During much of August, dozens of Alter Metal Recycling trucks dumped piles of scrap metal onto the concrete pavement at Des Moines Industrial. 

The piles of mostly rust-colored scrap from vehicles, appliances and other large items left a dusty residue on Des Moines Industrial’s bright new white pavement, but the transloading facility’s co-founders, Paul Cownie and Gabe Claypool, didn’t mind  “This is where we’ve been working so hard to get to,” said Cownie, 45, Des Moines Industrial’s CEO. “It’s the fun part – seeing all of the activity going on.”

During the third week of August, dozens of rail cars passed through Des Moines Industrial, located at 357 S.E. 15th St. About 40 inbound rail cars filled with road salt – headed to the city of Des Moines and other municipalities – were emptied. Four empty rail cars were loaded with organic corn; two others were loaded with scrap metal; and lumber to make pallets was unloaded from two cars.

Activity will increase even more in the coming weeks, Cownie and Claypool said.

The Des Moines Area Metropolitan Planning Organization began planning for a transloading project more than a decade ago. For a variety of reasons, the project failed to move forward. In spring 2019, Cownie and Claypool became involved and began making plans for Des Moines Industrial to become operational by late 2020. 

After reviewing the original plans for the facility and its new rail tracks, they determined the proposed site layout was unworkable and started over from scratch. Getting all of the necessary federal, state and city approvals slowed development. So did the pandemic.

Construction of the warehouse, which is the length of over two football fields, began in spring 2021 and was finished early this year. The installation of more than 15,500 linear feet of new rail line was completed in the spring.

Cownie and Claypool, both with backgrounds in rail logistics, had hoped the facility would be buzzing with activity by early summer. But delays in getting equipment needed to move products slowed Des Moines Industrial’s operational start.

“We would have liked to have been busier earlier, but that momentum is about to shift,” said Claypool, 46, Des Moines Industrial’s president and chief operating officer.  A six-year lease

Earlier this year, representatives from Ziegler Cat approached Cownie and Claypool about leasing space in Des Moines Industrial’s 115,000-square-foot warehouse. The company, which is headquartered in Bloomington, Minn., has 22 locations in Minnesota and Iowa, including in Altoona. It sells, services and rents Caterpillar Inc. construction and mining equipment, trucks, generators and industrial engines. 

Ziegler Cat had been trucking its products from rail lines in Chicago and various international ports. Having a warehouse adjacent to spurs of three national rail carriers and a regional carrier was attractive to the company, Cownie and Claypool said.

In June, Ziegler Cat officials signed a six-year deal with Des Moines Industrial to lease all but about 4,000 square feet of the warehouse. The company will store its engines, generators and other equipment in the warehouse. Cownie and Claypool and Ziegler Cat officials are exploring opportunities to use rail-based logistics for receiving Caterpillar materials that originate overseas and shipping finished products.

Ziegler Cat plans on installing offices, meeting space and a break room for the approximately two dozen people who will work at the facility.

“I think Ziegler signing [the lease] was a big catalyst for people,” Claypool said. “They thought, ‘This is real. Ziegler is there. We’re comfortable. We’re coming.’”

To date, Des Moines Industrial has signed long-term leases with Ziegler Cat, Alter Metal Recycling, S&G Commodities and Skyline Salt Line Solutions. Other short-term contracts are in place and other deals are in the works, Cownie and Claypool said.

Having access to rail lines that serve different parts of the country is advantageous to companies shipping materials and products to customers throughout the nation and world, Claypool said.

Companies like Ziegler Cat and Alter Metal Recycling had used trucks to move their products to Chicago. The products were put on rail cars and then transported to either coast to be put on cargo ships or to customers in other parts of the United States.

“Now, instead of running trucks back and forth from Chicago, they are bringing their products here … where they are put on rail cars and transported,” Claypool said.  Rail’s environmental sustainability

Before launching Des Moines Industrial, Cownie said he didn’t fully appreciate the environmental sustainability aspects of rail transportation.

Four to five truckloads of materials or products can be transported on one rail car, reducing the amount of greenhouse gasses emitted into the atmosphere, Cownie said. 

“That’s been resonating with a lot of our potential and current customers,” he said. “People are looking at the efficiency of rail in a much different way.”

Des Moines Industrial was developed as a speculative project. Cownie and Claypool didn’t know what businesses would be customers of the transloading facility. Without a clear picture of their customer base, the business partners didn’t know what equipment to acquire or how much product would be stored on the nearly seven acres of concrete surrounding the warehouse.

“Now we have a much clearer picture of what the future looks like,” Cownie said.

Des Moines Industrial has acquired a conveyor system to move products like grain and salt to and from rail cars. It acquired fuel storage equipment, two end loaders, a telehandler or reach forklift, and a machine called a Trackmobile that pushes rail cars along rail spurs. Other equipment will be purchased as needed, Cownie and Claypool said.

“Our expectation all along was for Des Moines Industrial to be a jack-of-all-trades transloading facility,” Cownie said. “And it is 100% – in our opinion – on the path towards that.”

PHOTO ABOVE: Gabe Claypool, president and chief operating officer of Des Moines Industrial, and Paul Cownie, CEO. The end loader is one of several pieces of equipment purchased by Des Moines Industrial for the transloading facility. Photo by John Retzlaff

About Des Moines Industrial’s partners

Paul Cownie CEO and director

BACKGROUND: Cownie is a developer, manager and investor in several mixed-use, historical and agricultural projects in Central Iowa. He previously was chairman and CEO of Southern Plains Resources, an oil and gas exploration and production company, and an independent director of Dakota Plains Holding Corp., a publicly traded energy rail logistics company. Between 2016 and 2018, he was an independent director of Progressive Rail, a North American short line railroad and logistics company.  Gabe Claypool President, chief operating officer and director

BACKGROUND: Claypool was previously president and chief operating officer of Dakota Plains Holding Corp., where he managed several capital projects, including construction of the company’s crude-by-rail, sand and crude oil pipeline infrastructure at the company’s New Town, N.D., terminal at the Bakken oil fields. He also co-founded Cedar Midstream, which sold an Oklahoma crude oil storage facility that is currently in development. Before Dakota Plains, Claypool held business development and management roles with AT&T and General Electric.