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By Robert V. Colangelo
Traveling to many smaller cities within the U.S. and Canada to discuss brownfields
has allowed me to recognize the obvious: A surplus of functionally obsolete
industrial properties exists and they adversely impact the local economies in
which they are located.
These properties have little chance of being fully leased or sold for industrial
use for two reasons. First, new manufacturing and material handling technologies
have created a demand for modern buildings with upgraded infrastructure. Second,
the massive migration of industrial jobs overseas has reduced the overall demand
for industrial property outside major urban markets.
Recognizing you have a problem is usually the first step to recovery. A natural
tendency for many cities is to hold on to the past and hope that the same types
of jobs will come back after an industry moves on. The cities that can change
their perspective can attract different opportunities.
New business provides a chance to reposition old sites to a higher and better
end use. With a portion of these old industrial sites being brownfields, repositioning
these properties can often provide an incremental increase in property value
and create the economics necessary to provide additional dollars for site cleanup.
Houston is a great example of what can happen when cities move beyond their
historic core industries. For nearly a century, Houston had seen historic economic
highs and lows, following the cyclical nature of its major employer of the oil
and gas industry.
After the last oil boom (around 1985, when oil was at a low of $10 per barrel),
Houston began to diversify its economy. It invested in attracting a number of
growth industries, including aerospace, technology and health care. As the economy
diversified, the city became less dependent on the volatility of the oil and
gas industry. As new industry came into town, the real estate market began to
improve.
Both Sides of the Border
We are happy to report that the NBA will be hosting the first International
Brwonfield Summit in Niagara Falls, Canada on June 2–3, 2005. Each
year this event should grow and become the international meeting place for exchanging
ideas and experiences on public sector policies and private sector practices
that work for redeveloping brownfields. We feature the Niagara region (both
sides of the border) on pages 21 and 25.
In organizing this conference, we observed how public/private partnerships have
evolved over the years and provide a key tool for developing brownfields. In
the late 80s and early 90s, the U.S. government and the private sector were
at different ends of the table as they reluctantly or forcibly were brought
together to negotiate environmental compliance and enforcement issues. In the
late 1990s, voluntary cleanup programs began to change how the parties related.
Through the years, government and industry have worked diligently at building
trust and jointly working through the complicated issues that surround the redevelopment
of brownfields.
Canada’s nascent brownfield market is just beginning to forge these relationships
and learn the value of these partnerships. Observing the Canadian brownfield
market at its beginning shows just how far the U.S. market has come in the last
10 years. At the end of the day the fundamental issues related to the redevelopment
of brownfields are the same — it is the people, policies and local economies
that make them different around the world. BFN
Enjoy the read!
Robert V. Colangelo, Publisher
Robertc@brownfieldnews.com