Navigating the Complexities of Advanced Manufacturing Site Selection

As manufacturing investment continues to gain momentum, each new project consumes available industrial real estate. This trend has led to a scarcity of “plug-and-play” second-generation facilities and shovel-ready parcels. Advanced manufacturers now face the challenge of conducting complex, multi-faceted analyses that account for their specific operational needs, risk profile, and long-term strategic goals. The outcome often boils down to a choice between brownfield and greenfield sites—a decision more nuanced than it initially appears. Selecting the appropriate option can set the stage for sustained operational success, while an ill-suited choice may expose the manufacturer to unexpected expenses and risks.

Defining the basics: Brownfield vs. Greenfield

In the industrial real estate sector, the terms “brownfield” and “greenfield” can create confusion due to differing interpretations. Generally, a brownfield site refers to a second-generation property with existing infrastructure. From an environmental perspective, "brownfield" typically suggests some degree of contamination resulting from the site's previous use. However, not all brownfields have environmental issues. This distinction is important to note, as the term's interpretation can vary depending on the context and the specific expertise of the professionals involved in a project. Conversely, a greenfield site describes undeveloped land, often seen as an ideal blank canvas for building new facilities from the ground up. Understanding these nuances clearly is essential for effective decision-making and successful communication among stakeholders involved in site selection.

Cost and timing considerations

Initial capital expenses and project timelines differ substantially between greenfield and brownfield sites. Greenfield developments typically involve significant upfront investment for new infrastructure such as concrete, earthworks, steel, and roofing. Conversely, brownfield sites generally reduce these initial costs, as structural components often already exist and are passed through in the real estate costs. However, brownfield sites may still require considerable modifications depending on specific operational requirements. Permitting requirements for machinery installation may vary by location. With a greenfield facility, long lead times for power or mechanical equipment have generally improved and may not be a problem; however, highly specialized equipment may still present long lead times of more than one year.

Cost and timeline comparison

Operational and infrastructure considerations

Site selection extends beyond cost and timeline into specific operational considerations. Greenfield sites allow for comprehensive customization, enabling manufacturers to design facilities precisely suited to their processes. However, such sites often require substantial infrastructure development—roads, utilities, and transportation networks—which may delay operational readiness.

Conversely, brownfield sites typically offer existing utility infrastructure and established transportation links, facilitating faster operational readiness. Nevertheless, they may present challenges such as structural limitations or restrictions on equipment placement, potentially requiring extensive renovation.

Operational factors

Navigating hidden risks and strategic challenges

Every site has potential hidden risks. Greenfield sites, while initially promising fewer unknowns, may face unexpected hurdles in infrastructure development and permitting processes, which can substantially delay projects. Brownfield sites, on the other hand, often carry risks related to undiscovered contamination, outdated infrastructure, or regulatory restrictions associated with redevelopment.

Hidden risks and challenges

Strategic flexibility and long-term growth potential

Manufacturers increasingly recognize the importance of strategic flexibility, community acceptance, and long-term scalability in their site selection processes. While greenfield sites typically offer excellent potential for future expansion and fewer neighbor conflicts, brownfield sites may face more significant limitations regarding space for growth or future modifications.

Strategic and long-term considerations

The “Spec-to-Suit” alternative: A balanced option

In some cases, a spec-to-suit option may be a common middle ground. A spec-to-suit is a real estate development strategy that blends aspects of speculative (spec) building and build-to-suit construction. In many cases, this is a newly developed, first-generation building delivered in shell condition, where there is flexibility with the owner to make major adjustments. Manufacturers that pursue this route often benefit from the entitlement and infrastructure work completed as an industrial development while having design influence on major site features. Often, the building can be modified to accommodate manufacturers’ requirements, such as a thicker slab, converting dock doors to glass windows or knock-out panels, or adjusting the office specifications. This route offering cost savings akin to brownfield and customization similar togreenfield developments.

Preconstruction planning: Essential for risk mitigation

Engaging a preconstruction advisor to assist the project team in site selection, facility planning, and construction planning ensures the team remains well-organized and informed throughout the process. The preconstruction advisor works on behalf of the organization, managing the decision team and assessing properties for suitability, while providing cost and schedule analysis for each property under consideration. Furthermore, the advisor collaborates with the project team to initiate preliminary design and procurement efforts during the site selection process, ensuring a swift start to the work as the real estate transaction concludes. The procurement process alone for significant work can require 6-10 weeks or more to ensure complete, competitive bidding and sourcing. It is highly advisable to involve a preconstruction advisor during the site selection phase to facilitate a smooth and efficient transition to the build phase. 

Conclusion: Strategic resilience over short-term cost

While the predominant choice between greenfield and brownfield manufacturing sites is a balance between timing and cost considerations; today’s successful manufacturers embrace a strategic-multidimensional approach. They—consider operational demands, hidden risks, community integration, and future adaptability alongside traditional cost factors. In an increasingly uncertain and volatile global industrial environment, the most resilient companies will prioritize site selections that position them for sustained operational flexibility, market responsiveness, and long-term competitiveness.

Greenfield Construction (New Build on Bare Land) vs  Brownfield Fit Out of Existing Facility

1. A manufacturer’s machinery can have a dramatic effect on the cost of the work. Large, heavy equipment with high utility demands will increase costs in MEP and structural categories.

2. With brownfield facilities, occasionally, small expansions of the existing facility may be necessary for special processes or unique storage areas.

3. Test Fit planning in brownfield facilities is extremely important. Preliminary layouts are highly encouraged, as well as spatial planning to ensure property selection is suitable.