Incorrect estimates of the amount of scrap metal and fluctuation in steel price kills company.
The contractor demolishing the old Peru power plant on Water Street packed up and left town because it went broke trying to squeeze salvageable metal out of the structure.
The contractor paid the city $100 to take ownership of the property. This arrangement shielded the city from liability and unknown costs including asbestos removal, which cost contractors $400,000, Schweickert said. The contractor agreed to this because of the large amount of marketable steel in the building.
Last year the city deeded the property to A-Unified LLC of Cincinnati, Ohio. A-Unified removed some metal items and hired a company to remove asbestos, per state orders. Asbestos removal proceeded in fits and starts with weeks of inactivity. “A-Unified went broke after spending about $300,000-plus on asbestos remediation,” Schweickert said.
A-Unified assigned its contract to Global Construction, which finished asbestos removal and began demolishing the structure April 26. Demolition proceeded rapidly this summer, a promising sign after months of inactivity.
Global Construction spent another $100,000-plus to finish asbestos removal, cleared up some of A-Unified’s liens and also went broke, prompting it to leave, Schweickert said.
“They did not estimate correctly and with salvageable steel dropping from $400 to $300 they went broke also,” Harl said.
Originally, contractors estimated the building contained 2,000 tons of salvageable steel, fetching $400 a ton. The building gave up less than 1,000 tons, Schweickert said.
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