Warehouse construction starts soon at demolished South Philly refinery

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The South Philly site of what was once the largest and oldest oil refinery complex on the East Coast is now 1,300 acres of mostly dirt, scrubby vegetation, and lingering equipment used in the ongoing cleanup of the site.

In the coming months, more than 1 million square feet of warehousing space is expected to rise on the former PES refinery site along the Schuylkill River. By the end of 2024, the first building at The Bellwether District could be standing, officials said.

“This is much more than just a development project for us at Hilco,” said John Chen, president and chief operating officer of Hilco Global, during a ceremonial groundbreaking at the site on Monday. “This is a generational opportunity to affect meaningful and significant change and to uplift a community.”

Long operated by gasoline giant Sunoco and employer for over 1,000 workers — hundreds of whom were unionized with the United Steelworkers — the refinery was sold to Philadelphia Energy Solutions, or PES, in 2012.

The refinery shut down in 2019, after a massive fire and explosion.

Chicago-based Hilco Redevelopment Partners bought the site out of bankruptcy for $225 million the next year. The company has been demolishing the refinery’s tangle of pipes, tanks, and buildings ahead of schedule — and Monday, officially kicked off vertical construction on the southern portion of the site.

Hilco Development Partners plan to develop a 750-acre industrial and logistics complex on the southern part of the site and a 250-acre “Innovation Campus” on the northern portion. The company has mentioned likely uses including cold storage, last-mile delivery facilities, regional logistics, light manufacturing, and research and development, focused, for example, on pharmaceuticals.

“We’re building a … state-of-the-art industrial facility that will be LEED certified, able to handle the modern economy,” CEO Roberto Perez told WHYY News Monday.

The first building, part of the industrial campus, could be complete by the end of 2024, company representatives said during a public meeting last month. Site preparations for the Innovation Campus are set to start early next year, with vertical construction beginning in early 2025.

“Y’all have moved quick,” Pennsylvania Gov. Josh Shapiro said during the event.

The Bellwether District website describes the first two buildings planned to be built as warehouse facilities, together totalling more than 1 million square feet, with over 250 dock doors, more than 650 car parking spaces, and nearly 400 tractor trailer storage stalls.

The refinery was once the city’s biggest polluter — accounting for 16% of the city’s overall carbon emissions. It’s not yet clear what the carbon footprint of the new development will be. The first two buildings will be LEED certified with roofs built in anticipation for future solar panels, according to descriptions on the website, but will be heated with natural gas.

The warehousing portion of the site is expected to bring truck traffic. Hilco Redevelopment Partners is doing its traffic impact studies in phases as the development progresses, and has so far proposed expanding a nearby intersection.

Remediation of the site, which has been used for industry since the Civil War era, will continue throughout the development process “and for the foreseeable future,” vice president of development Kurt Carter said during last month’s public meeting.

Hilco Development Partners estimates that the entire redevelopment project will create 19,000 permanent jobs and close to 28,000 construction jobs over 10 to 15 years. The company has committed to invest $850,000 in workforce development.

“To us at the Philadelphia Building Trades, projects always mean people,” said Ryan Boyer, business manager with the Laborers’ District Council of Philadelphia, at Monday’s event. “This is going to be a great project.”

Nearby residents and activists with the group Philly Thrive initially cheered Hilco Redevelopment Partners’ purchase of the land, because it meant permanent closure of the refinery. Since then, the group has scrutinized the company’s planning process, calling for more community involvement. 

Activists have also pushed for the site to be a fossil-fuel-free development, for Hilco Redevelopment Partners to permanently decommission the oil tank farm across the river from the main site, for guarantees around employment and environmental health, and for protections against gentrification and displacement of longtime residents nearby.

Hilco Redevelopment Partners began negotiating a community benefits agreement with surrounding community groups and stakeholders in May, and hopes to complete the agreement in early to mid 2024.

WHYY News reporter Kristen Mosbrucker-Garza contributed to this story.