Real estate development must plan for and around natural disasters. Over the long duration of planning, construction, and sales, nature will have a say about a project. Where I work in Northern Nevada and Northern California the three primary types of disasters that are considered and planned for are wildland fire, floods, and earthquakes.
There is nowhere in this country that does not require an accounting for natural disasters and climate change is elevating the amount of discourse, research, and mitigation measures required as we plan. Thankfully, we have science on our side in way that I don’t think developers did for most of the 20th century. Drought in Las Vegas, tornadoes in Dallas, flooding in Chicago, hurricanes in Florida, and blizzards in NYC are all regular phenomena and must be part of our learning as we move ahead.
One great positive about real estate development today is that we have a variety of experts to aid in understanding natural conditions and disaster planning when it comes to land planning and construction. The California Environmental Quality Act (CEQA) governs the preparation of a very thorough analysis of the environmental impacts of a new development in a region. CEQA is a bit of a cottage industry in California. Certain consulting firms can make their living creating the voluminous and detailed reports. Certain attorneys can make a career out of arguing about the scope and meaning of the requirements.
How many cars will use an intersection at build-out and what does that mean to air quality? Will new lighting from development negatively impact migratory bird behaviors? Are there any rare or threatened plant species for which the site is critical? Will a 100-year flood wash it all away? CEQA calls for the creation of an Environmental Impact Report (EIR) which answers all these questions for local planning authorities to consider when reviewing a project.
Where I grew up in the suburbs of Chicago it seemed that almost every spring the Des Plaines River would come out of its banks and flood the homes nearby. There was some good modern planning around leaving flood plain as open space, parks, and playing fields when I lived there but too many homes had previously been built in the river’s path. One of my key lessons in life is don’t live in a flood plain unless you want to be in a situation where volunteer high school football players filling sandbags will determine the fate of your property.
In the West flash floods are more the issue vs. the slow-moving behemoths that occur in the Midwest. But even downtown Reno floods when there is simply too much water flowing out of the Sierra Nevada for the creek beds and river beds to hold. Of course, humans haven’t helped as we converted urban river corridors to concrete chutes that allow little room to flex, but we’re learning.
We’re in a better place than ever when it comes to studying land uses, but the problem is not going away. Real estate development will always require some compromises as we move forward, but new projects and housing can’t be expected to fully remediate the sins of the past.
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Ed Morgan Real Estate Fundamentals 