Due Diligence / Property Transactions

Aarcher performs Phase I Environmental Site Assessments to support the commercial and multi-family real estate industry. We understand the need for carefully prepared reports, both in terms of managing risk and streamlining the transaction process.

 

Phase I Environmental Site Assessments

The American Society for Testing and Materials (ASTM) E1527-13 Standard (“Standard Practice for Environmental Site Assessments: Phase I Environmental Site Assessment Process) is widely recognized as the standard for evaluating environmental risk associated with commercial real estate. EPA’s All Appropriate Inquiries (AAI) Rule (November 2006) clarified requirements for a Phase I Environmental Site Assessment to qualify for liability protection under the of Comprehensive Environmental Restoration, Compensation, and Liability Act (CERCLA) “innocent landowner defense.” The scope of the AAI Rule and ASTM E 1527-13 are now mutually consistent and include the following:

  • Site Visit
  • Historical Research (historical aerial photographs, reverse street directories, building permits, planning records, topographical maps, Sanborn fire insurance maps, oil and gas maps, title information)
  • Geology and Hydrogeology Evaluation
  • Regulatory Research (fire departments, state environmental agencies, Federal environmental agencies)
  • Interviews and Document Review

[ASTM published ASTM E1527-13 on November 6, 2013, requiring additional data collection and evaluations, such expanded regulatory file reviews, vapor migration evaluation, clarification of certain terms and the addition of the “Controlled Recognized Environmental Condition” (CREC) term. These changes are standard practice for competent firms performing Phase I Environmental Site Assessments.]

Purpose of Phase I Environmental Site Assessments

The Phase I Environmental Site Assessment process results in a valuable assessment of environmental conditions of a specific parcel of commercial real estate, but does not necessarily address other environmental issues and risks raised in transactions such as purchases of real property or business assets, such as environmental liabilities stemming from properties previously owned or operated by the business, or environmental liabilities existing other locations.

This practice is intended as an approach to conducting an inquiry designed to identify “recognized environmental conditions” in connection with a property and represent a commercially prudent and reasonable inquiry, but its use can go beyond that purpose. This practice results in developing information about the environmental condition of a property, and is useful for a wide range of users, including those exposed to risk under the CERCLA.

Obtaining a Phase I Environmental Site Assessment

In accordance with ASTM E1527-13, a Phase I Environmental Site Assessment must be performed by an “environmental professional,” as defined by the standard, and the value of the results are dependent on the experience and judgment of this professional. The professional judgment of the selected environmental professional is vital to the performance of all appropriate inquiries.

Visit the “Aarcher Advantages” and “Project Experience” tabs to learn about Aarcher’s Phase I Environmental Site Assessment capabilities.