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Parties still talking about deal for Kimberly-Clark site

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By Dan Catchpole
Herald Writer
@dcatchpole
Published:
EVERETT — A deal to sell the former Kimberly-Clark mill site on the waterfront for use as the headquarters of Foss Maritime Co. fell through in April, but the two sides haven't given up on reaching agreement.
Kimberly-Clark and the would-be buyer, Foss parent Saltchuk, could not agree on how to split the cost of cleanup and site preparation. Kimberly-Clark put the property back on the market.
But the two sides are still talking, though not formally, according to sources familiar with the situation.
Neither company would say how serious the discussions are.
Saltchuk is still interested in the property, said Emily Reiter, a spokeswoman for the Seattle-based company.
Saltchuk chose the industrial site as a new home for subsidiary Foss, which operates a shipyard and maintains a fleet of tugs, barges and other specialty vessels in Seattle. The 66-acre property has been vacant since Kimberly-Clark closed its paper mill about two years ago.
“We're not actively looking at other sites,” but that could change in the future, Reiter said.
While Foss Maritime needs room to grow, there is no rush to move, Reiter said.
The two companies announced a tentative deal last October, but closer inspection of the site by Saltchuk led to concerns about the cost, risk and time needed to redevelop the property.
Saltchuk was most concerned with the seismic stability of the land, which consists mostly of loose fill. The most recent mill structures were built on pilings sunk deep into the fill. Most buildings were demolished last year and, as is common practice, pilings below ground level were left in place.
But the pilings are connected, and that could intensify shaking at the site during an earthquake, according to sources familiar with the negotiations.
Saltchuk wanted Kimberly-Clark to pay much of the bill to deal with the pilings, and Kimberly-Clark disagreed, according to the sources.
The two sides also could not agree on how to split the cost of an ongoing environmental cleanup.
Kimberly-Clark has been removing petroleum-contaminated soil from the parcel, which was in heavy industrial use for decades, while waiting for the state Department of Ecology to approve a cleanup plan.
Saltchuk declined to discuss the details of its concerns with the land.
In April, the company said in a statement that the deal fell through because the two sides “were unable to agree on the allocation of risks and responsibilities related to certain soil stability, seismic and environmental conditions as they relate to Saltchuk's proposed use of the property as a shipyard and terminal.”
The waterfront site was first developed more than a century ago and was primarily used for paper and pulp manufacturing from 1931 until the mill closed in 2012.
Despite Saltchuk's concerns, Kimberly-Clark is confident it can sell the land, and several potential buyers have expressed interest in the site since it was put back on the market, said Bob Brand, a spokesman for the Dallas-based company.
Lanie McMullin, Everett's economic development director, confirmed that potential buyers have contacted the city for information related to the site. She would not identify the potential buyers but did say they all are interested in industrial uses consistent with existing zoning.
“A maritime use on that property is the best application,” Everett Mayor Ray Stephanson said.
With no sale in the offing, the city will hold Kimberly-Clark to a June 15 deadline to put down top soil and grass seed on the site, which will reduce dust in the air, he said.
Everett had originally imposed an April 15 deadline because of ongoing negotiations at the time between Kimberly-Clark and Saltchuk, he said.
“If it's on the market, our expectation is that it's cleaned up for unrestricted use” and not just industrial, Stephanson said.
Dan Catchpole: 425-339-3454; dcatchpole@heraldnet.com; Twitter: @dcatchpole.

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