Environmental Issues Challenge Commercial Real Estate

Mold, Brownfields Remediation, How To Hire the Right Consultant, Disaster Recovery and More

[ By Ron Derven ]

With Environmental Regs, Trying to Cut Costs Could Lose You a Bundle in $$$ and Time

"Controlling the legal issues is really controlling the costs," he said. "Look at property -- especially from a developer's point of view -- in three separate phases: pre-acquisition due diligence; permitting or entitlement of the property; and post-development continuation of use, if indeed that developer is the continuing user."

In the first phase, he explained, the first priority is to control the cost, which is somewhat counter-intuitive. "The better your consultants, although you pay more money up front, the more likely they are to catch a problem or solve a problem."

How do you find the best people? "When I have to leave jurisdictions where I am familiar with all the professionals," said the lawyer, "I go to the regulators and I ask them: Who do you see most often? Who has a good reputation? Who can you trust? Whose work is their bond? In all likelihood, those are the people who are skilled both technically and politically and then you can always check with the state engineering association."

When you get through the permitting process, you need someone who understands the permits and reviews them within the applicable review appeal window, explained the attorney.

A critical aspect for the development and post-development phase is to maintain careful records on everything that was done on the project. Said Nelson: "We have a client who finished building a large office/industrial project that was a brownfields site with contaminated soil. The problem was, with the soil removal process, there was no record or documentation of the local regulatory entities having approved the staging or ultimate disposition of those materials. The developer has a building that is up and he has tenants that want to come in, he has end-use post- construction financing that is on hold as he tries to go back and resurrect all of the pick-up tickets from the waste haulers and track those tickets down to the landfills where the material went. It is an expensive proposition in terms of money and time spent."

Avoiding Indoor Air Complaints, Problems with Mold

Why has there been an increased focus on mold in recent years? "Ever since the 1970s, building envelopes have been made tighter to save energy," said Wardlow. "While this is good for energy savings, it does not allow the building to breathe and dry out. When a roof leaks or a water line breaks, it is harder for the wet materials in the building to dry out."

Wardlow said that mold spores are everywhere and extremely beneficial to the environment. "The only place you will not find mold spores is in laboratory clean rooms. You and I are breathing mold right now. I like to tell people that if it were not for mold, there would be three feet of cigarette butts on every highway."

But when indoor building materials become wet, mold spores become amplified. If the wet condition goes undetected, it can cause problems and work into the heating and air exchange systems. "Then you may have a much higher count of mold spores inside the building rather than outside," he said.

For more information

CTL/Thompson
www.ctlt.com

Preparing For The Worst: Effective Disaster Contingency Planning Donna Childs, co-author of Contingency Planning & Disaster Recovery (Wiley) was working in lower Manhattan on September 11th, 2001, and is keenly aware of the need for small businesses to develop disaster contingency plans. Working with IT consultant Stefan Dietrich, she has put together a set of proven guidelines for small and mid-size businesses to effectively prepare for catastrophes. Among the issues that require preplanning: What to do if the main office location is not accessible Getting the business up and running again Contacting third parties Handling insurance claims Adequate insurance for property, business interruption losses and workers' compensation Rebuilding an IT infrastructure Childs said that successful planning not only can limit the damage of an unforeseen disaster but can also minimize daily mishaps - such as the mistaken deletion of files - and increase a business's overall efficiency.

Bring Together Developer, Lender & Regulator to Break Environmental Logjams

"The effective project consultant quarterbacks interactions with all of these entities to manage the expectations of what happens and in what order; what the timeframes are going to be and ultimately, what the costs are going to be," he said.

In order for these environmental issues to be managed properly, the due diligence function must handled properly, according to Uzzo. "Unfortunately," he said, "the whole concept of environmental due diligence has become somewhat of a commodity. For those who go with the lowest cost, they will typically get a product that may cut corners or may not fill in all of the blanks.

"Frankly, many times when I get retained as an expert witness on sites for other projects, it is examining the deficiencies of someone else's due diligence work," he went on. "It is amazing to think that people will spend millions of dollars to purchase and redevelop a property and yet they are worried about saving a thousand dollars on their Phase I environmental site assessment. Not having critical information from a due diligence perspective can cause problems in time delays, cost issues and other elements that will negatively impact a redevelopment project."

For more information

Whitestone Associates
www.whitestoneassoc.com

Danger Could Lurk Below the Floor in Your Office Building There is an increasing life safety threat in environmental air plenums, according to John Michlovic, H.H. Robertson Floor Systems, Ambridge, Pennsylvania. "The common practice of abandoning lesser performing cables in place and adding the next generation on top of the old is viewed as alarming by safety experts and code writers," he noted, adding that "something had to be done to reduce the threat of burning plastics in plenums. The action taken by National Fire Protection Association (NFPA) in its 2002 edition of the National Electrical Code (NEC) was a bold stroke for life safety. Abandoned communications cables are no longer allowed to remain in plenums. All involved parties should seriously pursue reduced fire loads in plenums through the removal of abandoned cable." Although the fire safety record in office structures has improved over the years, there are still 16 office fires in the U.S. on an average day, according to the latest NFPA data, said Michlovic. For new construction, designers should carefully consider the use of in-floor systems such as underfloor duct for on-grade use or a cellular floor system for elevated building levels. These systems provide the ultimate safety against cable fire and smoke problems by encapsulating cables in steel cells below a concrete fill. Underside fireproofing assures against cable outgassing for two to three hours. For more information HHRobertson Floor Systems www.hhrobertson.com

Electrical Resistive Heating Frequently Asked Questions

What types of contaminants does ERH clean up?
ERH works very well on chlorinated solvents like dry cleaning fluid and paint strippers and light-end petroleum products like gasoline and diesel fuel. ERH can assist existing recovery systems in cleaning up PCBs and heavy-end petroleum products like crude oil and motor oil. ERH will not work for metals.

What does ERH cleanup cost?
Costs are dependent on a variety of factors, however, they generally range between $90 and $140 per cubic yard. In addition, assuming that a comprehensive site investigation has been conducted, a fixed price to meet a particular cleanup goal can be developed.

How fast will it work?
ERH is relatively rapid and most cleanups can be conducted in months. Larger sites or sites with high initial concentrations may take longer.

Can ERH be installed and operated safely under a building?
Yes. ERH has been safely installed and operated under buildings. Cabling, piping, etc. can be installed beneath the floor if adequate access is available for the installation process.

Is ERH safe during operation?
Yes. The ERH system controls the flow of electrical current through the soil to minimize stray current. Grounding measures and rigorous monitoring for stray current occurs as the system is started up and throughout the cleanup period.

Will vapors migrate from the cleanup area to building interiors during operation?
No. A vapor recovery system eliminates the potential for vapor intrusion into buildings or operating facilities during cleanup. Indoor air is monitored during cleanup to ensure system integrity.

Can ERH be safely operated in areas where underground utilities are present?
Yes. If the underground utilities are constructed of materials that can withstand the temperature of boiling water--like concrete, clay tile, or metal--ERH can safely work around them. Metal construction materials may require grounding.

Will ERH work in all soil types?
Yes, including saturated soils and groundwater. However, ERH is most effective in clay soils. Depending upon conditions, it may not be the most cost effective solution for sandy soil.

When do you know when the ERH is complete?
Ultimately, completion is based on soil and/or groundwater sampling. Sampling begins when contaminant removal rates have slowed, and continue until clean-up goals are met and confirmed.

What happens to the underground components of the system after cleanup?
Generally the underground components are left in place, but can be removed if required for redevelopment. Jeffery L. Pope, P.E., Vice President, Director of Remediation Engineering, Environmental Services, Clayton Group Services, Chicago.

By Ron Derven, co-editor, Development.