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Industrial Property Closure & Divestiture

Practices

Industrial Property Closure & Divestiture

We assist clients in cost-effectively mitigating the risks associated with the closure and transfer of former industrial properties that are or may be contaminated. The risks related to transferring such properties can include environmental issues stemming from past property uses that may be discovered during the buyer’s due diligence (which make contract negotiations more complex) or after the sale (which may lead to indemnity, cost recovery, or toxic tort claims). We provide guidance on developing and implementing corporate programs for closing, decommissioning, remediating, and selling former industrial facilities where strategic decision-making is critical to conducting successful transactions and reducing liability risks.

A company closing a former industrial facility has a number of options, including:

  • Mothballing the property to delay addressing environmental cleanup costs.
  • Allowing a prospective purchaser to conduct (or choose not to conduct) its own environmental due diligence and address the issues as they arise.
  • Preparing the property for sale by conducting its own investigation and potential cleanup (which may be conducted under mandatory or voluntary programs).

We have helped businesses of all sizes across the country – from small family-owned enterprises to international companies – close, decommission, remediate, and sell former industrial properties. Our experience encompasses addressing issues related to unique state laws, such as the former Connecticut Transfer Act, New Jersey Industrial Site Recovery Act, and Ohio Cessation of Regulated Operations law.

Examples of our experience include:

  • Advising an international manufacturing company on its plant consolidation program, which has resulted in the closing, remediation, and sale of numerous facilities across the country.
  • Assisting companies in developing structured, proactive programs that are used whenever a plant is closed and may be transferred. These programs help maximize the sale price for such properties (and eliminate carrying costs), but the primary benefit often is the management of long-term liability risk through cost-effective investigations and cleanups, appropriate contract language, and risk transfer.
  • Advising a manufacturing company on the closure and sale of properties in Iowa, South Dakota, Texas, Indiana, and Delaware.
  • Advising an owner of a 100-year-old foundry business regarding the closure of the business and sale of the real property. The client decided to proactively investigate and remediate the property, resulting in the sale of the property at an attractive price.
  • Representing clients in numerous cleanup projects across the United States under state mandatory and voluntary programs in connection with property transfers, including:
    • Cleanups under the Ohio Voluntary Action Program
    • Significant cleanups of manufacturing properties in New Jersey under the Industrial Site Recovery Act
    • Cleanup of chlorinated solvents in groundwater plume migrating from a California site
    • An extensive investigation and cleanup under the Connecticut Transfer Act
    • Remediation of a property under the Iowa Land Recycling Program
    • Cleanup of PCB-contaminated soil under the Michigan Part 201 cleanup program
    • Cleanup of a contaminated property in Massachusetts involving a fixed-price contract with the remediation contractor backed up by a cost-cap insurance policy