Efforts to sell the former Bayside Market property on Park Point have been hampered by the soil it stands on.
“The reason it didn’t sell had nothing to do with the price,” co-owner Melinda Gajewski said of the property that was for sale for nearly seven years. “There was some interest in it. But there were some environmental issues connected to the gas pumps we had.”
The source of the problem was an old underground fuel tank at the longtime neighborhood grocery, convenience store and gas station. The tank was near the building that housed the store on the first floor and an apartment on the second floor, according to Dave Holappa, the real estate agent for the property.
“A tank in the rear portion of the property had leaked and leached into the soils underneath the building and into the crawlspace under the building,” he said. “Some of the soil can’t be reached for cleanup because it’s underneath the building. So the building is coming down.”
That leaky tank was removed long ago, but the damage had been done. Newer tanks that were removed in late 2013, along with the gas pumps and fueling canopy, were not a problem.
The contamination, which has been monitored for years, doesn’t affect the surrounding residential properties, Holappa said,
The 4,000-square-foot building at 1901 Minnesota Ave. is expected to be razed in the next month or two. After that, cleanup of the site will get underway, with excavation and removal of the contaminated soil and new soil brought in.
“When you have environmental issues, there’s not a lender in the world that will lend,” Holappa explained. “It creates a significant added risk for the lenders, so they say they’re not interested in that. It reduces potential buyers to those who are willing to take the risk or are all-cash buyers.”
While the building on the 100-by-155-foot lot didn’t sell, Holappa said there is strong interest in the property if it were cleared of structures and cleaned up.
Park Point fixture
The property was listed for sale after Melinda and Richard Gajewski closed the business - Park Point’s only market - in late 2008 and retired to Clearwater, Fla.
Richard Gajewski had owned and operated the market for 37 years with the couple living in the upstairs apartment.
“In its heyday, that’s where you got your soda pop on the way to the Point and where you got gas,” Holappa said. “But you could also get custom sausages there that Dick made. And he had a pretty good inventory of groceries that serviced Park Point for many years.”
The property had been listed for sale with another agency for several years before Holappa Commercial Real Estate took over the listing. Holappa initially listed the property for $595,000, substantially lower than the original asking price.
“Dick and I were always hoping to sell to somebody willing to work through (the soil issues),” Holappa said.
The property was taken off the market when it was determined that the building needed to come down in order to remove the contaminated soil under it, he said.
The cost of the cleanup will be substantial, Holappa said. But the owner of the tank bears some responsibility and is taking the lead in the cleanup, he said. The state of Minnesota also has programs to help with the cost.
By the time the property was taken off the market last fall in anticipation of the environmental remediation work, the price had been reduced to $549,000.
According to St. Louis County records, the property’s assessed value is $472,800, but Holappa said assessed and market values can differ greatly.
Once the site is cleaned up, it will be re-listed for sale, they hope in the spring. The asking price hasn’t been determined yet but will be based on comparable properties, Holappa said.
“It’s one of the very few undeveloped commercial nodes on Park Point, so based on Economics 101, it should demand a very good price,” he said.
The owners are confident of a sale this time.
“We’re more than hopeful,” Melinda Gajewski said. “We’re pretty sure the property won’t last long on the market.”
Holappa said he already has a list of interested buyers but declined to say how they would use the site.