There’s been a lot of talk lately about Phase 1 environmental site assessment. It’s becoming more frequently required to complete real estate purchases, especially for commercial property. Perhaps not surprisingly, myths have developed surrounding Phase 1 site assessment.
Let’s explore some of the common myths.
Phase 1 environmental site assessment is expensive.
Actually, it’s not. And the return on your investment in this process can be significant, especially if you can obtain “innocent landowner” status. Regardless of the outcome, you’ll have the peace of mind that comes from knowing the facts.
Phase 1 environmental site assessment is time-consuming.
Typically the investigation takes two or three weeks. That may seem like a long time if you’re anxious to move forward with your purchase, but it’s nothing compared to the length of time you’ll probably own the property.
And if you wind up inadvertently purchasing not just real estate but liability for cleaning up hazardous substances, that could take years.
Phase 1 environmental site assessment is unnecessary.
It’s important enough that some lenders include it as one of their pre-funding due diligence requirements. Aside from that, the risks of acquiring responsibility for a contaminated site are so high you can’t afford to not know in advance what you’re purchasing.
The investigation will also uncover additional information about the site’s history that could benefit you in other ways as the new owner.
Anyone can conduct a Phase 1 environmental site assessment.
This is essentially true but not the best plan. Although the assessment includes a great deal of “paperwork” research – of past documents and other records, discovering past uses, talking to owners or tenants – the fact is that much of it is technical in nature.
An experienced professional that works every day with environmental engineering issues is best qualified to conduct a thorough investigation. And isn’t that what you want?
Phase 1 site assessment is becoming a necessity, so you may have no choice. But the bottom line is that it’s in your best interests if you’re considering a real estate purchase.
Photo Credit: Eggrole