Client: Real Estate Developer

Project: Guaranteed Fixed-Price Cleanup at a Former Manufacturing Facility

Location:  New Jersey

Description:    The client, a large real estate developer, was interested in purchasing a former manufacturing facility, and planned to demolish a majority of the vacant building structures and replace them with new and renovated industrial space.  The project also included the development of retail space on an undeveloped area of the property.

The owner of the property, a manufacturer of cosmetics, was going through the Industrial Site Recovery Act (ISRA) process, during which twenty-three areas of environmental concern (AOCs) were identified.  While the majority of these AOCs were addressed to the satisfaction of the New Jersey Department of Environmental Protection (NJDEP), some soil and ground water issues remained to be addressed.  As such, the property owner was concerned with liability associated with the potential future discovery of previously unknown contamination, and was unwilling to sell the property without certain types of legal assurances.
 
EWMA was retained by the developer to provide those assurances, and investigated and remediated the remaining AOCs.  The file information reviewed by EWMA indicated that shallow, intermediate and deep ground water underlying the property was contaminated with chlorinated volatile organic compounds (VOCs).  A pump and treat system was previously installed at the property to address this ground water contamination issue.  The prior consultant projected the ground water remediation cost via the pump and treat method to be in excess of $3 million.  Additionally, arsenic was found during previous sampling activities, but the extent of contamination had not been fully delineated when EWMA became involved.
 
After reviewing pertinent site data regarding the ground water contamination, and conducting a minimal amount of remedial investigation work to completely delineate the extent of arsenic contamination, EWMA was able to provide a guaranteed fixed-price remediation proposal to remediate the remaining AOCs.  The guaranteed fixed-price for remediation was then used by EWMA to obtain a Cost Cap insurance policy for the developer in an amount five times greater than the cleanup cost; something that is typically provided by insurance carriers only after receipt of NJDEP Remedial Action Workplan (RAW) approval.  EWMA was also able to assist the owner of the property in the procurement of insurance coverage to protect against the future liability associated with unknown contamination.
 
EWMA’s remediation proposal included the installation of enhancements to the ground water pump and treat system, along with the installation of additional wells, to optimize the recovery rates in both the shallow and intermediate zones.  To further accelerate the cleanup process, EWMA proposed the use of vacuum-enhanced total fluids recovery combined with a chemical oxidation (chem-ox) process.  To remediate volatile organic contaminants from the soil, EWMA used the on-site recovery wells for soil vapor extraction (SVE) purposes.

Because of EWMA’s diligent efforts to address contamination and legal liability issues at the property, the client was able to:

• Negotiate and complete the purchase of the property;
• Obtain a Cost Cap Insurance Policy without prior NJDEP approval of a Remedial Action Workplan; and
• Reduce the overall cost and timeframe for remediation of the property.