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The Bamboom: A Fast-Growing Grass Has Investors Seeing Green

Bamboo is renowned for being the fastest growing plant in the world.  Its status as an environmentally friendly raw material – a more sustainable alternative to wood, pulp, and traditional textiles – is growing almost as quickly.  Bamboo’s ascendancy is even reflected in the IPO market: we can find five initial public offering registrations by companies for whom bamboo is an important if not central product.  All five have been filed since the middle of 2010.  The newest came in earlier today, in the form of an F-1 filed by Dragon Bright Mintai Botanical Technology (Cayman) Ltd.  The extravagantly named Hong Kong-based startup seeks to get into the business of bamboo “forestry” to meet the rising world demand for this woody grass.

Photo by Joi. Some rights reserved.

Dragon Bright does not go out of its way to market itself as an ecologically conscious company.  But on that score it is the exception among its fellow bamboo-focused registrants.  A recent case in point is Sugarmade, Inc. (S-1, 8/4/2011), a distributor of non-wood paper products.  Wearing its eco-passion on its (green) sleeve, the company declares that its use of such “earth friendly sources” as sugar cane and bamboo instead of wood “significantly reduces its manufacturing carbon footprint, energy consumption, and attendant water pollution . . . .”   Similar rhetoric is found in the filings of Biopower Operations Corp. (S-1, 2/9/2011; closed in August), which aims to use bamboo pulp as a biomass energy source; Artison Investments, Ltd. (S-1, 9/10/2010) , developing a composite building material made from bamboo; and Asia Green Agriculture (S-1, 9/20/2010; closed in July), cultivating organic bamboo shoots for the dinner table.

Perhaps even more illuminating is how other already-public companies have reinvented themselves to jump on the bamboo bandwagon.  In some cases, these transformations run a predictable course: for example, a company called Hemptown Clothing Inc. changed its name to Naturally Advanced Technologies Inc. and began supplementing its hemp-based textile offerings with other eco-friendly fibers like bamboo.  But in many other cases, the switch to bamboo seems to come out of left field.  Ivany Nguyen, Inc. (which grows bamboo for paper pulp) and Clenergy Inc. (bamboo for biomass energy generation) both began their corporate lives as mining companies.  And then there is One BIO Corp., whose business now includes the production of bamboo-based organic food products and fertilizers.  Long before it became focused on the growth of this versatile member of the grass family, back when it was still called Contracted Services, Inc., the company was invested in keeping grass short.  It offered commercial lawn mowing services.

Why Derelict Government Buildings are Like Brownfields, Why that Matters, and Why Paintballers are Paying Attention

Here’s a follow-up on last week’s “Don’t Forget to Turn Off the Lights Before You Leave,” our post about President Obama’s June 2010 directive to the federal government to dispose of unneeded and underutilized property — and about the GAO’s subsequent Testimony, released last week, reporting that the process was hitting a lot of speed bumps.

As the Presidential Memo has it, the disposal of property offers both economic and environmental benefits: the program’s primary hoped-for outcomes are to “eliminate wasteful spending of taxpayer dollars, save energy and water, and further reduce greenhouse gas pollution.” That is, the focus is on the unnecessary consumption of resources.  But I would argue that there is another, perhaps even more important, environmental angle.

Photo by SomeDriftwood. Some rights reserved.

That angle is brought to light when we compare the government building situation to the EPA’s program on brownfields.  A “brownfield” is likewise a property that is in disuse or disrepair — the “expansion, redevelopment, or reuse of which may be complicated by the presence or potential presence of a hazardous substance, pollutant, or contaminant.”  (See our October 22 post on the topic.) The EPA’s program is designed to “help revitalize former industrial and commercial sites, turning them from problem properties to productive community use.”

The point isn’t merely that brownfields and neglected government buildings are similar. It’s that the way the EPA frames the problem of brownfields is applicable to both. As the EPA says about brownfields, “Cleaning up and reinvesting in these properties increases local tax bases, facilitates job growth, utilizes existing infrastructure, takes development pressures off of undeveloped, open land, and both improves and protects the environment.”

In other words, brownfields aren’t just bad because they’re eyesores or may be a source of toxicity. They’re also bad because they adversely affect the communities in which they take up physical and psychic space. They contribute to urban blight, and thus to urban (and suburban) sprawl. They are a drag on the larger project of rehabilitating distressed communities.  This is not merely an environmental issue; it is an issue of environmental justice.

Here is how EPA administrator Stephen L. Johnson described the brownfields project at a conference a few years ago:

[L]ast year I visited an inner city neighborhood. And I saw first-hand, that through the work of community leaders, where once stood abandoned buildings and derelict lots, now there is an urban oasis. By replacing plots of rubble with grass and trees, this community is turning urban blight into urban pride, reducing the environmental effects of stormwater runoff, and keeping rainwater out of the city’s overtaxed sewer system.

And just as we see with Brownfields reclamation, advances in the urban environment have led to advances in the urban economy. Through this collaboration, property values have increased by as much as 30 percent. Who would have thought that a little grass could produce such results?

For those of us with front and back yards, a patch of grass might not seem like a big deal. But when I was visiting that neighborhood, I noticed two young girls who were riding their bikes around one of the rehabilitated lots. Where there was once a plot littered with abandoned cars and trash, there is now safe, grassy land for the children of that community to play.

Now, it’s true that vacant and aging government buildings may not be a blight in the same way as plots of land “littered with abandoned cars and trash.”  Yet what that distinction misses is that both spaces have the potential to be transformed into positive, beneficial places.

And that brings up a final, crucial point.  Even if the government does succeed in “disposing” of many of these properties, a happy outcome along the lines of what Stephen Johnson describes above is not a foregone conclusion. Interestingly, one of the few blogs to comment on the recent GAO report is 68caliber.com — which represents, of all interests, paintballers.  This “just might prove to be potential value to paintball businesses,” the blogger writes, in regard to the possibility of some prime real estate opening up.  That’s not (necessarily) to suggest that having paintball centers in urban areas would be a detriment, environmental or otherwise.  But it is a reminder that how these derelict buildings are reinvented could be just as important as whether they are reinvented.

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