PHILADELPHIA (KYW Newsradio) — Four years ago, a massive explosion and fire put the Philadelphia Energy Solutions (PES) refinery in South Philadelphia out of business. A Chicago firm is in the early stages of redeveloping the site as a logistics and life sciences hub.
Hilco Redevelopment Partners (HRP) bought the PES site in 2020 for $225 million, with plans to build a center it dubbed the Bellwether District.
Nearly all of the petroleum tanks and pipes are now gone from the 1,300-acre site, said Roberto Perez, HRP chief executive officer.
“About 98% of the refinery has been removed,” he said. “All the physical infrastructure that would refine hydrocarbons to make diesel or gasoline has been removed off the site.”
Perez said in the third or fourth quarter of this year, construction should begin on two warehouses — one more than 300,000 square feet, and the other about 700,000. He said the warehouses do not have tenants yet.
“We do believe that the fundamentals of Philadelphia are so strong — whether it be on the labor, the investments already made at the port, the airport, and really the overall infrastructure — that once we build the buildings, [tenants] will come,” he said.
Construction on the life sciences portion is expected to start next year.
Hilco has been responsible for cleaning up any environmental damage that occurred at the site since 2012. Perez said the company will continue the environmental cleanup as construction continues.
“Remediation has been happening here for some time and it will continue to happen here for the next decade. But it will be completed as we develop the site,” he said. “As we create new parcels and new buildings, those acres will be formally closed out through the regulatory agency process.”
Community groups near the site, between Grays Ferry and Girard Point, have demanded guarantees of jobs and a seat at the table. HRP has begun negotiating a community benefits agreement (CBA) with two dozen community groups and hopes to have an agreement in place by early next year.
“Whatever we do from a CBA perspective is with the end goal of job creation in an equitable and much more sustainable manner,” Perez said, adding that the complex would create 19,000 direct and 20,000 indirect jobs.
“Everybody’s excited about the ability for us to not only remediate one of the most challenging sites east of the Mississippi, but most importantly, making it an economic engine for the city of Philadelphia and, quite frankly, the region,” he added.
In 2022, the U.S. Chemical Safety Board concluded that a corroded pipe led to the June 21, 2019 explosion at the largest oil refinery on the East Coast. The blast released more than 5,000 pounds of hydrofluoric acid (HF) into the air. No injuries were reported.
In 2020, City Council passed a bill, introduced by Councilmember Kenyatta Johnson, banning the use of HF in refining operations in Philadelphia.