PHASE I | Barrcrest

PHASE I ENVIRONMENTAL SITE ASSESSMENT

WHAT IS A PHASE I ENVIRONMENTAL SITE ASSESSMENT?

A Phase I Environmental Site Assessment (ESA) or “environmental due diligence” is a report prepared for a real estate holding that identifies potential, or existing, environmental contamination liabilities. The analysis, often called an ESA, typically addresses both the underlying land as well as physical improvements to the property. A Phase I is considered the first step in the due diligence process, and sampling of soil and groundwater, if needed, is not conducted during the course of a Phase I study. Overall, the environmental investigation is designed specifically to determine whether environmental degradation has occurred on a property, and the likelihood of potential liability for potential purchasers, current or past owners/operators, and financial institutions.

IS THERE AN INDUSTRY STANDARD?

Yes, in order to qualify for the innocent landowner defense for a property transaction, the Phase I must adhere to the ASTM Standard Practice for Site Assessments E-1527-13 following the USEPA All Appropriate Inquiry from low to very high risk properties.

DO I REALLY NEED PHASE I?

The need for the ESA stems from the all appropriate inquiry set forth in Section 9601 (35) (b) of the Comprehensive Environmental Response, Compensation and Liability Act (CERCLA). If the real estate transaction involves a commercial or industrial property, yes, you need a Phase I.

AGAIN, DO I REALLY NEED PHASE I?

Afraid so. The ESA is a standard requirement for most lending institutions and some insurance carriers prior to a commercial real estate transaction. It is also sound business practice to have an ESA conducted prior to closing on a property in a private lending transaction to ensure against future liability, both on-property and off-property.

WHAT DOES PHASE I INCLDE?

BarrCrest researches the historical usage of each property and adjacent properties to at least 1940. Oftentimes, especially in the New York Metro area, Barr can determine the historical usage of a property back as far as the 1880s;

BarrCrest reviews the federal, state and local databases to determine if the subject property is listed on any of the database. Furthermore, the research includes properties within a one-mile radius of the target property;

BarrCrest conducts a property specific study of the geologic, and hydrogeologic conditions identified for the property;

BarrCrest goes beyond the ASTM standards and includes:

Federal Emergency Management Agency National Flood Hazard Layer Map;
Unites States Fish and Wildlife Service National Wetlands Inventory property specific wetlands map;
Current drinking water quality reports;