From Brownfields to Goldfields

“Potential site contamination. Remediation required.”  

This phrase strikes fear into the hearts of investors and developers looking to finance their next project. An already strenuous process of site evaluation, plan development, and investment soliciting grinds to a halt as developers question whether clean-up efforts and future liabilities are worth further investment of time and resources. It is usually at this point where developers opt for a lower risk route, continuing the site’s cyclical process of abandonment and untapped revitalization.

These sites, known as brownfields, are former industrial or commercial sites suspected of environmental contamination. Brownfields can include places like gas stations, dry cleaning operations, and chemical factories. They can be contaminated with anything from crude oil to lead, and a host of hazardous materials to the environment and human health that enter a site’s soil and groundwater. Over 450,000 brownfield sites are estimated to currently exist in the United States.

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Brownfield site in Cambridge, MA. Photo Credit: Engineering at Cambridge.

In North Carolina, the Department of Environmental Quality (DEQ) offers incentives for developers to invest in brownfields. The DEQ creates ‘brownfield agreements’ with potential developers, allowing the state to negotiate clean up requirements for developers in exchange for granting ‘not to sue’ covenants to prospective developers. Sharon Eckard of DEQ noted a substantial rise in the number of brownfield agreement applications submitted; almost 90 brownfield agreement applications were submitted in 2015 compared to just 63 in 2014. North Carolina’s Brownfields Program also provides property tax incentives, granting five years of partial exclusion from taxes following the completion of state mandated improvements to brownfield conditions. While participating in the program may cost developers over $30,000, the amount saved over a five year period has proven to entice developers in the state, especially for large-scale commercial projects in downtown areas.

If a developer decides to partake in a brownfield redevelopment process, the site undergoes a Phase I Environmental Site Assessment to determine whether contaminants actually exist on the property. If no contaminants are found on the site, development may proceed. However, if the results of the Phase I assessment are inconclusive, a Phase II assessment would be required. While federal funding can be acquired for assessments, evaluation costs can be as high as $20,000. If contaminants are found during Phase II, remediation would be required in order to repurpose the land for uses suitable for humans. While the cost for remediation strategies varies, it is estimated that the average cost of brownfield remediation totals $600,000.

Despite the steep costs of remediations, redeveloped brownfield sites result in an average benefit value of almost $4 million. Many developers across North Carolina have taken advantage of the state’s Brownfield Program incentives. The redevelopment of the American Tobacco Campus in Durham currently serves as the embodiment of how brownfield redevelopment can reignite a city’s economy.

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American Tobacco Campus. Photo Credit: Flickr Creative Commons.

Raleigh Union Station is a current brownfield redevelopment project occurring in western Raleigh. Union Station will be a multimodal transit station for Amtrak and the Southeast High Speed Rail Corridor (SEHSR) trains, and will be housed in an adaptive reuse of the Viaduct Building, a relic of the city’s industrial past. Once completed in 2018, Union Station will serve not only as a regional transportation hub for the state and the southeastern United States, but also as a civic hall for public events and commercial rental spaces. The alternative for this brownfield site would result in “no revenue for the city” as mentioned by Eckard. She has been involved in revitalizing many of the brownfield sites surrounding the new Union Station. The Contemporary Art Museum of Raleigh, which opened in 2011, and the Dillion, an ambitious seventeen-story mixed used project located at the site of the historic Dillon Supply Company, are both indicators of the untapped potential of brownfields in West Raleigh and other urban centers.

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Model of Raleigh Union Station presented by John Gallagher. Photo Credit: Pasan Perera.

Though it serves as a tool in combating urban sprawl and economic decline, brownfield redevelopment continues to face an uphill battle. John Gallagher, a former partner of Cherokee Investment Partners, believes one of the major issues he faced when soliciting investors is the negative connotation surrounding brownfields. Rather than referring to these sites as ‘brownfield,’ Gallagher suggests using ‘goldfields’ to indicate an opportunity for growth in investment. This simple change in terminology is believed to make all the difference in swaying community opinions on brownfield redevelopment.

A word of caution from brownfield remediation relates to post-redevelopment results. Often times, remediation and redevelopment increase the property values of former brownfield sites and neighboring areas, which in many cases leads to gentrification and related socioeconomic issues. Northeast Central Durham, a historically African-American neighborhood, currently contains thirteen vacant brownfield sites. Though brownfield redevelopment in this neighborhood may prove to be lucrative, we must remember that the residents lived through the economic hardships embodied by the abandoned building and endured the health and environmental impacts. As planners, we must realize that as new life comes to abandoned sites, those who survived the adverse impacts of these sites must also be able to reap its benefits.

Featured Image: Exterior view of Raleigh Union Station’s main entrance. Photo Credit: NCDOT Communications.

About the Author: Pasan Perera is a first year Master’s student at UNC’s City and Regional Planning Department. He is a native of Carrboro, NC. His interests lie in brownfield remediation and redevelopment, and how these processes impact marginalized communities in the surrounding areas. Outside of school, Pasan enjoys boxing, Law & Order marathons, and frequenting food trucks in the Triangle area.