Company Has Great System To Make Money In Redeveloping Brownfield Properites - Don't Redevelop Them
In 2017, a Missouri-based corporation called Jaines LLC forked over $9.6 million in exchange for 110 acres of vacant buildings and cracked concrete in Janesville, Wisconsin. The corporation was an affiliate of Commercial Development Co. (CDC), which bills itself as North America’s leading redeveloper of industrial brownfields, and the vacant lot was the former site of General Motors’ Janesville Assembly Plant, which had employed a tenth of the town’s workforce before closing in 2009. CDC billed its purchase as the beginning of an economic rebirth, touting the site as a “strategic opportunity for new manufacturing, warehousing and logistics-related development activity.” It proceeded to demolish the plant and auction off the equipment salvaged from the site.
Since then, large piles of rubble have continued to dot the property, in violation of city ordinances, according to city manager Kevin Lahner, who reported that the company has been regularly delinquent on its taxes. The property remains under Jaines LLC’s ownership despite at least one attempt to sell it. Frustrated by the company’s lack of progress on bringing the site back into productive use, city officials moved to condemn it last year. Of CDC’s initial promises of cleanup and redevelopment, Lahner said, “the city of Janesville was sold a bill of goods when they acquired that property and now we’re trying to un-ring that bell.”
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The Tanners Creek Generating Station was a hulking, 1,100 MW coal power plant that had loomed over the town of Lawrenceburg, Indiana, for more than six decades before it shut down in 2015. Like many legacy industrial sites, the land occupied by the power plant was contaminated enough to be less than useless to its owner, the electric utility AEP, prompting the company to engage CDC in a type of asset transfer called a “negative value transaction.” In late 2016, AEP paid an LLC affiliated with CDC a whopping $92 million to assume ownership of (and liability for) the property. Negative value transactions are a recurring feature of CDC’s business model. The company and its affiliates have signed such deals with electric utilities, landfill operators, chemical manufacturers and toxic waste dump owners, taking in tens of millions of dollars in exchange for the properties and their associated liabilities. In other cases, such as a metal refinery in Washington and a chemical plant in Georgia, CDC purchases properties out of bankruptcy proceedings, allowing it to assume ownership at a low price.
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Having undertaken remedial work, CDC marketed the land that had once housed the power plant, billing it as “a rare opportunity for an industrial user.” According to property records, CDC has sold its holdings to industrial developers, land conservancies and municipal governments, sometimes within two years of acquiring them. In the case of Tanners Creek, however, reuse proved more elusive. A provisional plan to turn the site into Indiana’s fourth port—a huge economic windfall for Lawrenceburg—fell apart in 2020 when an environmental survey turned up evidence of toxic chemicals—including arsenic, lead and boron—as deep as 40 feet beneath the surface. “Remediation work would take years to complete on a significant portion of the land, rendering the site economically unviable as a port facility at this time,” Ports of Indiana concluded. The undeveloped acres in Lawrenceburg have counterparts across the country. Of the 63 brownfield sites Inside Climate News investigated, only 15, fewer than one in four, have been fully redeveloped since CDC acquired them, with some remaining vacant for a decade or longer.
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https://insideclimatenews.org/news/12012025/commercial-development-co-makes-millions-from-brownfields/
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