News Greenfield vs. Brownfield Developments: What’s the Difference?

Real estate development involves legal, financial, operational, and reputational risks. Selecting a site for development is a key part of managing those risks. Environmental contamination can significantly increase costs and cause construction delays, so many developers avoid Brownfield properties. But Brownfields offer their own unique opportunities that make investments worthwhile. We break down the difference between Greenfield and Brownfield developments.

What are Greenfields and Brownfields?

Greenfields are land that has never been developed and is generally presumed to have no environmental contamination.

Brownfields are land where development may be complicated by the real or perceived presence of environmental contamination.

Learn More about Brownfields

Things to consider with Greenfield developments

Pros of Greenfield developments

Greenfields are as close to a “blank slate” as developers can get. Properties can still present some hurdles because of their geography, but they support the widest array of possible uses. Specific potential benefits include the following:

• Less environmental uncertainty: Greenfields typically have a lower chance of environmental contamination.
• Less legal uncertainty: Because there are no structures or past development on Greenfield sites, there are less likely to be disputes in ownership caused by property inheritance, easements, tenancy/occupancy agreements, bankruptcy, and property abandonment.
• Greater design flexibility: Greenfield developers are not constrained by the need to work around or demolish existing buildings, and it is easier to subdivide or combine undeveloped parcels. Depending on whether and how adjacent properties have been developed, zoning may be flexible. Greenfields are more likely to offer room to expand in the future, whereas Brownfields are more likely to be constrained by existing development.
• Greater chance of site alternatives: If a site doesn’t offer quite what a developer is looking for or it is sold to someone else, then a Greenfield developer is more likely to find a comparable property than a Brownfield developer would. Brownfields sites are often one-of-a-kind locations.
• Shorter construction schedules and more predictable construction costs: Greenfields do not usually require environmental management plans or building demolition. The cost to build and install infrastructure on a Greenfield site can be lower.

Cons of Greenfield developments

While Greenfields are generally regarded as less risky to develop, they are not without their challenges. Specific potential drawbacks include the following:

• Distance from urban centers: Greenfields are more common in suburban and rural areas. As cities expand outward, undeveloped land is increasingly only available far from the urban core.
• Upfront infrastructure investment: Greenfield properties may or may not already be served by electricity, water and sewer, roadways, or solid waste management networks. Developers may need to pay to create these connections, even if they will eventually be turned over to municipal or regional agencies.
• Environmental disturbance concerns: Greenfield developers may not need to worry about environmental contamination, but they still have to abide by regulations regarding threatened and endangered species, wetlands and riparian buffers, and stormwater management.
• Few or no government financing options or development incentives: Developers should expect to need private financing for Greenfield projects. While it may be possible to negotiate incentives for Greenfield developments that further economic development goals, in general, these are the exception and not the rule.

Things to consider with Brownfield developments

Pros of Brownfield developments

Brownfields may present greater risks than Greenfields, but those risks can be managed by savvy developers and knowledgeable consultants. In addition to the liability protections provided by entering into a Brownfields Agreement, Brownfield developments also provide a set of tangible incentives and rewards. Specific benefits include the following:

• Access to funding, tax incentives, and technical support: Brownfields programs like the Brownfields Redevelopment Section in North Carolina provide grants, loans, technical assistance, and tax incentives that help make assessment, cleanup, and redevelopment more feasible.
• Reduced development pressure: Reusing previously developed land can help preserve Greenfields, limit sprawl, and support densification. Brownfields make use of existing infrastructure; if that infrastructure isn’t adequate, it’s usually faster and cheaper to upgrade than to build entirely new facilities for a Greenfield site.
• Economic revitalization: Reuse can attract private investment, support construction and permanent jobs, and turn liabilities into productive community assets. By expanding the local tax base, Brownfields redevelopment can also create momentum for further development.
• Community reinvestment: Redevelopment can transform vacant or blighted properties into housing, businesses, parks, public facilities, and other amenities that improve quality of life for the surrounding community.
• Environmental improvement: Assessment and cleanup can reduce potential exposure to contaminants, improve soil and groundwater conditions, and support safer long-term property use.

Cons of Brownfield developments

Brownfield developments are unavoidably slower and more restrictive than Greenfields. Specific potential drawbacks include the following:

• More site constraints: Redevelopment at Brownfields may be physically limited by surrounding development, legally limited by zoning restrictions or ownership disputes, or any combination of these. While the Brownfields program is tasked with making sure that a property is suitable for the intended use, not all sites can be converted to every use safely.
• Fewer site alternatives: Brownfield conditions are the unique product of a site’s history of ownership, usage, maintenance, and cleanup efforts. If a particular site can’t be remediated for a developer’s desired use, a comparable site may not exist, and the developer may need to revise their plans.
• Longer development timelines: According to the Brownfields Redevelopment Section, it takes on average 18 months from application acceptance to receive a Brownfields Agreement. Timing can vary significantly based on the complexity of the site and project, the responsiveness of the developer and their consultants, and the workload of state project managers. Developers may be able to expedite some parts of this process if they are willing to pay higher fees, but other parts, such as mandatory public comment periods, are non-negotiable.
• Higher development costs: Brownfields program costs vary based on the site, intended use, and how much data has already been collected. Development itself will be more expensive because it will include the cost to remediate or mitigate any environmental contamination. But Brownfields programs help to offset the larger investment by making assessment and cleanup costs transparent and reasonable and by offering tax incentives for completing the work.

How does WithersRavenel support developers?

WithersRavenel can help developers understand whether a Greenfield or Brownfield property may be the right option for their project. Unlike some environmental-only firms, our multi-disciplinary team of environmental and civil engineers, geologists, planners, and landscape architects have the resources and experience necessary to effectively evaluate, plan, and permit Brownfields development.