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What are the effects of contamination risks on commercial and industrial properties? evidence from Baltimore, Maryland

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  • Alberto Longo
  • Anna Alberini

Abstract

Using the hedonic pricing approach, this paper investigates how the information released on public registries of contaminated and potentially contaminated sites affects nearby commercial and industrial properties in Baltimore, Maryland. The study found that industrial properties are virtually unaffected by proximity to a site with a history of contamination, while commercial properties do suffer an external cost due to the proximity to a contaminated site. This external cost is not cleared once the site has been cleaned up or has been pronounced to be harmless. It also found that the impacts of urban economic development policies, such as Empowerment Zones and Enterprise Zones, have had positive effects on industrial property values, but less so on commercial properties. In sum, brownfield properties in Baltimore are not particularly attractive investments for developers, and there is little potential for self-sustaining clean-up based on appropriate fiscal incentives, such as Tax Increment Financing. It is doubtful that 'one size fits all' measures to encourage the clean-up of contaminated sites can be successful in this context.

Suggested Citation

  • Alberto Longo & Anna Alberini, 2006. "What are the effects of contamination risks on commercial and industrial properties? evidence from Baltimore, Maryland," Journal of Environmental Planning and Management, Taylor & Francis Journals, vol. 49(5), pages 713-737.
    • Handle: RePEc:taf:jenpmg:v:49:y:2006:i:5:p:713-737
    DOI: 10.1080/09640560600850028
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    1. Lovell, Sabrina J. & Lynch, Lori, 2002. "Hedonic Price Analysis Of Easement Payments In Agricultural Land Preservation Programs," Working Papers 28564, University of Maryland, Department of Agricultural and Resource Economics.
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    Cited by:

    1. Longo, Alberto & Hutchinson, W. George & Hunter, Ruth F. & Tully, Mark A. & Kee, Frank, 2015. "Demand response to improved walking infrastructure: A study into the economics of walking and health behaviour change," Social Science & Medicine, Elsevier, vol. 143(C), pages 107-116.
    2. Joaquin Ameller & Jean-Daniel Rinaudo & Corinne Merly, 2020. "The contribution of economic science to brownfield redevelopment: a review," Post-Print hal-02532209, HAL.
    3. Peter M. Schwarz & Gwendolyn L. Gill & Alex Hanning & Caleb A. Cox, 2017. "Estimating The Effects Of Brownfields And Brownfield Remediation On Property Values In A New South City," Contemporary Economic Policy, Western Economic Association International, vol. 35(1), pages 143-164, January.
    4. Anna Alberini, 2007. "Determinants And Effects On Property Values Of Participation In Voluntary Cleanup Programs: The Case Of Colorado," Contemporary Economic Policy, Western Economic Association International, vol. 25(3), pages 415-432, July.
    5. Alberto Longo & Danny Campbell, 2017. "The Determinants of Brownfields Redevelopment in England," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 67(2), pages 261-283, June.
    6. Doron Lavee & Tomer Ash & Gilat Baniad, 2012. "Cost‐benefit analysis of soil remediation in Israeli industrial zones," Natural Resources Forum, Blackwell Publishing, vol. 36(4), pages 285-299, November.
    7. Robin R. Jenkins & Elizabeth Kopits & David Simpson, 2006. "Measuring the Social Benefits of EPA Land Cleanup and Reuse Programs," NCEE Working Paper Series 200603, National Center for Environmental Economics, U.S. Environmental Protection Agency, revised Sep 2006.
    8. Stefania Tonin & Margherita Turvani, 2011. "Environmental contamination and industrial real estate market: an application of hedonic price method in Italy," ERSA conference papers ersa10p511, European Regional Science Association.
    9. Ayoung Woo & Sugie Lee, 2016. "Illuminating the impacts of brownfield redevelopments on neighboring housing prices: Case of Cuyahoga County, Ohio in the US," Environment and Planning A, , vol. 48(6), pages 1107-1132, June.
    10. Oana Mihaescu & Rainer Vom Hofe, 2013. "Using Spatial Regression To Estimate Property Tax Discounts From Proximity To Brownfields: A Tool For Local Policy-Making," Journal of Environmental Assessment Policy and Management (JEAPM), World Scientific Publishing Co. Pte. Ltd., vol. 15(01), pages 1-23.
    11. Mihaescu, Oana & vom Hofe, Rainer, 2013. "The Impact of Brownfields on Residential Property Values in Cincinnati, Ohio: A Spatial Hedonic Approach," HUI Working Papers 85, HUI Research.
    12. Douglas Noonan & Douglas Krupka, 2010. "Determinants of historic and cultural landmark designation: why we preserve what we preserve," Journal of Cultural Economics, Springer;The Association for Cultural Economics International, vol. 34(1), pages 1-26, February.
    13. Christopher A. De Sousa & Changshan Wu & Lynne M. Westphal, 2009. "Assessing the Effect of Publicly Assisted Brownfield Redevelopment on Surrounding Property Values," Economic Development Quarterly, , vol. 23(2), pages 95-110, May.
    14. Marie Howland, 2007. "Employment Effects of Brownfield Redevelopment What Do We Know from the Literature?," NCEE Working Paper Series 200701, National Center for Environmental Economics, U.S. Environmental Protection Agency, revised Jan 2007.
    15. John Braden & Xia Feng & DooHwan Won, 2011. "Waste Sites and Property Values: A Meta-Analysis," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 50(2), pages 175-201, October.
    16. Alberini, Anna, 2006. "Determinants and Effects on Property Values of Participation in Voluntary Cleanup Programs: The Case of Colorado," Sustainability Indicators and Environmental Valuation Working Papers 12215, Fondazione Eni Enrico Mattei (FEEM).

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    More about this item

    JEL classification:

    • Q51 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Valuation of Environmental Effects
    • Q53 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Air Pollution; Water Pollution; Noise; Hazardous Waste; Solid Waste; Recycling
    • R33 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Real Estate Markets, Spatial Production Analysis, and Firm Location - - - Nonagricultural and Nonresidential Real Estate Markets

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