Turning urban blight into upscale brilliance
Imagine a piece of prime real estate in a top 10 metro area with convenient access to public transit, but suffering from urban blight. Our client had the imagination to turn this aggregation of abandoned and under-utilized commercial buildings into mixed-use multifamily, office, and retail as part of their smart growth development plans.
The Problem? How to make the numbers work when others could not. Development costs were fairly well known, but environmental liabilities due to historical site operations, existing structures with asbestos and lead paint, archeological issues, and an unknown quantity of impacted soils and shallow groundwater made this project very risky to develop and finance.
With a thorough Phase I Environmental Site Assessment, detailed Phase II Investigation, and a clear understanding of the regulatory approval process, Blackstone was able to quantify these risks with enough certainty to obtain construction financing for our client.
In addition, through pre-characterization of site soils and sequencing of earthwork activities, Blackstone reduced initial reserves for contaminated soil and groundwater from $1.8M to $750,000. This reduction in earthwork budget resulted in higher level finishes for the residential units and provided financial protection against future change orders and delays.
Today, the site is a very desirable address with convenient access to public transportation and nightlife. A once run-down and dangerous corner is now a vibrant community for young professionals. Our client’s mission was fulfilled by the development and full lease up of a mixed-use community with superb access to public transportation.
With over 40 years of combined experience, industry veterans Stephen E. Manelis and Sean T. Dundon had a vision of creating an environmental and engineering due diligence firm providing unmatched technical expertise. Mr. Manelis and Mr. Dundon joined forces in 2001 to form Blackstone Consulting LLC as the leader in commercial real estate due diligence. Incorporating integrity, quality, responsiveness, and value into its services, and structured for efficiency and flexibility, Blackstone remains a step ahead.