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Best Practices for Successful Urban Redevelopment

11.13.19   Daniel R. Cassidy, CPG | More by this Author

Best Practices for Successful Urban Redevelopment

Brownfields redevelopment is expensive and not for the inexperienced community or developer. Market forces alone are insufficient to complete brownfield projects. Urban environments often have high concentrations of complex environmental issues, geotechnical challenges, community prerogatives, and increased construction costs.

Here are four successful strategies for public-private partnerships working together to create a brownfield financing program to overcome the extra costs of redeveloping urban brownfield properties and eventually drive revitalization of communities.

Teambuilding – These types of projects need environmental, architectural, engineering, construction, finance, governmental, and legal professionals who have brownfield specialty within their respective fields. Brownfield projects are notable in the high level of overlap between these professional specialties, so defining roles and responsibilities and setting expectations can be challenging. Collaboration is essential, but it is easier said than done. Strategic organization of the partners into an effective team takes experience and intuition.

Timing – We all know that it is important to start early on brownfield projects to create strategic partnerships between the private developer and local, state, and possibly federal agencies. Its also wise to conduct sufficient investigations upfront to know everything you need to know about environmental conditions, geotechnical issues, design, and construction cost before beginning redevelopment. Of course, no project has a budget that permits perfect prior knowledge, so how do you decide what to do, when? Planning strategies, risk and risk tolerance, and development benchmarks are key.

Financing – Brownfield projects come with extra costs that usually cannot be absorbed by the private market. Public-private partnerships (P3s) and creative solutions for cost reduction are a must. In general, sources and tax incentives such as federal and state grants and low-interest loans, tax abatements, and tax increment financing are relatively common. However, coordinating these incentives between team members (e.g., contractors, governmental units, and financial institutions) can be difficult. In addition, the public processes required by P3 projects involve significant investment into team management and public outreach. Coordinated and well thought out communication is essential. It requires early and frequent communication and coordination between the public and private partner. Other less common financial benefits include strategic property acquisition, creative mezzanine financing, tax credits, philanthropic sources, and senior debt negotiation.

Execution – Good project management lays a foundation for successful execution through teambuilding, solving timing challenges, and creating a resilient and feasible financial plan. However, execution can be the lengthiest and most difficult segment of urban brownfield redevelopment.

Although redeveloping urban brownfield sites is expensive and challenging, it drives revitalization of communities. Experience shows that its issues can often be solved by experienced teams who plan well, who communicate well, who are inclusive, and who can deliver. For more information, contact Dan Cassidy, CPG.

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