The city’s failed Olympics bid in 2015 highlighted the development potential for Widett Circle, an industrial area between the South End and South Boston. Now, the wholesalers there are considering whether to tap that potential by putting their 19 acres on the market and leaving the area.

Food wholesalers with an ambitious vision for what could be Boston’s next hot neighborhood may be on a collision course with state transportation officials, who are eyeing their land as a crucial parking spot for trains near South Station.

The idea of redeveloping the circle has been hailed by Boston Mayor Martin J. Walsh, prompting him to put it on the short list of places he’d like to see transformed into a vibrant new neighborhood.


But in its plan to expand nearby South Station, the state Department of Transportation recently singled out the Widett land as a “critical” layover area for commuter trains. MassDOT needs a place to park the trains during off-peak times, when fewer of them are in use. It currently has four layover sites that serve South Station, including one adjacent to Widett Circle, but will need more to accommodate the additional trains that are anticipated after the station is expanded.

Transportation officials identified three potential layover sites: Widett Circle, an expanded facility in the Readville section of Hyde Park, and the Harvard University-owned Beacon Park Yard in Allston.

All three locations are considered “critical” to the project, according to a Department of Transportation report filed with the Federal Railroad Administration last month.

Massachusetts Bay Transportation Authority spokesman Joe Pesaturo said Widett is a good location for midday layovers because of its closeness to South Station, its size, and its proximity to existing railroad infrastructure. He said the proximity to the station is particularly important — Widett is about a mile away — to reduce the distance traveled by empty trains that await their next rush-hour trips.


But if state officials want to control Widett, they may have to get past the mayor first.

A concept drawing of a train yard the Massachusetts Department of Transportation is considering for Widett Circle. Boston Mayor Martin Walsh wants to see the area, now home to food wholesalers, redeveloped into a new neighborhood. Mass. Dept. of Transportation

“I am not excited about putting a train layover yard there,” Walsh wrote in an e-mail. “There is certainly a lot better use for that land.”

He also outlined plans to turn Widett into a mixed-use neighborhood in his new Imagine Boston 2030 plan.

Michael Vaughan, a representative of the New Boston Food Market wholesalers, who package and truck food in and out of Widett Circle, said he wasn’t surprised to see his clients’ property listed as a potential layover spot. State transportation officials have eyed the property for years, long before it landed in the spotlight as a potential home for an Olympic stadium during the failed local bid for the 2024 Summer Games.

“I respect the fact that they need to explore all options [but] it’s getting old, the fact that they keep talking about this stuff,” Vaughan said. “It will be World War III for them to think they could take that land so they could park trains on it during the middle of the day. It would be a colossal missed opportunity.”

Together, Vaughan’s clients employ about 900 people at Widett and generate about $1 billion a year in revenue. The wholesalers haven’t yet decided whether to relocate. But Vaughan said that staying put, or redeveloping the site for a mixed-use development — possibly totaling more than 6 million square feet — are both better options than creating a train layover site.


MassDOT’s continued focus on Widett comes as the wholesalers take their first formal steps toward finding another home, ideally in the city’s marine industrial park in South Boston. Developer John Hynes recently expressed interest in a parcel on behalf of some of the Widett wholesalers.

Finding the right place to put trains isn’t the only hurdle facing the South Station project, which involves adding seven tracks to the current 13.

The state also needs to acquire the adjacent Postal Service property overlooking Fort Point Channel, but until now, the Postal Service has proved to be a reluctant seller.

State officials must also figure out how to pay for the $1.6 billion project.

(The cost approaches $2 billion if acquiring the Postal Service site is included.)

The potential conflict over Widett Circle has also emboldened proponents of the North South Rail Link, a possible alternative to the South Station expansion that would connect that station to North Station and to points beyond. Rail Link supporters say the extra flexibility would reduce the need for layover space near South Station.

There is, however, a way for trains and development to coexist on the Widett site: with a giant deck.

Such a structure could cover a rail yard while acting as a foundation for a cluster of buildings. But this concept, floated during the Olympics discussions, would be expensive, possibly costing more than $1 billion.


David Begelfer, chief executive of the real estate trade group NAIOP Massachusetts, said that with such a high price tag, government would probably need to finance the deck — and then sell off spaces above it to developers.

“No one developer would take on [a] project with infrastructure costs as great as that,” said Begelfer, whose group represents major players in commercial real estate. “Someone would have to come along there and do the deck first before you could really create the demand to get the developers to come in.”

For now, though, according to Begelfer, the priority for Widett in Governor Charlie Baker’s administration is transportation, not development. That means it’s more likely that a rail yard would be built first, and a deck would come later, if it comes at all, he said.

Meanwhile, the wholesalers remain hopeful that their land could be home to “the next great neighborhood in the city of Boston,” as Vaughan puts it, with a project that could help knit together the South End and South Boston.

“We’re on the verge of controlling our own destiny,” Vaughan said. “It’s frustrating that the [MassDOT plan] keeps surfacing. It’s like a ghost that we constantly have to deal with.”

Jon Chesto can be reached at jon.chesto@globe.com. Follow him on Twitter @jonchesto.