By Dennis Quick
Senior Staff Writer

Magnolia Development is on the verge of transforming North Charleston’s former Macalloy steel plant site from a Superfund site into a light-industrial haven.

On Aug, 3 the city’s Planning Commission approved Magnolia Development’s plan to divide the site into nine parcels that would be leased, and in some cases sold, to shipping container-storage companies, warehouses for port-related businesses and other light-industrial companies.

The parcels range from three acres to 69 acres. Additionally, the commission gave Magnolia the nod to build three new roads and a cul-de-sac on the 142-acre site. Road construction is expected to begin this fall.

The Macalloy site, which has been closed and vacant for seven years, is part of Magnolia’s plan to redevelop some 500 acres of peninsular Charleston’s “Neck,” an area of scattered communities and industrial wasteland.

Magnolia intends to transform the blighted Neck into a mixed-use community of new homes, offices, shops and parks, plus light-industrial businesses.

Magnolia’s plan is to reserve the Ashley River side and central portion of the massive development for housing, offices and shops, and the Cooper River side, where the Macalloy site is located, for light industry.

The Cooper River side of the Neck has always been primarily industrial and, therefore, more advantageous to light industry than the Ashley River side, Magnolia principal Robert Clement III says.

“That’s a better location for them because they will be closer to the proposed new port and because we can ensure that Magnolia is more residential in nature,” Clement says of the Neck-area companies considering relocating to the Macalloy site.

Magnolia, which purchased the Macalloy site for $12 million in February, has verbal agreements with about six Neck-area light industries to relocate their operations from the Ashley River to the Macalloy site. Also, a company from outside the Lowcountry is talking with Magnolia about purchasing 54 acres of the site.

Clement will not disclose the companies with whom Magnolia is negotiating or the price of the parcels, most of which will be purchased by companies relocating to the Macalloy site.

A revitalized Macalloy site would generate property tax revenues for the first time since 1998 and could create employment opportunities because of the possibility of a new company entering the region and occupying a sizeable piece of the property, Clement says.

“Redeveloping a formerly contaminated site and returning it to the tax rolls will have a major economic impact on the citizens of North Charleston, providing tax revenues and jobs,” Clement says.

Before it closed, Macalloy was North Charleston’s second-largest property tax contributor, following MeadWestvaco, Magnolia officials say.

The Macalloy plant used ferrochromium to produce steel for the U.S. Department of Defense during World War II. Located by Shipyard Creek and bordered by Spruill Avenue on the west and Pittsburgh Avenue on the south, the Macalloy site has had a history of pollution problems.

In April 1998, the U.S. Environmental Protection Agency and the state Department of Health and Environmental Control closed Shipyard Creek to shrimping and crabbing because of reported high levels of chromium from Macalloy found in the creek’s shrimp and crabs. A judge later revoked the ban.

In July 1998, DHEC and the EPA ordered a cleanup of the site. That same month, competition from cheaper foreign- produced ferrochromium caused the Macalloy plant to close.

In February 2000, the property was placed on the National Priorities List and became an $11 million Superfund project because the soil and underground water were contaminated with chromium. Superfund is the federal government’s program to clean up hazardous waste sites. In 2004, Macalloy agreed to pay $1.2 million in fines for violating environmental laws.

Macalloy began cleaning up the site in October 2004. Entact, a Texas-based environmental services contractor, is digging up the soil and treating it and the underground water with a liquid agent that lowers the chromium’s contaminants to a benign level. Additionally, slabs of foundations from demolished buildings and other leftover pieces of concrete are being crushed and used as onsite filling material.

“We’re treating the soil in 500-cubic-yard batches at a time and testing each batch onsite,” explains Craig Zeller, the EPA’s Macalloy project manager. He adds that the site cleanup has been “a very cooperative team process” involving Macalloy, the EPA and Entact.

“Today, most of the contamination has been eradicated, and we are ready to proceed with infrastructure improvements so that we can redevelop the property for clean, light-industrial use,” says Clement.

He estimates building construction on the site will begin in early 2006 and be completed that summer.

Dennis Quick is senior staff writer for the Business Journal. E-mail him at dquick@charlestonbusiness.com.

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