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Tuesday, April 30, 2013

Green Infrastructure Boosts Property Values

New UWM study indicates that stormwater management features have economic benefits

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Preliminary results conducted by a UW-Milwaukee researcher show that “green infrastructure” has boosted property values in Milwaukee.

According to researcher Kate Madison, a policy analyst for the UW-Milwaukee Center for Economic Development, green features added to developments in the Menomonee Valley, the Pabst Brewery site and the Lincoln Creek area have reaped financial benefits for those properties as well as local taxing authorities.

The green infrastructure features Madison studied were those that manage stormwater runoff, such as greenways, rain gardens, wetlands, bioretention facilities, porous pavement and other landscaping elements.

The Metropolitan Milwaukee Sewerage District’s (MMSD) new wastewater permit from the state Department of Natural Resources (DNR) requires it to add at least 1 million gallons of this kind of water-retaining green storage capacity for each of the five years of the permit. This permit, the first of its kind in the nation, will help to prevent stormwater from overwhelming the sewer system and the Deep Tunnel during heavy storms, as well as minimizing the amount of polluted runoff that gets into area waterways.

Madison’s study indicates that in addition to improving the environment, green features have a positive impact on property values and the tax base.

Madison released her preliminary results last Thursday at the ninth annual Clean Rivers, Clean Lake Conference, organized by the Southeastern Wisconsin Watersheds Trust (Sweet Water).

Her study was conducted at the request of the Environmental Protection Agency (EPA), which had asked that MMSD calculate the financial impact of its green infrastructure projects.

“Green infrastructure is a relatively new form of infrastructure and we don’t have the data,” Madison said.

 

Green Investments Pay Off

Madison and a team of researchers analyzed green features in the Menomonee Valley, the Lincoln Creek area on the city’s northwest side and the redeveloped Pabst Brewery site on the edge of Downtown.

In the Menomonee Valley, Madison found that the assessed property values of the 117 industrial properties there was 5.8% higher than in similar sites that weren’t connected to green infrastructure. That boost added $1.56 million in assessed property value to the city’s tax base just from the industrial sites, but the value of the residential and commercial properties in the valley increased as well.

MMSD’s $835,000 green investment in the Menomonee Valley would be paid off within three years, Madison found.

Madison cautioned that the added value in the valley could be due to the overall revitalization of the area.

But the green infrastructure “was likely very well worth it,” Madison said.

A stronger link between increased property values and green improvements could be found in the Lincoln Creek area, which was prone to flooding and sewer backups. MMSD invested almost $11 million in green infrastructure as part of a larger revitalization of the creek. As a result, the assessed property value of homes located within two blocks of the rehabbed creek was 20.4% higher than similar properties that didn’t benefit from green infrastructure. While MMSD won’t see its investment paid back for roughly 62 years, Madison said the environmental and economic benefits of a restored Lincoln Creek could be felt far beyond the immediate area.

“This area was an economically depressed area,” Madison said. “To have something like this happen is quite phenomenal.”

Likewise, the stormwater management features incorporated into the Zilber Ltd.-developed Brewery site will also add to its value. While the U.S. Green Building Council has certified the entire project as Leadership in Energy and Environmental Design (LEED) platinum—one of only three neighborhoods in the country with such a high environmental rating—Madison found that the stormwater-related features in the 28 Brewery buildings raised property values 11.4% over similar areas of the city. MMSD’s $1.04 million investment in the development would be paid off in roughly 17 years, Madison found.

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