In what is good news for York City's largest redevelopment project, bids for the first phase of demolition in the Northwest Triangle have come in significantly under budget.

City economic director Matt Jackson said eight "very competitive" bids were unsealed Wednesday, and the lowest was less than $300,000 -- only a fraction of the $1 million the redevelopment authority had budgeted for demolition work.

The redevelopment authority will still have to pay for a second round of demolitions if it succeeds in acquiring the three-acre Ohio Blenders property, but Jackson said he now expects total demolition costs to come in below $400,000.

"We're very excited by this news," Jackson said. "It helps our budget and allows us to start the work this year."

He would not release the name of the bidding companies, he said, because city staff members have not yet reviewed the bids to make sure all requirements have been met.

Weeks of work: The demolition contractor will tear down the Weaver Auto Body shop, the B&C Fasteners building, and four row houses along Beaver Street, Jackson said.

Workers will also remove the collapsing wood-frame portion of the Western Maryland Freight Station, leaving only the rounded-front brick headhouse on George Street.

The exact start of demolition depends on the contractor, but Jackson said he hopes work can be finished this year. In any case, the site should be clear by the end of January, he said.

State grants and private funding will finance the bulk of the $50 million project, in which developers Kinsley Companies and Enterprise Homes Inc. plan to create commercial space and 85 to 125 new townhouses in a mixed-use development along the Codorus Creek. However, the city has put up a small percentage of the cost itself.

Jackson has requested that the city put an additional $250,000 toward Northwest Triangle environmental remediation in 2008, as well as $67,000 in other costs.

Redevelopment is already under way in the Northwest Triangle, where Kinsley is renovating the Smyser-Royer building. But most of the Triangle work waits on demolition, and the city is still in court over the Ohio Blenders property, which it hopes to seize by eminent domain.