Which path to choose, Greenfield design-build vs Brownfield, repurposing an existing warehouse?

Greenfield Projects are those where deferent aspects of the project are to be done from scratch. Brownfield projects are those where the preliminary development of the site is already done, and the investors come in with the required expertise. Feasibility studies would have been completed and either the profitability is determined or, a Pattern of subsidy to reach break-even, and achieve some nominal profit would have been identified and put in place.

Greenfield

There are many reasons for a firm or an individual to decide whether to build a new facility rather than purchase or lease an existing building. The primary reason is that a new facility offers maximum design flexibility and efficiency to meet the project’s needs. An existing facility constrains the designer to adjust to the existing site conditions.

In most cases, the main infrastructure of an existing building will need an overhaul maintenance effort. New buildings in most cases, require much less budget to maintain in comparison to aged buildings.

 Brownfield

The evident benefit of a brown-field investment strategy is that the structure is already constructed. The upfront costs for buildup will considerably be reduced. There will also be an acceleration in timetable for utilizing the building as in most cases retrofitting an existing facility takes less time than to build a completely new building.

Most of the time brown-field facilities are already “up to code” and require less time to pass permitting process.  In cases the facility is planned to be used for a similar line of business as originally designed this is even a bigger plus and saving in rehabilitation costs.

What is usually referred to as greenfield engineering or greenfield construction is the procedure of building a structure over a lot that has never been developed. Brownfield engineering is related to developing or building over a property that was previously developed and requires additional steps and planning.

Greenfield Engineering

Greenfield areas are normally undeveloped areas highly recommended for new construction. The benefits of greenfield construction relate to pristine pieces of land with little to no contamination that contains no structures in the premises. The most beneficial advantage is that there is no cost related to environmental remediation and is ready to start building right away.

The most important drawback is that greenfield is usually located outside city centers that might require additional infrastructure upgrades but those are offset by more accessible land costs. Another advantage is that they offer larger pieces of real estate ideally for future expansion and their zoning classification is easier to be changed or adjusted as required. Keep in mind that greenfield usually requires deforestation and could affect environmentally sensitive areas including the habitat of endangered species.

Greenfield construction advantages:

•          Ample space to build

•          Better planning due to open land access

•          Less unknown

•          No contamination

•          Sizing of property is not an issue

•          Low property cost

•          Future expansion possibilities

•          Flexibility to use larger equipment

•          Road posting might affect deliveries and schedule

However, some of the drawbacks are:

•          No accommodations for crews, per-diem might be required

•          Additional infrastructure costs

•          Limited local suppliers

•          Deforestation and environmental permits could take longer due to the impact on sensitive areas

•          Additional costs due to location, and temporary offices (power, facilities, and warehouse space)

Brownfield construction

While greenfield is undeveloped land, brownfield construction is related to pieces of land that have been previously developed and might be contaminated. Since brownfield properties are environmentally challenged, additional remediation costs mandated by EPA and other agencies will affect the total construction cost and the project budget. The main advantage is the location and easier access to the property including existing infrastructure in the area.

The EPA (Environmental Protection Agency) established a Brownfields Program in 1995 and is the guideline to develop a rebuilding plan. In some localities, certain incentives, including tax benefits are introduced to encourage redeveloping existing/abandoned buildings as part of community improvement plans. Some of the lots have higher value due to the location and some may encounter challenges related to zoning requirements and location.

The main advantages of brownfield construction are:

•          Existing infrastructure in the area

•          Accessibility for deliveries and workers

•          Some cities might offer tax incentives

•          Might qualify for additional LEED points

•          Historical data such as Geotech and plats might be available

•          EPA grants are available for future development

•          Job training grants available through EPA program

•          Job creation in city centers

•          Can increase property value to nearby properties

The main disadvantages of brownfield construction are:

•          Limited parking space for crews

•          Hazardous material on-site and in soil

•          Demolition activities might increase development costs

•          Zoning and permitting requirements might be the limiting factor

•          Finding the right land with the required sizing requirement might be difficult

•          Limited storage space for material

Although there are many parameters to consider when deciding on the roadmap to follow, ultimately the decision will be based on economic and special location requirements that could not be in your hands but being informed is good to make the case for your recommended location. Always consult with your local state and federal agency on additional permits, requirements, and costs associated with developing in brownfield and greenfield sites.

Whichever path is more suitable to your project, InnoDez has the competency and wealth of hands on experience to support your design activity for both greenfield as well as brownfield projects.