Landing the right property growing difficult for new industries
Source: The Beaumont Enterprise, by Dan Wallach
November 18, 2007
Once upon a time, land on the continent that became North America was free as the wind.
Times have changed.
"It's all owned by somebody," said Roland Bieber, chief appraiser of the Jefferson County Appraisal District. "If it's not recorded at the courthouse, it's recorded by the state. Everything belongs to somebody."
And if it isn't owned by the state of Texas, it's in the hands of the federal government.
In Jefferson County, that means all 940 square miles of it are in individual, state or federal hands.
Bieber said a few years ago, in the Hamshire-Fannett area, an abstract - which was the method used originally to deed property - did not have enough room to fit the land in it. The state eventually enlarged the abstract, but that was more of a record-keeping problem than an actual bit of real estate that someone could have snapped up.
"We've gotten very sophisticated in the way we measure land," Bieber said.
People once used bandannas tied to a wagon wheel and measured land by counting how many times the bandanna came to the top of the wheel as it rolled along, he said.
Steel chains also were used to measure land, but the links could expand or contract, depending on time of day and temperature, he said.
In 1836, when the Republic of Texas was organized, all the land was in the public domain, said Sam O. Smith, a longtime real estate title searcher who specializes in finding the owners of properties.
That's necessary to sell the property when an interested buyer comes along, such as the Eastman Chemical Co., of Kingsport, Tenn., which selected Beaumont as the site where it intends to build a $1.6 billion chemical plant.
Eastman, however, needed rail and water access, which is a much scarcer commodity, said Rick Williams, a Nederland lawyer who worked with the Greater Beaumont Chamber of Commerce to attract Eastman to Southeast Texas.
Eastman was looking at a site north of the DuPont Beaumont site located between Texas 347 and the Neches River.
The company bought the former Terra Industries methanol plant in the DuPont Industrial Park and also began acquiring property adjacent to it.
David Gallaspy, managing director of project development for the company's gasification plant, said locating the appropriate site with the right characteristics for an industrial site is becoming more difficult.
Eastman's experience in Beaumont led it to select it for its development, he said.
"It was a key component," Gallaspy said. "We needed access to rail and water. It's getting harder and harder to find."
Williams said the immediate area around DuPont, including the former Terra site, was simple and straightforward.
"That was a pretty short search," Williams said. "There were four or five different companies (that owned most of the land) and some individual landholders as you moved out closer to the highway."
Trying to find land for sale - and encountering owners who don't want to sell - puts a kink in the plans of economic developers, Williams said.
And Eastman's needs aren't confined to its plant site. It also needs acreage for it to store byproduct of its petroleum coke gasification process. Eastman's plant aims to take petroleum coke, a byproduct of the crude refining process, and turn it into useful industrial gases, like ammonia, methanol and hydrogen.
However, there will be byproduct from that as well, which also is useful to other buyers. The company will need a place to store the byproduct until it can be taken away.
Williams called the byproduct "innocuous," and that it could be used in roadbeds, roofing material or cinder blocks.
The hunt for such land continues, he said.
Gallaspy said Eastman is comfortable it can acquire the land it needs.
"We believe we are comfortably secure," he said. "We feel confident there are a number of choices and adequate space."
Sheri Arnold, owner of Coldwell Banker Commercial, Arnold & Associates, serves some clients who are looking for property parcels for industrial purposes.
"When you drive up here from Houston, you'd think you could build a plant here with no problem. Well, there are so many factors if you're trying to put together several hundred acres - when you actually go out there and look at it," she said.
For example, does the land have pipelines crossing it on the surface or below? Is the land considered wetlands, and if so, where and how will you find other land to offset the loss of the wetlands in question? Is the land crossed by high-voltage electric transmission lines? Is it crossed by canals, or is the land what's called a "jurisdictional drainage ditch" that drains other properties?
"Pipelines are a huge factor," Arnold said. "I had no idea how huge it was. You can't build over a pipeline. It's a puzzle and I'm not sure all the pieces are there."
Williams acknowledges how tough it's been for his own client, Eastman, in this situation. Eastman executives, in earlier visits to Beaumont, also have acknowledged the difficulty but it's not new to them.
For Eastman, Williams said, the properties it needs aren't yet closed, but it has options to buy.
"I can't tell you how tough it is to come up with," Williams said, referring to specific needs such as water and rail access.
"We got a call a month or so ago for 50 acres with rail and water. It's incredible - with as much coastline as we've got - and all of the rail and water access is tied up," he said.
The eyes of economic developers are looking toward the east bank of the Neches River - the Orange County side - as the logical area for more industrial development.
"There's a lot of marsh, but there is developable property," he said. "We still have competition for water and rail sites within the state."
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