On my third day with Regency, I accompanied their project manager to a number of development sites, and we discussed some of the challenges he frequently encounters with developments. In one of his most recent projects, Midtown East, he encountered a number of serious unforeseen issues once construction had already started, all of which were challenging because they required involvement from the Department of Environment and Natural Resources. The first issue he encountered was the soil on the site was actually semi-toxic because there had been chemical pollution from a computer chip plant that had been there almost twenty years prior. The solution for this issue was to literally “get new dirt” which ended up costing nearly two million dollars, which was unforeseen. The second major issue encountered on this project was a culvert that ran underneath the site, which guided rainwater runoff into Crabtree Creek about half of a mile down the road. The culvert was far too small to handle all of the additional runoff from the new shopping center, so it had to be replaced, which made it into a City of Raleigh problem, but interestingly enough, the Regency was required to pay for it. The third issue with encountered with this development was the location of the retention pond for runoff. There wasn’t enough space for a traditional retention pond so they had to put it beneath the massive parking deck they were building. Ultimately, the project manager told me that the single most important part of big developments is allocated a decent chunk of money in the budget to unforeseen issues; it’s a win-win situation, because if it gets used you are on budget but if you don’t encounter any issues, you don’t have to spend it, and you are under budget.
