Are you considering purchasing or securing an option on some commercial property? Or perhaps refinancing? The Phase 1 site assessment is your new Best Friend, scientifically speaking. These are the conditions under which the assessment is usually performed, and for good reason. You want to know what you’re buying, above and below the surface, so you can make an informed site selection and purchasing decision.
Best-case property presents no environmental risk, or at least a level of risk that will be manageable. Most lenders now require a Phase 1 site assessment before agreeing to fund commercial property loans, further underscoring the value and importance of this basic investigation.
You can also conduct a Phase 1 site assessment just for general interest, if you already own a particular parcel. Maybe you’ve owned the property for a number of years without incident, but you’ve recently heard stories about the “old days” that raise some concerns about what might be lingering out of sight or smell. You’d be smart to investigate.
Phase 1 site assessment can establish you as an “innocent landowner.”
Property owners are legally responsible for maintaining environmentally safe conditions. You can’t afford to run the risk of purchasing something you later learn is contaminated with toxic or otherwise hazardous substances, because remediation costs could easily run into millions of dollars.
The Phase 1 site assessment is designed to ascertain current property conditions before you buy, so you can avoid legal responsibility for remediation if contamination is found later on. If you decide to finalize purchase of property found to be contaminated, you’re accepting responsibility to clean it up.
This site evaluation isn’t meant to be all-inclusive, but it’s more than cursory. The official description is “all appropriate inquiry.” Your investigator may determine the property is clean, it may have minor contaminants that aren’t deemed dangerous to public or environmental health, or there may be indications that serious amounts of hazardous substances are present, in which case additional investigation is warranted or even required.
It matters who you hire to perform your investigation.
The results of the Phase 1 site assessment are important, for your peace of mind as well as your finances and even your future reputation as the landowner. Hiring an environmental engineering firm allows you to partner with professional scientists whose daily work centers around soil and water and chemicals.
Professionals who are familiar with environmental monitoring regulations and testing aren’t just competent to conduct your research, they can recognize even subtle signs a less knowledgeable investigator might miss. They have the scientific skills and the insight that comes with experience to understand the full implications of anything they find.
What will you learn?
Your investigative team will create a historical overview of your property’s usage, going as far back as possible, by:
Technically a Phase 1 site assessment doesn’t require sampling and testing of soil or water, but you’d be foolish not to include this in the scope of work if your investigative team recommends it. This initial assessment isn’t particularly expensive, and considering the stakes, you want to be as clear as possible about the current status of the property you’re considering buying.
You’ll get a final written report that explains work that was done and the results. But you’ll get something else valuable, too. You will have learned a great deal more about the property and its history than most people know about their land. At the very least, it will be interesting and give you historical perspective.
And even if your prospective property has the most boring history on record, you’ll have a record. You’ll know where you stand. And that’s the purpose of the Phase 1 site assessment.
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