Sale of Kimberly-Clark property called off

EVERETT — Contaminated and unstable soil has sunk plans to move a Seattle-based shipbuilder to Kimberly-Clark’s former mill site on the Everett waterfront.

Kimberly-Clark Corp. and Saltchuk could not agree to who was responsible for overseeing and paying for the site’s cleanup, representatives for the two companies said Wednesday.

“Despite the fact both sides worked diligently, they 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,” Saltchuk said in a statement.

The company had planned on buying the site for its subsidiary Foss Maritime Co., which operates a shipyard and maintains a fleet of tugs, barges and other specialty vessels in Seattle. The 66-acre mill property has been vacant since Kimberly-Clark closed the mill about two years ago.

When the companies announced in October that they had a deal, it seemed all that remained was to dot the I’s and cross the T’s.

Then Saltchuk’s inspection of the land raised concerns about the cost, risks and time needed for site development.

Kimberly-Clark agreed to give the company more time to do further site analysis. The two sides couldn’t resolve the issues in talks.

“It was Saltchuk’s position that it should be Kimberly-Clark’s responsibility to clean up and prepare the site for the new owner,” said Emily Reiter, a Saltchuk spokeswoman.

The land consists largely of fill dirt, and most of the buildings were on pilings. Most structures were demolished last year, but, as is common practice, pilings below ground level were left in place.

Kimberly-Clark is removing petroleum-contaminated soil from the area, which has been in heavy industrial use for decades, while waiting for the state Department of Ecology to approve a site cleanup plan.

The waterfront site, first developed more than a century ago, was primarily used for paper and pulp manufacturing from 1931 until the mill closed in 2012.

Some of Saltchuk’s concerns had to do with dredging contaminated soil from the East Waterway.

Deep water access was critical to the company’s plan to move Foss’ Seattle operation to the site. Foss has outgrown its 25 acres along Seattle’s freshwater Ship Canal, where as many as 250 workers are employed during busy times and as few as 75 during slow periods. The company has a smaller shipyard in Rainier, Ore., which would not move.

Any moving plans for Foss are on hold, Reiter said. “We’ll take a step back and evaluate.”

Foss needs a new site, but Saltchuk isn’t in a rush.

“We’ll continue looking for the right opportunity, but there’s no second site on a list,” she said.

The company is still interested in the Kimberly-Clark site, if the two sides can reach an agreement, Reiter said.

Neither side has disclosed the dollar amount of the October deal.

Kimberly-Clark will start marketing the site immediately, said Bob Brand, a spokesman for the Dallas-based company.

“We had a lot of interest before Saltchuk, and we expect there is still a lot of interest,” mostly for industrial uses, he said.

However, he said he isn’t aware of an alternate buyer.

Kidder-Matthews is Kimberly-Clark’s broker for the site.

Everett Mayor Ray Stephanson isn’t giving up on Foss moving north and bringing hundreds of skilled blue-collar jobs along.

“I am disappointed that Kimberly-Clark and Saltchuk have not yet been able to reach an agreement, but I hold both companies in the highest regard and am hopeful they can resume their discussions,” Stephanson said Wednesday in a statement to The Herald. “Preserving our working waterfront is important, and I believe a maritime use is a great fit for this unique site.”

Dan Catchpole: 425-339-3454; dcatchpole@heraldnet.com; Twitter: @dcatchpole.

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