Page 110 - Beyond Decommissioning

Relevant factors for redevelopment 91

retail, commercial, and other centers. The second category is linked with site design
elements and includes creating walkable areas; providing a wide range of housing
options; and providing open and green spaces. The methodology adopted by this study
makes use of points for each relevant parameter, which are then combined to provide
scores.
From the facility owner’s standpoint, the analysis may demonstrate that site rede-
velopment will not provide adequate remuneration over the investment necessary to
make the site palatable to a new owner or tenants. From a broader standpoint, the ben-
efits of reuse may be very large but mostly accrue to the community, which would take
advantage from retention of jobs and constant or even higher tax revenues. If so, the
facility owner may have to negotiate grants, payments or “in kind” assistance from the
local or national government in return for a commitment to get the decommissioned
site ready for redevelopment.

5.1 The economics

In the modern world of business, it is useless to be a creative original thinker unless
you can also sell what you create. Management cannot be expected to recognize a
good idea unless it is presented to them by a good salesman.
David M. Ogilvy (1911–1999)

In general, the decisive factor in the decision to adapt an industrial building is the
cost, regardless the owner, whether private or public. Unless the goal is historic res-
toration of a priceless landmark (when restoration will inevitably cost more than a new
building but public institutions are likely to pay the bill), then adaptive reuse must be
the more cost-effective option, or demolition and rebuilding will prevail.
The business case for adaptive reuse over a demolition and new build process can
be in favor of adaptive reuse. However, initial design and consultant costs may be
higher for adaptive reuse projects to account for higher complexity and research often
required in innovative solutions to de facto constraints and regulatory requirements
(Office for Design + Architecture South Australia, 2014). On the other hand, there
can be many cost advantages to reusing an older structure, such as lower establishment
costs. Further, little or no demolition is required, land acquisition is often less expen-
sive, and most of the needed utilities and services are already there and may only need
upgrading. Also, there are additional savings resulting from the building being already
in place (i.e., materials and related construction costs have already been accounted
for). In some countries another financial benefit of adaptive reuse projects is tax
credits (if the project is recognized as historic in nature) (Buildings, 2008). Moreover,
interior conversions are generally shielded from bad weather by the existing building
structure; by contrast, bad weather may delay the construction of new buildings, which
will cause extra costs.
The relative costs, related benefits, and drawbacks of reuse versus demolition and
new build have been widely debated for decades. Some researchers have stated that
the costs of reusing buildings are lower than the equivalent costs of demolition: