Plans in locomotion

If the Philadelphia Industrial Development Corp. and the Delaware River Port Authority get their way, a phoenix will rise yet from the ashes of the old Navy Yard.

That phoenix was one step closer to taking flight with a press conference and groundbreaking Monday for the new Norfolk Southern Rail Yard at the eastern end of the expansive Navy Yard, now known as the Philadelphia Naval Business Center.

Officials from the PIDC, DRPA and Norfolk Southern delivered the big news while a bulldozer idled in the background of Mustin Field Naval Air Station, the site on which the railyard is being built.

The $16-million intermodal rail facility, capable of handling 60,000 lifts annually, will occupy about 50 acres at the former air station. It will aid in the movement of containerized domestic and international cargo from ships calling on the Ports of Philadelphia and Camden, as well as railroad cars and trucks entering the region.

With the addition of Norfolk Southern, Philadelphia will be the only major city on the East Coast with three Class-1 railroads: CSX, CP Rail and Norfolk, noted DRPA chairperson Manny Stamatakis. Class-1 railroads allow the maximum height and width for trains passing through.

Citing the importance of transportation to Philadelphia and the surrounding region, Stamatakis said more than 70,000 jobs in the area depend on cargo coming into this region.

"If we can get the cargo to come into our port, then we can get the cargo out to the channels," he said. "This [Norfolk facility] is another instrument in connecting the port to international terminals."

Once up and running in 2004, the Norfolk Rail Yard should generate 500 to 1,000 jobs, Stamatakis said.

Norfolk Southern Corp. is one of the country’s leading transportation companies. Its Norfolk Southern Railway Co. subsidiary operates approximately 21,500 route miles in 22 states, Washington, D.C., and Ontario. It is the nation’s largest rail carrier of automotive parts and finished vehicles.

The DRPA acquired the local property from the PIDC, which is managing the city’s redevelopment of the former Philadelphia Navy Yard into a commercial and industrial business park. Stamatakis said the DRPA loaned Norfolk Southern funds for construction of the facility. After the railyard is complete, Norfolk Southern will repay the loan over a 20-year period.

Craig Lewis, vice president of corporate affairs for the Virginia-based rail company, admitted Monday he had been "fearful" the deal would never come to fruition because of the many challenges facing his company, including the ailing economy.

But now that the project is on solid ground, he is more optimistic.

"The Navy Yard terminal improves the competitive balance between freight railroads servicing the Philadelphia region and strengthens Norfolk Southern’s position as the premier intermodal rail carrier in the Eastern United States," said Lewis.

The official called the deal another piece of the puzzle in fully utilizing the Naval Business Center.

PIDC president Peter Longstreth said the Norfolk Southern Railyard will usher in further revitalization at the former Navy Yard.

"This is just one of many projects. It’s a very exciting future," he said.

The PIDC has selected Liberty Property Trust to develop a 60-acre parcel of ground near the main entrance to the Navy Yard, said PIDC senior vice president John S. Grady Jr.

Preliminary plans call for construction of a proposed 1.1-million square feet of office space over a 10-15 year period, said Grady.

Since the PIDC acquired the property from the U.S. Navy almost two-and-a-half years ago, the focus has been on industrial development and the renovation of key historic buildings on the site, noted Grady.

"What this project will let us do is expand much more broadly into office development to complement the existing industrial development that we’ve been pursuing," he said.

About 6,000 people currently work in the Navy Yard, half of whom are Navy personnel, Grady said. The other half are employees of the nearly 35 companies housed in the complex.

To augment future development, Grady said the PIDC has been investing in utilities and the road systems of the expansive Navy Yard.

Two historic buildings on South Broad Street are currently in the process of being renovated for office use. One 30,000-square-foot structure will be available for occupancy later this year, while a 50,000-square-foot property will be ready in 2003.

Additionally, Grady said some older buildings in the yard are being demolished to make way for future development.

"It’s all part of an effort to begin to attract more of an office base to complement the industrial base already there," said Grady.