Jim Ash, PE, LSP, Vice President, Patrick King, PE, Environmental Division Manager, GEI Consultants, Inc. (Dec/Jan 07)
According to the U.S. Environmental Protection Agency (EPA), there are 450,000 underused, contaminated properties in the United States. As a result of our industrial history, many of these "brownfields" are in prime locations, close to urban centers and waterways. Redevelopment of these sites frequently involves a change in use because the new "highest and best use" is often very different than when the site was originally developed. These changes in use, and business decisions related to corporate image, can alter the environmental cleanup goals and require careful consideration during the planning process. While focused on cleanup and redevelopment of historically contaminated property, the concepts presented here can also be readily applied to new releases of contamination.
Location, Location, Location
Not all contaminated sites are the same. Some will be particularly well-suited for redevelopment because the type and location of the contamination makes them more manageable.
Including a knowledgeable environmental consultant in the very early stages of site identification can help focus the site selection process on the strongest candidate properties. This does not mean that the owner/developer of the property must spend tens of thousands of dollars on environmental investigations during site selection and initial negotiations. But it is important that the owner/developer make a well-informed decision based on his or her planned use of the property, business model, and budget.
A second reason to partner with an environmental consultant early is cost. There is a direct relationship between the physical redevelopment plan and the cost of remediation. For a large mixed-use redevelopment of a former industrial property, modest changes in the physical layout of the property can have a big effect on environmental remediation cost, and the impacts can be evaluated as part of site selection. For instance, if underground parking is proposed at the site, it could be located in an area with significant contamination issues, and then the cost of cleanup might be limited to disposing of contaminated soil. Similarly, many contaminant conditions can be managed by covering them with pavement or buildings. Cleanup costs can be minimized by choosing where parking lots and commercial buildings are located as compared to landscaped areas and residential buildings.
Of course, some cleanups may be driven by issues other than the use of the property. Some examples include contamination that is reaching the drinking water sources of other properties; migration of contaminants from groundwater into the indoor air of buildings on surrounding properties; and contaminated sediment or surface water in an adjacent river or lake. These types of issues are unlikely to be affected by changes in redevelopment plans and are often the most costly and complicated to resolve. By involving the environmental consultant early, these cleanup issues can be identified, separated from the real estate deal, and often left to the original owner to resolve - and pay for.
Environmental Cleanup Goals
How much cleanup is required or warranted? There is no fixed answer to that question because there is no fixed standard for the cleanup of a contaminated property. The level of cleanup is usually a function of the intended use of the property and, for a large piece of property with mixed uses, can change from area to area. The implementation of land use controls (LUCs), also known as institutional controls, often allows higher levels of contamination to be left behind by restricting access to the contamination. LUCs have allowed for the redevelopment of many properties that might otherwise have remained fallow. Conversely, when there are motivating factors such as a business advantage or a specific corporate philosophy, environmental cleanups may involve removing more contamination than required by environmental laws and regulations.
The impact of environmental stigma on a property can be very difficult to quantify. However, the potential for it to affect the success of a redevelopment may be changing. For many years, it has been assumed that neighbors would resist, or at least slow, efforts to redevelop contaminated properties when the redevelopment plan includes leaving some contamination behind. But significant outreach and education efforts by regulators, consultants, and developers have been steadily increasing the receptiveness and knowledge base of these stakeholders.
As a result, people in communities where redevelopment of a contaminated property is planned are in a better position to understand the real risks posed by the contamination, and can evaluate the value of the development on its merits. For example, at a former industrial property in a struggling section of Boston, the neighbors have all heard about and accepted that there are heavy metals and chlorinated solvents in soil and groundwater beneath the property. Over time, the residents have come to see the redevelopment as a way to control potential exposure to the contaminants and, more important, as a way to bring jobs and economic growth to the neighborhood. The neighbors are now some of the project's biggest advocates. Instead of insisting that every bit of contamination be removed, which would break most deals, communities are asking, "When can you start and when will the building be finished?"
Image Is Everything
concerns about the environmental stigma that may be associated with a
specific property and the cleanup costs, the potential effects of
environmental conditions on corporate image should be considered. We
have seen several recent projects where corporate decision makers have
been particularly sensitive to the attitudes of the workers who will
inhabit the building. There was a worry that any attempt to leave
contamination in place, regardless of the lack of risk opined by the
environmental experts, would be seen by the employees as management
getting a good deal on a contaminated property at the expense of worker
In each case, the employees have been highly skilled and
educated engineers and scientists who were in an excellent position to
understand and accept a decision to leave contamination in place.
However, the corporate managers chose to meet a higher cleanup level to
show their commitment to providing the best workplace possible. The
managers were particularly focused on maintaining their corporate image
of environmental stewardship and employee commitment because they use
these differentiators to attract the best employees.
How Much Will it Cost?
the cost of environmental cleanup can be a big variable, affecting the
viability of a redevelopment project. The first question from a
developer, usually well before purchasing the property, is how much
will it cost to cleanup the site? A developer negotiating a real estate
deal usually does not want to hear about the complexities of the issue
- he or she wants an answer. This is when scale and cost sensitivity
are important. A cost difference of $200,000 may be a big issue for a
manufacturing facility that is managing a fuel oil contamination
beneath the building as part of a yearly operating budget; but that
same cost difference may be insignificant when part of a $100 million
redevelopment of the same property.
Cost estimates evolve
throughout the planning process. The goals and limitations of a cost
estimate require careful communication between the environmental
consultant and the client. To evaluate a specific project, an accurate
cost estimate with a high degree of precision may be needed, and a
detailed subsurface investigation of the property, costing $50,000 or
more, may be required to support the cost estimate. But for a project
where less precision is needed, simply reviewing regulatory files to
establish that there is contamination and that it will cost $1,000,000
to remedy may be enough information for the developer to make a "go or
Developing cost estimates that are less precise
but still support the decision-making process will cost much less than
developing more refined cost estimates. Selecting the right approach
for any given site or situation requires an in-depth understanding of
the owner/developer's business decision process, cost sensitivity, and
corporate attitudes toward environmental-related issues. By working
with a consultant who understands this, you can reduce upfront costs
while getting the information you need to select the site and cleanup
level that best fits your plans and corporate goals.
Ash, PE, LSP, vice president at GEI Consultants, has more than 15 years
of consulting experience, concentrating on regulatory compliance
strategies, remedial design, and construction management. Patrick King,
PE, environmental division manager at GEI Consultants, has more than 13
years of experience developing subsurface investigations, evaluating
remediation alternatives, implementing response actions, and managing
contamination during construction. GEI Consultants is one of the
nation's leading geotechnical, environmental, and water resources
engineering firms. For more information, please visit www.geiconsultants.com.