August 5, 2008

Company Gets More Room for Burgeoning Wind Turbine Shipments

By Peter Passi, Duluth News-Tribune, Minn.

Aug. 5--Lake Superior Warehousing Co. Inc. should be better equipped to handle growing shipments of wind power equipment, thanks to a deal struck with the Duluth Economic Development Authority on Monday.

DEDA approved a plan for the company to lease about 12 acres of land across from the Lafarge terminal and southwest of Bayfront Festival Park, providing it with additional storage space needed to accommodate the burgeoning flow of wind turbines and towers through the port. Under the terms of the agreement, Lake Superior Warehousing will pay $3,500 per month for the property, acquiring the rights to use it through November 2009.

Under normal circumstances, Lake Superior Warehousing would have been stretched to handle the amount of wind energy equipment it was scheduled to receive this year. But the company also has experienced a backlog of cargo because of widespread flooding in other parts of the Midwest, which has delayed wind farm development this year, according to General Manager Jonathan Lamb.

Lamb stressed the importance of accommodating clients' needs, saying: "We want to continue to serve this industry and keep bringing business back to Duluth."

Lake Superior Warehousing plans to store equipment on land used for special event parking in the past.

To handle that parking, cars could be diverted to another nearby waterfront lot owned by DEDA, but improvements will need to be made to that property. Tom Cotruvo, DEDA's executive director, estimates the cost of those improvements -- including a chain-link fence to keep motorists from accidentally falling into an abandoned slip -- could easily approach $100,000.

Cotruvo suggested that Lake Superior Warehousing be asked to pay a monthly lease of $4,300 for the property to help defray those costs. He said that sum would be consistent with the rates the company pays to lease land from the Duluth Seaway Port Authority. However, Cotruvo said Lake Superior Warehousing had taken the position that it will pay no more than $3,500 per month for the property.

DEDA President Jim Stauber said he respected Cotruvo's concerns but would support the proposed $3,500 monthly lease rate nonetheless.

"This is a huge industry, and it's growing by leaps and bounds. I want to keep this stuff coming through our port," Stauber said.

The lease agreement passed with five DEDA commissioners voting in support of it. Garry Krause cast the sole dissenting vote, after citing aesthetic concerns about storing equipment on the site. Commissioner Todd Fedora abstained from the vote, citing a prior business relationship with Lake Superior Warehousing.

PETER PASSI covers business and development. He can be reached weekdays at (218) 279-5526 or by e-mail at [email protected]


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