City Council approves land purchase by Midwest and Bluegrass Rail for development of Willmar Rail Park

WILLMAR — Willmar Rail Park is one step closer to reality after the Willmar City Council on Monday approved the $1.16 million purchase agreement with Midwest and Bluegrass Rail for 145 acres of land in the Willmar Industrial Park .

"This is a culmination of a lot of work over the last 12 years to have a successful rail area that utilizes the Wye ," said Aaron Backman, executive director of the Kandiyohi County and City of Willmar Economic Development Commission . "People forget the efforts of people that went before us sometimes, and there was a lot of effort to get that $50 million project finished . … This fulfills part of what we were hoping to accomplish with that Wye."

The planned Willmar Rail Park will be owned and managed by MB Rail, a full-service company formed in 2019 to provide rail and logistics in the Midwest.

MB Rail will develop the park and then sell or lease areas of the park to businesses that need rail transportation, such as Nexyst 360 .

Nexyst 360 began showing interest in Willmar's Industrial Park in early 2022 , and was originally going to purchase acreage in the park for its development of a transloading facility for agricultural products.

Nexyst 360 then brought in MB Rail to develop the par k to accommodate Nexyst 360, as well as several other business entities.

The Willmar Rail Park will have a rail loop that comes off the Willmar Wye, with four spurs going into the park to accommodate different businesses. The development will take advantage of the decommissioned airport runway for staging purposes in loading and unloading rail cars.

Joining Backman at the City Council meeting to introduce themselves and tell the council a little bit more about what they do were MB Rail representatives Brian Miller, chief operations officer, and Brendan Keener, vice president of commercial development and government affairs.

Miller has been in the rail business for about 30 years, working with Norfolk Southern Railway for about 20 years, and then as a short-line operator for eight and a half years before branching out to purchase rail assets, he told the council.

He explained that MB Rail owns and operates short-line railroads in Kentucky, Ohio and Pennsylvania to provide first/last mile rail service to freight customers; offers rail-truck transloading services for freight shippers without direct rail spur access at its terminals in Kentucky, Ohio and Missouri; and provides nationwide trucking and drayage for more than 100 customers through a network of dedicated and open market carriers.

"We like the development side and the growth side," Miller said. "We, historically, the short lines we’ve taken over, they’ve been family-owned for 20 or 30 years — the gentleman's getting ready to retire, doesn't have any family to take over — we’ll go in and develop the business out and grow it. That's kind of our plan here, we’re going to develop it. We’ve had a ton of feedback from local industries — even industries outside of the Willmar area — and working on transloading for this park, so there's a lot of interest in this park."

Keener explained that MB Rail works as the intermediary for businesses that want to take advantage of rail transportation, but may not be able to navigate the processes required to do so or have the funds or time needed to acquire land and build out their own rail spur.

"The economics still speak for themselves when shipping high volumes of commodities over long distances. It certainly is cheaper, generally, to ship those products in or out by rail versus over the road," Keener said.

"We’re not necessarily the baseload industry that's going to directly have 300 people manufacture something, but we want to be facilitators of that industry and help those industries find ways either to locate directly into this park or, if they’re already set up in or near the community, to be able to utilize rail assets in the park to take advantage of rail through the process of transloading," he added. "This is going to be a blank slate, so we are very excited about that."