationwide in the last nine months of 2011. It has generated 180 additional leads during the first six months of 2012.

“It’s been sustained since the beginning of the year. It’s like someone flicked a switch on Jan. 2nd,” he said. “It’s clear we’re seeing the signs of upstream activity.”

He declined to speculate on how soon any portion of the Massena site could be sold off for redevelopment. RACER continues to actively market the Massena site to Canadian aerospace, defense and technology industries.

“The trust has been actively marketing the Massena site consistent with the community’s desire to attract new users there,” Mr. Rasher said. “We’re making progress in terms of exposing the Massena site to the market. I know we’re raising the level of awareness.”

Environmental Protection Agency officials previously estimated the majority of cleanup at the Superfund site would be complete by 2016 and said portions of the parcel could be sold off before then. Mr Rasher said the cleanup could be related to the pace of redevelopment at the Massena site.

“Whether the market is hanging back until we complete the environmental activities, that could be the case,” Mr. Rasher said. “It’s quite possible some of the developers interested in Massena are doing that very thing.”

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