The Impact of Contamination on the Canton/ Southeast Baltimore Land Market

Abstract

Data from one industrial district in Baltimore can show the impact of contamination on demand for and supply of industrial land. A survey that covered 69% of the land in Canton/ Southeast Baltimore found that land purchases and redevelopment are occurring on the area's largest parcels when sellers are willing to lower their prices to compensate for the risks and costs associated with owning a site with a history of contamination. Brownfield sites sold for an average of 55% of the average price per acre of clean sites, and those that sold had an average sale price of 25% of the average price per acre of contaminated sites that did not sell. We found little evidence of land hoarding by the private sector. Surprisingly, the City of Baltimore appears to be more reluctant to redevelop contaminated parcels than does the private sector. We conclude that documented land contamination is not deterring buyers from purchasing land in the area. This analysis was conducted prior to the passage of Maryland's 1997 Voluntary Cleanup Act, which limits an owner's legal liability for future remediation costs once an agreed upon standard of cleanup has been met.