The Massachusetts Port Authority said yesterday it reached a preliminary agreement with a company that pledges to spend $50 million to rebuild the former Subaru Pier in South Boston, construct three huge warehouses, and eventually employ 600 workers in a new freight and cargo operation.
Massport said the company, Marine Terminal Development LLC, by early next year expects to begin two years of construction on the 30-acre site, located between Fish Pier and Black Falcon Cruise Terminal.
If the plans proceed as hoped, they would be significant because the site, where Subaru cars were stored, is largely unused and dilapidated right now. Massport said getting private investment for increased activity at Boston's underused seaport benefits the area's economy and the agency's finances.
"Someone is willing to come in and spend $50 million of their own money," said Deborah A. Hadden, deputy port director for properties and transportation. "They're going to be providing a range of services the port doesn't have right now."
Marine Terminal Development, a collaboration of three Boston-area companies and one New York firm, plans to build 470,000 square feet of warehouse space devoted to seafood processing and cold storage, shipment of freight including handling of containers, and importing and distribution of bulk cargo like cement, lumber, and paper.
Massport stumbled earlier this year when it tentatively selected one of eight bidders on the site. It chose a handler of scrap metal, which resulted in an outcry over possible environmental damage and caused port officials to reconsider.
"Part of our mission statement here is also to be a good citizen," Craig P. Coy, chief executive of Massport, said yesterday. "It was going to be hard to make that work in the close-order environment over there."
Hadden declined to say how much rent the company will pay in its 65-year leases on the property until they are signed, early next year. But she said the income to Massport would be roughly 25 percent less than would have been received from the other operator.
However, the metal-handling company planned only about 70 on-site jobs, considerably fewer than the 600 Marine Terminal envisions.
"I think it's damn fine you're getting some private money put into port facilities," said Arthur Lane, president of Peabody & Lane Corp., a shipping agent in New England ports.
Marine Terminal Development consists of Cargo Ventures LLC of New York, and Boston Freight Terminals, New England Development, and the Fallon Co., all of the Boston area. Jacob Citrin, president of Marine Terminal, is a principal with Cargo Ventures and was formerly with International Cargo Port, when the cargo company located at Black Falcon Terminal.
Vivien Li, executive director of the Boston Harbor Association, said redevelopment of Subaru Pier may even benefit waterfront visitors.
"It's a great opportunity to reinforce the working port and potentially to provide access for the public to see these maritime activities," she said. "The views are quite spectacular."
Subaru Pier is in South Boston's Marine Industrial Development Park and is owned by the Economic Development and Industrial Corporation of the City of Boston. It is leased to Massport through 2070 and is the largest of the port's undeveloped waterfront holdings.
Just to the west, toward downtown, are a new Legal Sea Foods headquarters and a multi-tenant seafood processing warehouse.
"This use fits very nicely with what's going on in that whole area, providing a link with the seafood industry and an international capability -- via highway, via air," said Coy. A freight railroad link stops about 900 feet from the property and could be extended for about $3 million, port officials said.
(c) 2005 The Boston Globe