Valuation of Investment Interests in Contaminated Properties in Romania
Introduction
producing effective legislation or development framework, while the know-how and knowledge is being developed in a slow pace; more importantly, it is the European legislation and international literature, guidance and practices which appear to offer significant information about this; in addition to all of these there is the lack of experience in this field. With not much research being done so far, there is definitely a lot of work to be carried out. Finally, availability of sources of finance from the European Union for the countries with the lowest GDPs such as Romania provides an additional incentive and increases the investments interest and opportunities. There are two programmes currently running in Romania for 2007-2013: the Environmental Sectoral Operational Programme (ESOP) and the Regional Operational Programme (ROP), both funded by the European Regional Development Fund (ERDF), (Simule et al., 2010). In conclusion there seems to be interest in brownfield redevelopment; however, unless financial viability exists with acceptable rates of return, the investors/developers will decide whether or not to take the risks associated with contamination. In order to be financial viable, a project must be carefully assessed and the start for this is a valuation of the contaminated property. Prior to decision making and investor must therefore analyse if the project could offer the desired target rate of return. However, it is a challenge to produce this type of valuation and to carry out accurate risk assessments. Hence, the significance of the study for a field which is yet in its beginnings is indisputable from the perspective of both developers and investors and Romanian government.
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