A joint venture between Alterra IOS and Eco Materials bought a 5-acre site in Southwest Philadelphia for $5.75 million with plans to build a soil recycling facility.
Including the purchase price for the property at 6110 Passyunk Ave., the project is expected to cost $40 million. Construction began this month, and the facility is planned to be in operation by spring 2025.
The clean wash facility would accept non-hazardous contaminated soil, likely from construction companies that would otherwise dump it in a landfill. The soil would then go through a cleaning process, leaving up to 85% suitable for sale and reuse. The facility is designed to recycle up to 250 tons per hour.
Alterra IOS is the industrial outdoor storage arm of Alterra Property Group, and Eco Materials was founded last year to provide an environmentally friendly alternative for the disposal of waste from construction sites. Both companies are based in Philadelphia.
Alterra Property Group Managing Partner Leo Addimando and Eco Materials General Manager Andrew Paluszkiewicz said there are fewer than 10 facilities in the United States dedicated to this aggregate recycling process. Soil that is dug up during construction projects is required to be disposed of safely, and recycling the soil instead of dumping it benefits the environment, they said.
“The fact that we’re just taking all of our excavated dirt and we’re putting it in landfills next to plastic bottles and your trash from your garbage bin, it’s mind-blowing to me,” Addimando said. “Eighty percent of this or more could be recycled, put back into the construction ecosystem.”
Alterra Managing Partner Leo Addimando sees opportunity in a new soil recycling facility in Southwest Philadelphia.
Money for the project came from Alterra IOS’ recent $900 million fundraising round for industrial outdoor storage, Addimando said. A portion of the fund can be used for industrial projects other than outdoor storage.
While Alterra Property Group has established itself locally for converting offices to residential, its IOS division has expanded rapidly, acquiring properties across the country.
Paluszkiewicz is also president of American Sitework and has spent 20 years in the site work business. He began exploring aggregate recycling about two and a half years ago. Given his background, he immediately thought the process made sense.
“I never really took time to look at soil before this and realize the sand content and the stone content,” Paluszkiewicz said. “I was always just loading it and getting rid of it. But when you actually start to break it down, you realize there’s valuable aggregate within that bad dirt.”
Paluszkiewicz identified a land site and signed a lease with Passyunk Avenue Realty Enterprises, which owned the property before the joint venture bought it. He also secured permits to operate the facility. It was a risky process since Paluszkiewicz still needed a partner to help finance the project.
As soon as he was introduced to Addimando, the two shared the same vision.
While this type of recycling facility is rare in the United States, Addimando said there are hundreds in Europe. He and Paluszkiewicz have toured facilities in England and Northern Ireland.
“The United States is lagging what Europe’s been doing,” Paluszkiewicz said. “But as [environmental] regulations have gone up, it’s driven the need for this kind of equipment. I always say to my partners, someone’s going to build one of these. It might as well be us.”
The Passyunk Avenue property is near HRP Group’s Bellwether District, a 17.5 million-square-foot industrial and life sciences project at the former site of the Philadelphia Energy Solutions refinery. It’s also near Falcon Concrete, which Addimando said is one of the largest concrete providers in Philadelphia.
Between those two operations and knowing how much dirt moves around Philadelphia regularly, Addimando and Paluszkiewicz are optimistic about the recycling facility.
“This is the first investment that I’ve seen that is a very sound and profitable business, and also is incredibly environmentally conscious and with no compromise of one to get the other,” Addimando said. “That, to me, is very attractive. It’s a very unique opportunity.”
By Paul Schwedelson – Reporter, Philadelphia Business Journal
