International Transaction Overview

Date of Investment	May 2001
Transaction Size	$6.3 Million
Estimated Remediation and Insurance Costs	$1.3 Million
Type of Assets	Former Manufacturing Facility
Total Raw-acreage	44-acres
Location	Cranleigh, United Kingdom

Transaction Background

An acquisition of 44-acres of land and a brick manufacturing plant located in Cranleigh, a village 30 miles south of London, England, in May 2001. The 44-acre property includes approximately 32-acres of undeveloped land that are free of contamination and well suited for residential development. The remaining 12-acres (where the brick plant is located), have a long history of industrial use that includes munitions storage, chemical manufacturing and brick production. The plan is to achieve residential zoning entitlements in exchange for a commitment to remediate the site and then subdivide the property and sell it to residential builders.

Environmental

Chemical manufacturing at the site, which ended in 1989, resulted in zinc, cadmium, lead and copper contamination in the soil and, more importantly, in surface water runoff. The soil contamination itself is not a major problem, but because it is on the surface, it runs off into a tributary of the Thames River. The remediation plan includes containing the contamination within a clay-lined portion of the site, adjacent to and part of the brick operations in the future. This area will be capped with clay to prevent continued surface water contamination. Our client purchased remediation stop loss and property transfer liability environmental insurance on this asset.

Transaction Highlights

• This is an important transaction to United Kingdom regulatory and planning officials in that it allows them to claim success for remediating a contaminated site as a result of recently enacted environmental liability laws.