WCD Capital Partners LLC
WCD Capital Partners provides targeted solutions for real estate development and management. The company is actively involved in contaminated property acquisition and remediation and the Brownfields program. WCD Capital Partners, acting independently or with financial or development partners, acquires contaminated properties, engages in risk assessment, financial modeling, full scope remediation and returns them to productive use. In addition to providing capital, WCD Capital Partners can participate in all phases of a project, in both an advisory and management capacity.
Acquisition and Redevelopment Strategy for Environmentally Challenged Properties
About WCD Capital Partners
WCD Capital Partners (WCD-CAP) was founded by environmental construction, finance, legal, and insurance professionals who identify significantly undervalued, contaminated properties and return these properties to productive use. WCD-CAP has developed an innovative approach to bringing capital, insurance, engineering, and remediation management to a challenged property and then returning that property to its true economic value. WCD-CAP works with financial and development partners to acquire contaminated properties and engage in full scope remediation. In addition to providing capital and managing portfolio investments, WCD-CAP participates in all phases of the project, in an advisory, financial, remediation, development or management capacity.
Mission and Objectives of WCD Capital Partners
- Identify, restore and return distressed and contaminated properties for social and economic use.
- Structure and provide both debt and equity for the acquisition, remediation, restoration and development of contaminated properties.
- Provide technical, risk management and regulatory expertise to facilitate and expedite transactions.
- Perform remediation of contaminated sites and restoration or demolition of contaminated buildings in accordance with Federal, State and local regulation.
- Provide insurance and risk transfer mechanisms for the transaction and the restoration work by A+ rated carriers, with limits of $50,000,000 available.
- Perform all new development and construction to LEED standards.
The Brownfield Marketplace
An "environmentally challenged" property is commonly known as a "Brownfield property." Brownfield programs are typically associated with some level of governmental economic assistance program. WCD-CAP looks at environmentally challenged properties that make economic sense without government assistance. The general belief in the investment community is that the risk is greater than the reward with such contaminated properties. The opposite is true. Many corporations today have elected to fence in their environmentally challenged properties and keep a minimal staff on site (when structures are present) to avoid the need to perform the required regulatory closure activities or the need to quantify the actual potential exposure as part of their financial reporting requirements.
Many of these properties reside in some of the most highly industrialized port cities and urban communities in the United States; those with high economic value. Currently, only a handful of engineers/developers have attempted to target this marketplace, but nothing has existed on the scale or level of sophistication necessary to minimize the risk and make these opportunities attractive investments in the capital markets, until now.
Indemnification
Many corporations and property owners lack the appropriate incentive for moving their environmentally challenged properties back into productive use because the majority of marketplace buyers neither fully understand nor have the ability to accurately quantify the clean-up costs or properly offset and capitalize the risk. WCD-CAP provides the incentive through their unique indemnification insurance strategies. The insurance marketplace offers ways to transfer/limit the environmental exposures related to a project and remove the obstacle to redeveloping and revitalizing local economies. The available insurance products include:
- Cap the cost of the work
- Insure the on-site activities of WCD-CAP and all sub-contractors
- Insure the transportation of off-site waste and material
- Insure the disposal and/or destruction of the waste
- Provide second-party liability protection
The exact components of an environmental insurance program for a site can vary greatly based on the specifics of each project. The finite program will be tailored to the specific clean-up activities at each site. However, most programs generally require the blending of various environmental coverage.
Making the Owner a Partner in the Process
WCD-CAP prefers to partner with the existing property owner, who retains the site's historical knowledge, rather then purchase the property outright (although we are able to do the latter as well). This avoids the need for complex future value negotiations in the purchase/sale agreement and allows for all parties to mutually profit when the property is returned to market value and a useful life. Moreover, the owner shares in the political credit with the community by demonstrating its performance as a responsible citizen.
Current Trends: "Going Green"
As the industry continues to refocus attention on "going green" and investing in LEEDS (Leadership in Energy and Environmental Design) certified projects, the majority of the capital markets has been slow to recognize the investment potential and the positive exposure that is available by working on an environmentally challenged property or project.
As these initiatives evolved, the number of parties participating in these transactions has increased and their interests have diversified. With access to greater financial incentives and assurances, including more and better solutions to address environmental contamination commonplace at closing sites, a greater number of parties have been attracted to these transactions. Typically, the groups involved include local municipalities, remediation contractors, redevelopers, public and private sector partnerships and joint ventures, and institutional investors.
The financial benefits and protections now available for companies associated with Brownfield projects take many forms. They include the division of clean-up costs and liability among interested parties through executed consent agreements, environmental services cooperative agreements (ESCAs), environmental insurance, covenants not to sue, risk-based corrective action alternatives, and federal or state issued "comfort" or no further action letters for the site or portions of the site. Additionally, as a result of "smart growth" initiatives and other programs designed to minimize "Greenfield" development and promote land re-use, there are greater financial benefits associated with site contaminated redevelopment. Sites are being redeveloped for community use, residential housing, commercial and industrial development, conservation purposes, and historical preservation.
Such redevelopment requires the cooperation of the remediation contractor selected to perform the clean-up activities at the site, along with the developer, institutional investor, business investors, local governments, and regulatory authorities. This redevelopment is often the first step to re-infusing economic value in a community, and is an opportunity to create tax revenue and jobs.
There are those who are not seeking financial benefits or protections from these transactions, but do want assurances that environmental safeguards are in place over the course of the clean-up process. These can include public interest groups, local or state natural conservation groups, environmental citizen groups, and local residents.
The WCD Group
To understand what makes WCD-CAP unique we need to reflect on the WCD Group of Companies. WCD Group is a New Jersey based private enterprise, comprised of several wholly owned businesses specializing in various aspects of the environmental industry. WCD Group is the parent organization to individual companies operating nationally in the environmental claims, environmental consulting, remediation and construction management, and property development areas. WCD Group's companies are prepared to tackle the most challenging assignments in virtually all environmental categories, from emergency response, environmental risk assessment, remediation management, claims analysis, and litigation support, to redevelopment of contaminated properties. WCD has firmly established itself as a "trusted advisor" to some of the largest legal, insurance, development, and construction entities in the United States. While most developers outsource and retain engineers and environmental professionals, WCD-CAP performs all of the work internally through its affiliated companies: primarily WCD Consultants and WCD Construction Management. By utilizing these internal resources, WCD-CAP is able to quickly evaluate opportunities and capitalize on the expertise of the regulatory relationships.
