Location, Location, Location. This remains one of the critical aspects of real estate development. The other is that “it’s not about the money, it’s about the money.” So, while the redevelopment of Brownfields makes people feel good, at the end of the day, a Brownfield site has to be in the right location for a redeveloper or buyer, and has to make economic sense. Currently, a number of trends in real estate desirability are making Brownfield sites the perfect location for redevelopment and reuse. At the same time, as programs concerning cleanup, funding and risk management have become more favorable, the return on investment, or economic viability, of properties has also increased. This article will examine some of the key aspects of desirability and viability that are working together to make Brownfield redevelopment increasingly attractive in today’s real estate market.
Market Desires
A Brownfield is “real property, the expansion, redevelopment, or reuse of which may be complicated by the presence or potential presence of a hazardous substance, pollutant, or contaminant,” Small Business Liability Relief and Brownfields Revitalization Act, 42 USC Section 9601 (39). These are often former industrial properties located in areas of high density within urban limits and along river corridors. In part, increased redevelopment and reuse of Brownfields is simply a product of the overall economic recovery, and a product of the greater comfort project participants have in using contaminated property. But beyond that, to satisfy the criteria of future users, there are some definite advantages to Brownfields over greenspace. For example, for manufacturers who have experienced increased production, relocating to a larger, moth-balled factory can have significant benefits over constructing a new facility in a greenspace. These include existing utilities, an available workforce (i.e., cheaper labor than in a remote area), and perhaps even the ability to retain existing employees and avoid the costs of hiring and training new employees.
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