by Steve Dwyer 

A New Castle County, DE redevelopment appears to have established a solid game plan, a plan that will serve as a strong tailwind to executing a beneficial end use outcome. 

The site is the former General Motors Boxwood assembly plant. As many well know, former GM plants represent a yeoman’s challenge in striking prudent redevelopment. In short, there are so many intricate tentacles that comprise such sites. Enter RACER Trust, a federal entity formed to finance former GM cleanups and then facilitate the appropriate sale—matching right owner with right seller. RACER was established by a federal judge in the aftermath of GM’s bankruptcy, and is predicated on its laser vision. 

As with other former GM sites under RACER’s aegis, the eventual property buyer must be aligned with what the local community needs.  

This game plan involves more than RACER’s oversight. The 3.2 million square-foot GM property in Delaware has the necessary components to execute a successful redevelopment. There’s public involvement via public hearings, environmental vigilance with the state’s environmental agency and a nod to historical preservation since one goal is to salvage legacy assets of this site. There’s also a prime transportation-logistical benefits since the property sits in the shadow of the I-95 corridor. 

Thomas Hanna, president of Harvey Hanna & Associates, which has experience with brownfield sites, witnessed through the Twin Spans complex in New Castle, said nearly 100 configurations for the 3.2 million square foot site have been developed. Options include keeping most of the massive complex in place to partial or total demolition. None of the plans include residential development as the site is zoned industrial.

As mentioned earlier, there’s vigilance being carried out via prudent environmental oversight by the Delaware Department of Natural Resources and Environmental Control (DNREC). As of early December, a waste treatment plant on the site is slated to remain in place in the hopes that the site can attract a sizable manufacturer—although manufacturing prospects are scarce in comparison to light assembly and distribution center candidates. 

Space at the site is already being marketed online with negotiations underway with international commercial real estate firm CBRE. If no agreement is reached, Harvey Hanna would either look for another broker or take the project in-house.

No leases have yet been signed, with Hanna telling attendees at a recent public hearing that the first major tenant would set the tone for the overall development. The goal will be finding the “highest and best use” with employers that pay good wages. 

From a timetable standpoint, there’s a 12- to 18-month window for ramping up to be tenant-ready, with build-out taking eight years. An estimated 2,000 to 3,000 jobs would be created, including construction positions.

This former GM site features great logistics from a transportation standpoint: The goal is to market the site on a regional or national basis for clients looking to capitalize on the proximity to the I-95 corridor.

Historical preservation is being realized as well, as plans are in the works to retain the property’s administrative building, which has art deco touches and dates back to the time when the DuPont family had a controlling interest in GM. 

Environmental oversight comes with the DNREC representatives, who recently reported that four out of six zones at the Boxwood site have been studied for environmental problems, and have received the green light.

Groundwater and heavy metals contamination appear to be confined to the plant site, which borders residential property.

The checks and balances of prudent redevelopment are always carried out best with strong communication mechanisms. This GM site comes equipped with this across many channels. Public input is strong as audience members attending public hearings have asked all the right questions so that the stakeholders remain focused and prevail in a community-advocacy mode. 

Here’s hoping that yet another former GM plant will show that past is prologue—most of the former GM plants up and running currently have been home runs in the way they have served the communities from social, economic and environmental positions. 

Editor’s Note:  BCONE was fortunate to hear from DNREC official, Paul W. Will,  regarding the Delaware Coastal Zone perspective on the revitalization of old industrial sites for multiple reuse.  Paul joined BCONE’s  lunch panel held at the National Brownfield Conference in December 2017;  Mr. Will, along with representatives from the PA Department of Community & Economic Development and Shell Chemicals, provided insights on exciting redevelopment potential and actual projects in 2 of the states in the BCONE footprint.  BCONE members who attended the RE3 Conference in Philadelphia in November 2017 heard from Bruce Rasher of the RACER Trust, who discussed the Trust’s progress across the country.  BCONE was an active participant on the RE3 developer panel selection committee.  Just a few recent examples on how BCONE keeps you informed on fascinating projects and programs in the northeast and mid-Atlantic regions of the USA and then continues the dialogue with informative articles by Steve Dwyer.  Please share you projects, programs and article with BCONE!

by Charlie Bartsch, Member of BCONE Board of Directors and Senior Strategist, Communities in Economic Transition Adviser, BRS Inc.  

President Trump signed the Tax Cuts and Jobs Act (HR 1) into law on December 22 – less than two months after the House and Means Committee released its initial tax reform proposal.  As you probably heard at the EPA brownfield conference in December, and read about in other sources, key tax code changes considered during the bill drafting process would have severely curtailed or eliminated critical federal business and real estate development incentives often used as part of the financing package typically assembled to advance brownfield site revitalization.  As I stated at the conference, losing these incentives would have undermined years of effort to “level the playing field” between brownfield and greenfield sites, by making it much more difficult – if not impossible – to attract the up-front capital needed to address fundamental property assessment and cleanup needs.       

The end result – now that the final law is in place – is that, overall, economic development incentives commonly used by developers and communities to promote brownfield reuse, threatened during the bill drafting process, emerged generally intact.  (However, previously lapsed tax incentives to offset brownfield cleanup costs were not restored as part of the reform of business credits).  On the other hand, the lower overall corporate tax rate will make many of these incentives less attractive to investors and others who had used these incentives to reduce their tax liabilities – and the ultimate impact of that on brownfield finance remains to be seen.   In addition, HR 1 as signed included a new “base erosion and anti-abuse tax” (BEAT) – essentially an international corporate AMT.  This may limit the ability of some corporate investors to fully claim credits from the incentives noted below, making them less desirable.  

• Historic rehabilitation 20% tax credits retained, but with reduced bottom-line value – One of the most important brownfield financing tools – especially for smaller projects of less than $1 million in size – has been preserved, although credits will now have to be claimed over 5 years upon project completion, rather than all in the year the restored property is put back into service. For large projects, this could affect the up-front syndication value of these credits; for small projects, it will likely require accommodating a new strategy for managing cash flow that addresses property preparation. In addition, the majority of states have their own historic tax credit programs, many synchronized with the federal tax code; the impact of this change in state credit time frames has yet to be determined.
• Non-historic rehabilitation tax credits (10%, for pre-1936 buildings) repealed – Not used nearly as often as the historic credits, the 10% credit nevertheless helped finance numerous revitalization projects involving the types of old buildings typical of brownfield properties, often for small economic development projects. Given this change, it may make sense for developers or communities to pursue historic designation for these properties, to take advantage of the revised 20% historic credit.
• New Markets Tax Credits (previously authorized 2018 and 2019 rounds) retained – Targeted to distressed low-income areas – the typical brownfield location in many communities – retention of NMTCs will channel $7 billion in private investment dollars to these areas nationally over the next few years, mostly for job generating real estate and business development projects. The tax act did not authorize NMTCs beyond 2019.
• Private activity bond interest exemption retained – A critical result of HR 1 was the continued availability of tax-exempt bonds to developers and state and local jurisdiction; while traditionally more of a tangential tool to brownfield redevelopment, PABs are a vital piece of public-private partnerships that finance manufacturing, infrastructure, hospitals, and other economic and community development investment.
• Low-income housing tax credits retained – LIHTCs (both the 9% volume cap and the 4% PAB credits) emerged with no substantive changes; they are critical to financing affordable housing development and have been used in numerous brownfield-to-housing projects across the country. (However, the nature of these credits, and who uses them, means that the lower corporate tax rate will make these credits less attractive to investors).
• Renewable energy investment tax credits, production tax credits retained – These credits, which have been integrated into brownfield repowering projects, will continue as is, with existing phase downs (after 2019 for ITC, after 2016 for PTC) retained.
• Investing in “Opportunity Zones” newly authorized – HR 1 included a new incentive to invest capital gains in new or existing businesses in state-designated “opportunity zones” in low-income communities, using criteria comparable to those for NMTCs. States will be allowed to designate up to 25% of their low-income census tracts as opportunity zones, for a 10-year period. HR 1 anticipates that “qualified opportunity funds” will be organized for purposes of investing in opportunity zone property. While the implementation specifics have yet to be defined, brownfield reuse advocates might be able to leverage their designation and operation to target distressed properties.

by Andrea Poinsett, GEI Consultants, Inc.

In December 2017, I was a first-time attendee to USEPA’s National Brownfields Training Conference (Brownfields 2017) held in Pittsburgh, Pennsylvania, a city known for its steel industry, demise, and subsequent revival.  Pittsburgh was also the location of the first Brownfields Conference about 20 years ago, making it a fitting location to show how progress can be made.  The goal of my first time at this conference was to absorb as much of all aspects of the conference that I could from the learning sessions to the networking to the exhibit hall.  

Inspiration from the Plenary Sessions:  A speaker during the Mayors Roundtable  said something that stuck with me because one issue always seems to be the cost of remediation and redevelopment.  The Mayor said that people question the cost of things when they don’t understand the value of those costs.  As a scientist and a consultant, I am constantly challenged to be the translator between the law and regulations and the client, who typically isn’t in the environmental business  People need to know that what they’re paying is worth their hard-earned dollars.  To remediate and redevelop brownfields, we need do show the community that the cost is worth it, that the value gained far exceeds the costs.  

Another speaker, a native of Pittsburgh spoke with passion about the changing face of the city where he grew up to the revitalized city that it is today.  One of the main takeaways from this session was don’t ever give up. 

By far my favorite evening event was the Community Reception held in the Senator John Heinz History Center.  BCONE was a proud sponsor of this event.  The Center was open for exploring during the event;  it was spacious, well attended and the if you were lucky enough, you got to talk with the curator who pointed you to the special collections area of the museum and the Mr. Rogers’s neighborhood exhibit. How cool to have a beer and eat lo mein with Fred Rogers!  

This conference is worthwhile for the diverse attendance and the number of attendees.  I met people from across the country.  I met representatives from Alaska who have their own unique brownfields issues, to people running nationwide non-profits looking for consultants, to vendors selling unique remediation products.  There were a variety of educational sessions-- with some unfortunately overlapping, forcing you to make the difficult decision as to which talk to attend.  The quality of the presentations, variety of sessions, and things to do made this a worthwhile experience for a first-time attendee.  I hope I get to go again.

by Steve Dwyer 

Call it a social-impacted development on steroids—even placemaking at its pinnacle. Riverton, a $2.5 billion 418-acre riverfront project located in Sayreville, N.J., represents the next generation of commercial real estate dubbed as “experiential mixed-use” or an “urbanburb” where six or seven uses are curated on one large site. 

Urbanburb markets itself as a suburb offering an urban lifestyle, and North American Properties (NAP) is in the process of capitalizing on its power and potential. The group is planning to move forward with Riverton by offering a mix of retail, restaurants, office space, hotels with resort-inspired services, parks and marina. 

NAP partnered with local company PGIM Real Estate for an updated plan, which was initially approved by state and local authorities in 2014. At the time, the project also obtained financial support from the New Jersey Economic Development Authority (NJEDA) through the Economic Redevelopment and Growth Program. The developers are counting on NJEDA’s contribution for Riverton’s new version, designed by Cooper Robertson.

Urbanburb was hatched after the NAP team visited hometowns in the area (including Montclair, Summit, Spring Lake, Princeton, Westfield, Red Bank, Asbury Park and Hoboken) for inspiration. Mark Toro, NAP’s managing partner, detailed the story behind the billion-dollar project, which will replace the former National Lead Paint company that had been abandoned for decades.

Boston and Chicago are other cities that have redeveloped former industrial waterfront sites and turned them into modern, mixed-use buildings and attractive public spaces. 

Riverton is poised to provide an unparalleled opportunity to serve the New York/New Jersey market, home to 16 million people, providing the next generation of commercial real estate, which is “experiential mixed-use.” The size and scale of Riverton enables the developer the “freedom to curate and deploy a full array of uses that will serve to energize the property 18 hours a day,” Toro remarked in a recent interview. 

The property is marked by unprecedented access to the region provided by full interchanges on three highways (35, 9 and Garden State Parkway). Plus, there’s an amenity package unique to any mixed-use property in the region: access to the Raritan River, Raritan Bay and the Atlantic Ocean.

Toro said that what makes this effort distinctive is a 400-slip marina that represents the centerpiece of Riverton’s public realm offerings, which will include parks, nature trails and intimate public spaces. The principal says the intent is to “energize the plazas and parks of Riverton with events and activations intended to engage the community and capture their imagination.”

Shops and restaurants will serve the Central Jersey clientele, but the real differentiator is the opportunity for Riverton’s residents, office workers and hotel guests to enjoy an unparalleled level of service and hospitality property-wide.

Community involvement and consensus building is in great supply: Thus far, the community has been engaged in the branding process, while the developer is establishing a dialogue on social channels to poll future guests as to what they prefer to see in the product mix. Those channels provide a unique opportunity to gauge public interest in various aspects of the project and, as a byproduct, build a sense of authorship and ownership among the followers. 

Pending approvals and financing, they expect to begin construction in the second quarter of 2018.  First phases will include residential-over-retail on Riverton Boulevard, followed by townhomes, office and hotel uses. Completion is scheduled in 2021.

by Steve Dwyer

You know the drill when it comes to accessing all the disparate elements of a complex redevelopment footprint. 

Brown University officials in Rhode Island were recently sidetracked by discussions about the future of a massive, century-old power station that sat vacant on the Providence River along its campus.

Questions abound: Leave it alone or dismantle it to pave the way for a new university structure?  Often times with legacy structures like a former power facility, razing it becomes a case of doing more harm than good. 

Enter the spirit of historical preservation, and it happened as part of the university’s quest to establish a unified redevelopment plan—in this case built around academia and medical technology. 

In the Brown University case, the plan was to create student housing in this city’s historic jewelry district. The developer, Richard A. Galvin, the president and chief executive of CV Properties in Boston, convinced Brown officials that the power plant could be parlayed into a property that would enhance Brown’s other investments in the district, including its medical school. Lined with 30-foot arched windows, the brick building provided vast views of the river and the city beyond.

Brown recruited the University of Rhode Island and Rhode Island College, which were jointly looking for a site to build a nursing school, and then helped negotiations with the state to secure a long-term lease agreement. Currently, a public nursing school and the Brown administrative staff are housed together in a refurbished power station at the edge of an emerging innovation and design district.

From a logistical standpoint, Brown administrative offices are now all in one place instead of scattered around its main campus. The nursing school, close to both the medical school and two hospitals, is also able to train students in state-of-the-art health care simulation labs. 

Sometimes, when you want to create an innovation district it’s actual innovation that drives the process. What do we mean by that? Well, this redevelopment play was all made possible due to results-driven networking among not only public/government and private sectors, but you can also throw in the academia component as well.  Brown University’s initiative serves as one more shining example of the importance of a unified vision of a private-public partnership.   

In fact, the trend toward vertical-driven innovation centers—academic in nature or otherwise—is an idea that has truly taken wing. Bruce J. Katz, a scholar with the Brookings Institution who was a co-author of a 2014 report on innovation districts, indicated at that time that any type of shift in the “geography of innovation” was still largely undefined. 

By 2017, Katz had forged a new opinion. He said he was “hard-pressed to come up with a city that’s not thinking about” establishing innovation chubs, and often times it’s being done around civic waterfronts. 

One can look to Chattanooga, TN, which in 2009 leveraged an ultra-high-speed broadband network installed by the city-owned utility to start a downtown innovation district. Expansion is likely to require strengthening the district’s partnerships with the University of Tennessee and the public school system, said Mayor Andy Berke, who noted that the United States Dept. of Energy’s Oak Ridge National Laboratory opened an office in the district last year. All total it encompassed more than 4,400 acres. 

This undertaking was a yeoman’s effort but was well worth it. Do you have an innovation center redevelopment concept that’s poised for execution? 

§  Proceed w/o DEP approvals

§  Annual fees not DO fees

§  Continue in “normal” DEP submissions

§  Feasibility Study not required

§  RP can select remedy

by Natasha Windstorm, Pittsburgh Tribune-Review (PA) 

Gov. Tom Wolf announced Wednesday that the state will pitch in $15 million in tax credits to expedite construction at Hazelwood Green — the site of a massive abandoned steel mill that a group of nonprofits hopes to transform into a bustling corporate hub for research and technology.

The Commonwealth Cornerstone Group's New Markets Tax Credit funding ensures that the first of three office buildings planned at Pittsburgh's last big brownfield can begin construction early next year and be ready for occupants by spring 2019, said Donald Smith, president of Regional Industrial Development Corp., the Downtown Pittsburgh-based nonprofit real estate developer awarded the tax credits. 

"It's huge. Literally the project couldn't happen without it," said Smith, whose organization owns the ionic Mill 19 building, a portion of the Hazelwood Green development.

…

For the entire article, see

http://triblive.com/state/pennsylvania/13116847-74/gov-wolf-announces-15m-tax-boost-to-transform-former-steel-mill-into

by Jeff Mill, Middletown Press (CT)

The town is proposing to buy a 5.5-acre parcel of land along the Connecticut River that could be used to house a visitor’s center, a museum detailing the quarrying of brownstone and, possibly, a riverfront restaurant.

The town has been working for years to acquire the property, the site of the former Connecticut Tar & Asphalt Co.

…

The property, which is actually the combination of three parcels of land, was formerly an oil-tank farm. It is owned by the estate of John Balletti, officials said.

The town has already used a $200,000 state grant to determine the presence and level of petroleum oil lubricant contamination on the site, First Selectwoman Susan S. Bransfield said following the selectmen’s meeting.

“That property has been reviewed and tested — thoroughly tested — and we have developed a solid plan for cleanup,” Bransfield said. The town has secured money to pay for it, too, she said.

…

For the entire article, see

http://www.middletownpress.com/news/article/Portland-seeking-to-buy-land-along-Connecticut-12439245.php

by Steve Dwyer 

With CT Gov. Dannel P. Malloy’s signing a bipartisan state budget to stop Connecticut’s lengthy fiscal stalemate, it appears a new program to support remediation and reuse of brownfields is going forward minus any tweaking.  

Within the master budget, the Connecticut General Assembly in late October passed a new program called “7/7”  Brownfields Program: that creates new incentives that the Connecticut Department of Economic and Community Development (DECD) can use to reward new investors for cleaning up contaminated sites and reusing them while creating local jobs in the process. It also appears that the law would greatly remove the specter of third-party liability, which scares away many would-be stakeholders from pursuing such projects.  

On Oct. 31, Gov. Malloy used his limited line-item veto power to focus only on eradicating portions of the General Assembly’s language related to a problematic tax on state’s hospitals.

The Connecticut budget impasse required Malloy to run the state using his limited executive spending authority, which in turn prompted cuts to social service programs and schools. Many municipalities also faced potential crediting rating downgrades because of the doubt over state grants.

Within 7/7 Brownfields, qualifying investors can apply a credit for the expenditures against their Connecticut state income tax liability for seven years and use the credit to offset sales and use taxes.

The 7/7 Brownfield Program is not available if the party is responsible for the contamination or pollution issues.  Eligible participants must be bona fide “prospective purchasers” or innocent landowner.

To qualify as eligible under the new program, investors in brownfields will be required to apply to DECD with the following stipulations as conditions: 

Description of the real property to be acquired and the proposed use; 

A certification from the eligible owner that the site qualifies as a brownfield or from the municipality that the site has been underutilized or abandoned for at least 10 years;

A jobs plan that the eligible owner will submit to area high schools and regional-community technical colleges that includes the anticipated workforce needs for the proposed reuse of the property and proposed workforce training needs in order to enable such high schools and regional-community technical colleges to meet such needs; 

A commitment from the eligible owner to hire not less than 30% of its workforce from students enrolled in such programs; 

A written certification from the municipality supporting the application as a qualifying 7/7 site; and 

Any other information required by DECD in regulations to be adopted soon.

The 7/7 Brownfields Program indicates that any 7/7 participant that seeks to redevelop and reuse a brownfield shall be able to claim the tax credit and offset sales and use tax expenditures once the brownfield remediation has been completed and verified, and the participant notifies the DECD and municipality that the cleanup work is completed.

by Eli Freund, UConn Today (CT)

Connecticut’s municipalities are dotted by hundreds of brownfield sites with remnants of toxic chemicals and industrial waste from years of unregulated activity. Federal and state assistance is available for cleanup, but the expertise and resources for the intensive process to secure those funds are not.

UConn’s new Connecticut Brownfields Initiative aims to bring much-needed assistance to the redevelopment of these sites.

“Different municipalities have different levels of readiness and resources,” says Maria Chrysochoou, associate professor of civil and environmental engineering and director of the new initiative. “Cities like Stamford and Bridgeport have built up the staff and expertise to successfully go through the process. But smaller towns sometimes don’t have the resources to put together winning proposals, which impedes their economic development opportunities.”

…

For the entire article, see
https://today.uconn.edu/2017/12/brownfield-remediation-gets-groundswell-support-uconn/