There’s no surprise worse than discovering the property you just purchased is contaminated with some sort of hazardous waste. Conducting a Phase I site assessment can help warn you of unpleasant and potentially very costly problems before you purchase commercial real estate, protect you as the property owner and mitigate your liability when you’re ready to sell.
At first glance this investigation process may seem like just another painful governmental intrusion. But in fact, it’s a smart business investment if you’re considering purchasing property that could even conceivably be contaminated. A Phase I site assessment also helps protect lenders or anyone else that must meet “All Appropriate Inquiry” requirements.
Here’s a checklist of factors your Phase I site assessment should cover.
Historical search
This includes:
- Checking maps and directories as far back as feasible, ideally to when the “property first contained structures or was used for residential, agricultural, commercial, industrial or governmental purposes.”
- Interviews with current and/or past owners and tenants.
- Additional efforts to uncover special knowledge about the property and identify whether the purchase price reflects existence of known contamination.
Regulatory agency review
The aim of this process is to discover any indication of known problems that are deemed not solely the user’s responsibility. This search looks at documents from all relevant jurisdictions including local, county, state, federal or tribal.
Site inspection
This step involves identification of possible contamination on the property or proximate to it. A comprehensive review looks at:
- Heating sources such as oil, electric, natural gas or propane.
- Underground and aboveground storage tanks, including fill ports, vent pipes, feed and return lines.
- Plumbing, including sewer, cesspools, leaching fields, drywells and on-site water production wells, roof drainage, sump pumps, floor drains and fixtures.
- Building construction, materials and condition, especially potential asbestos-containing pipe wrap, floor tiles, roofing, siding and insulation.
- Lead paint.
- Water or mold damage.
- Existing structures, particularly for engineering concerns.
- Fill materials–a common concern throughout New York City.
- Former uses including dry cleaning, dental or X-ray office, gas station or auto repair, manufacturing, printing or photograph processing, etc.
- At least a cursory review of surrounding property.
Findings and recommendations
Phase I site assessment results are summed up in this final step. You are not required to formally report these results to any regulatory agency. But if it turns out the real estate you’re considering is indeed contaminated, you’ll be able to make an intelligent, fully informed decision about whether to go forward, and at what purchase price.
A qualified environmental consultant like Walden can help complete a Phase I assessment for your potentially contaminated site. Learn more about our site investigation and remediation services here. Contact us at 516-588-6859 to determine whether you would benefit from this process.