The city of Vallejo plans to literally clear the way this year for redevelopment of 157 acres at the north end of its fast-growing Mare Island commercial area, awarding the first contract to demolish buildings from its shipyard past.

The City Council on June 12 awarded a $924,505 demolition and toxics abatement contract to Mountain View-based Ferma Corporation, officials announced. That work would be done this summer, and a second phase is planned to move forward this fall.

The goal is to replace vacant buildings with sites ready for the large mixed-use development accepted by the council as the lead contender in mid-May.

“We are excited to begin clearing the path by removing vacant buildings on the property,” Mayor Bob Sampayan said in the announcement.

Led by local vintners, the Nimitz Group wants to build 1.2 million square feet of commercial space for production of films, wine and other beverage and for offices and shops, according to its proposal. The bulk of it would be for SHM Partners Film Mare Island, which wants to occupy 600,000 square feet of soundstages and other film production facilities on 56 acres.

The plan is anticipated to create more than 1,500 jobs initially.

Negotiations on that deal are set to be finished in coming months, the city said. Once the development agreement is completed, Nimitz Group could start work.

In the meantime, Ferma is tasked with removal of six buildings. That includes five structures on the northwest corner of G Street and Walnut Avenue, known as Buildings 995, 997, 999, 1013 and 1015. A $252,000 change order will add Building 897 to the scope of work.

The work includes removal, transport and legal disposal of any lead and asbestos material, demolition of existing structures, foundations, or abandoned utilities, removing all rubbish and debris, and finally grading the finished site.

The demolition is funded by an approved U.S. Department of Housing & Urban Development Section 108 loan of $4.7 million. Such loans are primarily used on economic-development projects that create jobs, the city said.

The Navy decommissioned the Mare Island shipyard in 1996 and soon thereafter turned it over to Vallejo. Through work by Lennar Mare Island and others on the southern section, the island currently has about 110 businesses employing 2,500 full time and leasing 3.6 million square feet of space, much of it in historic buildings, according to the city.

Contact Jeff Quackenbush at jquackenbush@busjrnl.com or 707-521-4256.