I've been with my present employer for 11 years, and prior to that, with a DC environmental consulting firm. In that time, I can honestly say that I've never gotten choked up at an office holiday party.

Until now.

Last night our CEO was announcing the winners of our "Superlative Awards" to employees who received the most votes from all of us in a variety of categories. With each name called, the honored employee dutifully went up, took their Oscar-like trophy, shook hands with the CEO and sat down.

Things changed when the "Most Likely to Help a Colleague" award was announced. The recipient, an account executive named Noel Roman, shocked us all when he wrapped his 6 foot-plus frame around our CEO to embrace him enthusiastically with both arms. Noel said a few kind words and sat down.

It was when Noel's name was called for a second award that he brought the room to a standstill. This was the big one, the final one of the evening...our company's "MVP."

Noel repeated the hug, and then paused in front of us. He looked at the ceiling for what seemed like a long while. The room fell silent. The side conversations stopped. We all looked at him expectantly. Then he looked back at all of us and spoke in a voice that was ever-so-slightly cracking with emotion.

What he said went something like this: 

"We all come to work together to the same place for the same reason. It's all of us together, working to strengthen the company together. So, I feel like I am accepting this award for everyone here."

In one fell swoop, he changed the tone of the whole event. He was honored. He was humbled. And, best of all, he reminded us all why we do what we do every day.

Noel is one of those unique individuals who brings enthusiasm to his work every single day. But it goes way beyond that. He was the only one to offer help to one of my colleagues as she struggled moving heavy boxes a few months ago. He was among the first to volunteer his time to take the 6-week Due Diligence University Course in October because he knew that it would help him do his job even better. Last year he was among a small group specially selected by an executive committee to participate in the company's first internal mentoring program. A few years back, a team of us trained for the New Haven Labor Day 20K road race, and even though he didn't feel adequately trained by the time race day arrived, he had committed to it, drove an hour at 7am, showed up with his characteristically upbeat smile, and completed a tough race. He's always there with a pleasant attitude, always interested in more than just "how's it going?"

These attributes are not ones that are learned in company training. They're inherent and unfortunately, all too rare.

Last night, Noel raised the camaraderie quotient of our holiday party ten-fold. I thought about what he said during my entire 40-minute drive home. It felt particularly meaningful coming at the end of a pretty tough year in an industry heavy with uncertainty about the present--and anxiety about next year. As someone else said, "I haven't felt a warm feeling like that in a long time." Nor have I.

I hope all of you have a "Noel" in your midst. If not, I hope you get one.

Happy holidays

I wrote a blog at the end of the summer about the bankruptcies of GM and Chrysler. In it, I wondered about the fate of the contaminated sites left behind as these companies filed for Chapter 11 protection. Some of these sites span thousands of acres and have a long list of acronyms characterizing their contamination. In today's market when a buyer can get commercial real estate for a song (assuming they have their own cash, of course), why would anyone touch these properties and risk liability exposure? 

I got the answer to some of my questions from the Wall Street Journal today. Who knew there was an "auto communities recovery czar" tasked with helping communities in struggling auto states cut through the red tape and bring contaminated sites back into reuse? His name's Edward Montgomery and he was brought into Flint, MI to make magic happen when concerns about high cleanup costs stalled the redevelopment of an abandoned auto factory there. His solution was to carve out the part of the 700-acre site with the worst contamination and clear the rest for potential sale to investors. The problem, he said, is "you have this big site right in the middle of your city, and it becomes an symbol of failure when it used to be a symbol of success." By his account, GM and Chrysler have about 110 brownfield properties on their list of assets for sale. If he's as good as they say about getting deals that would've taken years done in months, it could set a new standard for site cleanup. Since I wrote that blog, a swath of old chemical plants and refineries in Delaware became the latest victims of the recession.

On top of these mammoth manufacturing facilities, there are literally thousands of inactive auto dealerships across the country. Last week I had the pleasure of catching up with Neil Chandler at Golder Associates (Mt. Laurel, NJ), a due diligence professional I've known for many years, who reached out after my GM/Chrysler blog. For the past 15 years, Neil's been working with one of the big three auto manufacturers, and now manages their dealership program doing Phase Is, Phase IIs and other types of environmental work on their dealership properties. He attended our workshop last Wednesday in downtown Philadelphia, and bravely and generously agreed to answer a few questions for me on camera after the event about the impact that the recession has had on his work in this area. Watch our interview here.

Companies that manage commercial real estate are increasingly under pressure. Some will completely collapse in this recession, others will be acquired by stronger firms, and still others will be foreced to pare down their number of properties. This adds up to more environmentally stressed sites hitting the market. We can only hope that more experience with these types of transactions will move them along faster and translate into more work for consultants. 

[And special thanks to Neil for fearlessly sharing his thoughts on this topic.]

It seems like there's been a lot in the news about manufactured gas plants. A few weeks back, I posted a "what is this?" pop quiz to see if anyone could identify an MGP in an old photo. Shortly after that, an environmental firm near here issued a PR notice on a project they won to do environmental site assessments and remediation work on old MGP sites in New England, New Jersey and New York. 

Then Monday one of my news feeds on vapor intrusion picked up on a controversy surrounding alleged contamination from a former MGP in Cape May, NJ.

You don't want to be the mayor of Cape May, NJ right now. A utility there is in the process of remediating a former coal gasification plant that operated in town from 1853 to 1937. After cleanup, the utility will relinquish ownership of several properties to the city. The property transfers being done with full indemnity with oversight from the state DEP. The selected cleanup method will involve the installation of a containment wall and monitoring wells around the most contaminated area, with some soil removal.

A few weeks ago, the "nation's foremost expert on former coal gasification sites" made waves by coming out publicly to say that MGPs typically dumped waste in a 4- to 5-block area from the main operation. He went on to note that the town has public housing projects that may have been built on these former dump sites. It didn't help that the local paper also pointed out that the town's planning board turned down a 2006 application from a developer to build condominiums on a site just north of the plant, when the then-mayor noted that there had been health problems in that area for years. There's also a 2003 report on contamination in the "saturated zone" (the footprint of the gas plant), documenting naphthalene detected as high as 6,300 mg/kg.  

It's not surprising that the utility came out refuting the expert's opinion, noting that a comprehensive physical analysis of the former gas plant site and the surrounding areas is in the works, and reassuring the public that proper remediation will be conducted on any areas affected by the operations of the plant. Based on a "thorough review of historical records of the site," the utility does not believe there were any dump sites on properties adjacent to the gas plant.

There's some interesting technical detail in the articles I linked to--worth a look especially if you've done Phase Is on former MGP sites...certainly a lot more technical data than you typically see in local articles. They also provided a mix of Sanborn maps that are being used to identify the location of old structures at the plant site (I put one below).

While this story raises awareness about environmental risks, you have to think it's got everyone in that housing development worried about whether they're living in harm's way.  And just today out of Seattle came a story about a project to build an affordable housing facility that was stalled when developers tested the soil and found the former gas station site was contaminated with 400 times the state cleanup standards for petroleum. The project's now on hold, pending the city undertaking a cleanup that could cost in excess of $1 million.

It's always disturbing to me to read stories about residential developments sited on contaminated sites.  Records of old MGPs, landfills, chemical plants, dry cleaners, gas stations and other environmental red flags are so much more prevalent than they were years ago--and so much easier to get--so the logical expectation is that over time, awareness about site contamination grows and fewer residences are built on hazardous sites. "Fat chance," says the cynic in me who's seen too many stories lately about people finding out the house they're making monthly payments on sits atop a toxic mess.

I do, however, take heart from a conversation I had yesterday with Dan Welby, a colleague of mine who regularly attends conferences for local governments; most recently, the brownfields show in New Orleans.  Municipalities, he said, have come a long way in terms of using environmental data and are getting more comfortable managing the liability of their land holdings. In the past, it was a huge undertaking for a city to map out its contaminated sites or find out what its historical footprint was. It the old days, they'd have to piece together old pdfs of Sanborns. Now it's much easier to map out multiple parcels, overlay historical data and highlight environmental red flags. Conferences for municipalities today typically have tracks to teach city officials how to build inventories of their sites, and a lot of you consultants out there are helping municipal clients do this. The key driver is EPA's brownfields funding. Applying for these dollars is an extremely competitive process. Last year, Dan said there were approximately 800 applications and only a little over 300 got funding. The onus is on a municipality to prove to EPA that they've got brownfields that need to be addressed, and those that do the research have the best chance of getting funding ("If you give us money, we'll clean up this former gas station with hundreds of people at risk around it.").  Those who don't do the research redevelop at their own peril. There are so many stories about cities that developed areas only to find out their mistake years later. One municipality down South undertook a highly-publicized redevelopment project, hit a UST that became a LUST, created a costly problem to fix and created needless embarrassment for the city.

Stories like the one about the Cape May MGP help to make records like Sanborns better understood and could result in them being more widely tapped into by those who play a hand in determining which contaminated sites get redeveloped into what type of uses. The optimist in me hopes that soon there will be no excuse for allowing housing developments to be built on sites with known contamination, but the realist in me knows we have a long way to go.

I just stumbled on a familiar face in an interview featured in the New York Real Estate Journal. Environmental due diligence professional Chuck Merritt is a consultant based on Long Island whom I typically see at industry events a few times a year.

The interview communicates an important point right off the bat: due diligence professionals are really part of the commercial real estate business. Check out the organizations Chuck belongs to: National Realty Club, Mortgage Bankers Association (MBA), U.S. Green Building Council (USGBC) and of course, ASTM.

Asked what he views as the most overlooked opportunity in real estate right now, Chuck answered the move toward green buildings. He feels so strongly about it that he went through the grueling process of earning his LEED Accredited Professional designation.

He also highlighted the changing client mix in the market today and the importance of consultants being aware of who the key players are in their area. I wholeheartedly agree. The clients you served in 2006 and early 2007 probably aren't doing much now...and aren't likely to. So it's critical to track who's looking to invest in commercial real estate next year and position yourselves with them now, hopefully before other consultants do.

"Re-inventing yourself and the services you provide your clients can help you navigate through turbulent times." Well said.

NOTE TO READERS:

I'm off for the holiday festivities. Thanks to all of you for your readership and continued participation in commonground. Enjoy the Thanksgiving holiday!

At our client briefing in Seattle last week, I was reminded not to assume that just because someone does Phase Is, they automatically know what ASTM is. A consultant approached me after my presentation and asked, "What is this ASTM? And what business do they have deciding which Phase Is make the cut or don't make the cut? or telling me how I should do a Phase I?" This blog's for him.

ASTM is a huge international organization dedicated to writing consensus-based standards for just about anything, from the textiles used to make your shirt or car seats to the concrete and steel used in the bridges you drive every day to the wallboard in the walls of your home and office---and a million other goods and services. ASTM's E50 Committee on Environmental Assessment, Risk Management and Corrective Action was formed in 1990 and now has about 1,000 members. They meet twice a year, usually in April and November, with about 70 members attending over three days of technical meetings. The Committee has jurisdiction of over 35 standards that "have and continue to play a preeminent role in all aspects commercial real estate transactions, corrective action, pollution prevention and beneficial use."

Hundreds of consultants, attorneys and users of environmental due diligence volunteer their time to ASTM to collaborate on defining industry standards of practice. These are people who are deeply committed to environmental risk management, many have been in the industry since the "wild West" days prior to the first E 1527 standard. They can debate terms like REC, de minimis and the significance of data gaps until the cows come home. Many can cite every section of E 1527 by heart. I've attended a number of these meetings and they can be as uneventful or exciting as watching golf on TV. Debates crop up that are extremely technical--sometimes heated--and always in the spirit of ensuring that ASTM's standards are current, balanced and consistent.  

The Phase I ESA standard is their most-used standard (E 1527-05). The fact that after months of indepth scrutiny by a regulatory-negotiation committee tasked with writing the federal All Appropriate Inquiries rule, the U.S. EPA recognized E 1527-05 as acceptable protocol for meeting AAI is a tribute to the effort that went into E 1527 by ASTM's members. Since the standard first came out in the early 1990s, it's been revised numerous times in accordance with ASTM's bylaws, which require periodic review of every standard. Every revision is the result of detailed debates at the bi-annual meetings and a balloting process among members. There must also be representation by producers of Phase Is as well as users. This time-tested process of writing standards of practice based on stakeholder input is why ASTM's standards are so widely respected. EPA's AAI committee went through the standard with a fine-toothed comb, tore some sections apart, but then concluded in the end that, although not perfect, there was no better out tool out there for assessing a property for environmental conditions for the purpose of qualifying for CERCLA liability protection. 

Now, E 1527 is approaching another milestone in its evolution. Every eight years, ASTM standards must be reviewed, and then either updated, re-approved without revision or retired. This is the first time since 2005 that the standard is being scrutinized to determine if it still accurately reflects current practice. Are data gaps adequately addressed? recommendations? is the definition of environmental professional sufficient? are there any non-scope issues that should be added? and on and on.

The last meeting just happened in Atlanta last month. If you haven't been involved in ASTM, now's a good time to jump in. Joining is easy, inexpensive, and with minimal efforts, give you the chance to have a voice in the standards you use every day. It's also a good thing to have on your resume, stay current with technical issues and a valuable way to build up some professional visibility. If you want to join or are thinking about joining, there's a nice guy at ASTM I've known for years named Dan Smith who told me today he'd be happy to answer any questions.

I don't get anything out of you joining ASTM, but I do strongly believe in the process behind writing these standards. It's not dissimilar from our political process. I have a brother-in-law who was born in Argentina and for years during the Bush-then Clinton-then Bush years, I had to listen to him rage against the political machine at family dinners. He wasn't a citizen, didn't vote and therefore, in my opinion, didn't have grounds to complain about what he got. I'm proud that he's since taken the test to become a citizen, now doesn't miss a chance to vote and I'll gladly debate with him over Thanksgiving dinner next Thursday. I feel the same way about ASTM. You don't like something in E 1527? Speak up, get involved, vote for/against or forever hold your peace. These standards aren't written in a vacuum and there's an opportunity to have a say in the outcome.

[At the October meeting in Atlanta, groups met on Phase Is, vapor intrusion, a new building energy performance standard and green remediation. For more information on the goings-on, read a summary I just finished after talking to a bunch of members who went down there.]

I've blogged earlier this fall about why I'm not fooled by economic signs that we're at the end of the recession. If you've heard me speak recently, you know that I'm pessimistic about any near-term recovery in commercial real estate. In fact, as a result of my latest slide deck on how bad things are (job losses, property price declines, seller-buyer price disconnect), I was just sarcastically referred to as "Little Miss Real Estate Sunshine" by a client who listens to my quarterly webinars on the state of the market.

I dedicate this blog to him today as I pass along two positive....yes, positive...things that happened in the past week.

1. MIT's Center for Real Estate has an index to track changes in the prices of investment-grade commercial real estate--it's had the slope of a black diamond ski trail since mid-2007. Last week the index increased by 4% in the Jul-Sep quarter--the first uptick in more than a year and the largest since the market downturn began. Analysts have been eagerly searching for signs that prices have hit bottom--this will trigger a flood of workouts, foreclosures and yes, new investment deals by opportunistic buyers who've been planted on the sidelines for too long. Remember that story about Chicken Little proclaiming "the sky is falling!" to anyone who would listen? MIT's index was quickly met with analysts' proclamations that "the bottom is near!" The freefall in prices since 2007 is largely why transaction volume has been bouncing along the bottom in 2009. So, if MIT is truly onto something, it would be good news for sustained growth in transaction volume--not to mention demand for Phase I environmental site assessments. 
2. The second bit of positive news is that we're close to the first commercial mortgage backed securities (CMBS) deal under the fed's Term Asset-Backed Securities Loan Facility (or TALF) program. This is big news. There hasn't been a U.S. CMBS deal in more than a year, and the CMBS market was once a good friend of the Phase I ESA market. CMBS deals fueled the phenomenal growth of commercial real estate leading up to the 2007 collapse by allowing banks to sell loans on Wall Street and lend even more. In an effort to jumpstart the market, TALF was extended to CMBS in June, but there hasn't been one deal yet. This one's been much-anticipated to say the least. To be eligible for TALF funding, the Fed sets a high due diligence bar. It is being extremely conservative with this new deal and diligent in reviewing the property collateral behind it (28 shopping centers in 19 states) before making a decision to let it move forward. The process began way back in June and since then, a number of properties were reportedly dropped for not making the Fed's cut. News of the first CMBS deal under TALF has made the collective market hopeful that it could end the lockdown in the CMBS market and pave the way for other real estate investment trusts (REITs) who need to unload debt and are hoping to take advantage of TALF. There are reportedly a dozen REITs with TALF deals already in the hopper, and you can expect the due diligence on these to be equally tough. 

These two developments could be something. Or they could just be little blips on the screen. I'm nothing if not consistent so I'd encourage you not to hold your breath. Not yet anyway.

Every now and then I use my blog space to bestow a "Strategic Award of the Week" on an individual or firm doing something particularly innovative. In past posts, this award's gone to a consultant who bravely put herself out there in a LinkedIn discussion with positive results, a consultant who got himself placed on a panel of "heavy hitters" at a Manhattan real estate conference, a firm that latched onto a new environmental program in their state and built a timely client alert around it, and an environmental professional who's walking the walk on LEED certification and brownfields redevelopment. It's extremely important to highlight examples like this in a market when due diligence professionals can't do enough to position themselves with prospective clients and use every networking avenue available to build their reputations as technical experts.

I subscribe to dozens of commercial real estate news feeds, and a recent one from Commercial Property Executive proclaimed "CREW Awards 20 Women Under 40." CREW is the Commercial Real Estate Women (CREW) Network. What I didn't expect to see as I scanned the list of names was an environmental due diligence professional. This week's award goes to Elizabeth Krol at Shaw Environmental, one of 20 women CREW selected from more than 120 nominees based on their "established success in the field, commitment to the industry and demonstrated leadership," and someone CREW deems likely to be an "influential leader in the industry." The others were from the legal, investment, development, finance, brokerage, institutional and construction sectors, from such esteemed firms as Grubb & Ellis, Wachovia Real Estate Securities and NorthStar Advisors. In the sprit of full disclosure, I know Elizabeth quite well and have for years, and every time I meet up with her at a conference, I'm left feeling like she could teach me a thing or two about time management.

For those of you who don't know her, she's a Professional Geologist and client program manager for Shaw Environmental Inc. Our industry is constantly evolving into new technical areas, and Elizabeth is a good example of someone who positions herself where the action is. Name a timely environmental due diligence topic (carbon risk, green building due diligence, LEED) and there's a good chance Elizabeth's already on a technical committee that's driving it forward. I get the distinct impression that Elizabeth doesn't wait long to return a client's call, even on nights and weekends. She's also actively involved in programs to mentor and train young environmental professionals at her firm.

I recently caught up with Elizabeth and had the opportunity to ask her a few questions about the award and her own personal networking efforts. As followup, without being asked, she sent me her current curriculum vitae. It's 21 pages long.

Going back in time, how did you first get into the environmental due diligence field?

I completed my MS in Geological Sciences at Lehigh...crossed the Delaware into NJ - a hotbed of environmental activity in early 1990s. Thrilling place to be...so much to do, complex sites, expedited transactions for M&A and asset based lenders in a sophisticated regulatory environment.

How long have you been involved with CREW?

I've been a member of CREW, and the Boston Chapter, NEWIRE (New England Women in Real Estate) since approximately 2003. I had been invited to meetings by a friend at a prominent law firm prior to that time, but it wasn't until I joined a committee and became actively involved that I really got to know other members and maximized the benefits of membership.

What benefits do you see from your involvement with groups like CREW? How important is this award?

It's a tremendous honor from a prestigious national organization more than 8,000 women strong, and to be nominated with such an impressive peer group has been incredibly gratifying. To be selected is truly the icing on the cake!

What other associations do you belong to?

The Environmental Bankers Association, an organization dedicated to training and knowledge sharing among risk management professionals nationwide. I also chair the NE Chapter of the Auditing Roundtable, an organization focused on EHS auditor training and resources to support EHS professionals.

One of the things we've talked about recently is the challenge of finding time to get involved in all the social media outlets coming out of the woodwork...commonground, LinkedIn groups for everything from EP groups, CRE, alumni, and now twitter and Facebook. What's your opinion on these sites and the value they provide in your professional life? How involved are you?

Actively involved...I am a founding advisory panelist for commonground. I love that the community is so focused on the commercial real estate industry and the environmental due diligence arena, in particular. The other social networking options are more social and less technical. There needs to be a place for professionals to communicate about pressing issues during these challenging times. I am also a staunch advocate for quality, and commonground provides a forum to improve quality across a broad user base.

I know you were also heavily involved in the development of Due Diligence University (DDU). Can you say a few words about what you did, what that experience was like and the importance of training in this industry?

I can't say enough about the importance of training. Really, it is a quality and risk management issue. I've always been involved with the development of assessor training programs at the firms I've worked for, and to have a national program available to raise the bar among EPs and aspiring EPs throughout the US and internationally is a huge improvement for our industry with long-term positive ramifications for commercial real estate, legal and financial services companies to be supported by trained EPs. The development of commonground's Environmental Due Diligence 101 course was exciting because we knew we were doing something important for the collective good (which in and of itself is rewarding), but also because we were working with peers from competing firms that we admire and respect...and sometimes have differing opinions. That made for lively discussion and expanded everyone's knowledge. I learned a great deal from the process.

How much training did you have before you did your first Phase I?

I was incredibly fortunate to work for a great firm, Clayton, with a talented management team that valued education, training and professional certifications. My manager was a management professor at Columbia who encouraged me to learn as much as I could, provided tremendous opportunities for advancement and supported the establishment of a Boston office and my pursuit of an MBA. I also greatly benefited from the mentoring of a senior project manager who provided mini-tutorials on various industries before we conducted a site visit. He would review the current and historic site use, and know the area since he'd been working in NJ for several years, and could say, this was a former hat factory so there was likely mercury utilized onsite, for example. Overall, they taught me good client communication skills, as well - call the client from the site with an update and at each stage of the assessment process with new developments and/or new information. They availed me of project management opportunities for two key clients, one a lender, one a manufacturer, which broadened my experience exponentially.

What advice do you have for young environmental professionals just breaking into the field?

Ask lots of questions...honestly...your manager would rather that you asked than assumed or didn't take action. Once you have the direction needed, take action! Always push a project forward whenever you can. Time is of the essence in a transaction, so ideally, the project needs to be moving forward, toward a successful resolution for the client, as efficiently as possible. Be proactive.

Always say thank you - especially to your clients, managers and mentors. There is a dearth of good manners in the new economy due to stress and budget constraints. Be polite and it will be appreciated.

Over the course of several projects, we coined a phrase with one of our key real estate clients: "Communicate....early and often!" Focus, teamwork and good manners make all the difference.

Closing thoughts:

The reason I chose Elizabeth for a Smart Strategy of the Week Award is because it's a great example of an environmental professional being honored not by an environmental association, but by the broader commercial real estate sector. It is extremely smart for environmental consultants to get as involved as they can in their local real estate market, and join associations where prospective clients go to stay abreast of technical issues. 

In the toughest economy we've seen in years, Elizabeth is on her game. Are you?