Does anyone have any ideas on the best way to market access to funds for brownfields investing, as well as a way to locate these properties. Thanks.
Mike Haltman
Hello halthouse1,
In some areas, brownfields represent great potential. I am in New Jersey and brownfields are common. They also represent some of the only available land for development in some areas and their value can be trememdous.
Getting funds to deal with them can be another story. Sometimes you can find matching funds within your State. Sometimes the owner, oil companies, gas companies, utility comanies will help with rememdiation as they hold the responsibility to clean it up. Too often though, the developer needs to take this expense on, especially if the site is owned by the municipality. In return, the developer often is deeded the brown site at a very low cost. Once remediated, the value of the land increase greatly, especially in areas that have no more available land.
Most of the funds we have seen brought into these things are straight out of pocket by the developer. It is a big risk but a great reward. I would suggest looking at some case studies and past remediation attempts to to get a greater understanding of how these things are pulled off. I see a lot of this going on in the Northern New Jersey area where towns that were once very industrial in nature have now changed and the only available land is the brown site. They would give you a good feel for the problems and challenges you would face and how the funding was structured.
Thank you very much
There are some lenders who specialize in financing brownfields.
I have a recent WSJ article with info on some that I will try to find for you.