Phase I Environmental Site Assessments | Transaction Screens | Phase II Environmental Site Assessments | Property Condition Assessments

Environmental Due Diligence

Be, PLLC personnel have been providing due diligence and compliance services to lenders, developers, borrowers, industrial clients and investors since 1986. Be personnel are available to perform these services anywhere in the contemporaneous the United States. Talk to someone who has the experience and knows the business. Please feel free to contact me directly for cost-effective approach to site investigation and due diligence services.

Environmental due diligence is the process of site study/investigation undertaken prior to engaging in a contract, to provide an accurate asset value. Environmental due diligence, as defined under ASTM guidance researches the current and former property uses to determine the likelihood of environmental impact from former on-site operations, and support the “Innocent Landowner’s Defense” under the Comprehensive Environmental Response, Compensation, and Liability Act, also known as CERCLA. Conducting environmental due diligence activities prior to purchase provides a baseline property condition at the time of acquisition. Due diligence provides the parameters necessary to assess/evaluate potential liability or risk associated with the property.

Standard due diligence services, including Transaction Screens, Phase I Environmental Site Assessments, and Phase II Environmental Site Assessments may be appropriate or necessary. Please do not hesitate to contact me directly to determine if these services are appropriate for your next transaction. This a no costs initial consult.

Should you require environmental liability insurance as part of your environmental risk management program, please contact our affiliate, Aero Alliance. Areo Alliance offers progressive environmental risk management services in addition to traditional avialtion insurance.


Phase I Environmental Site Assessments

Phase I Environmental Site Assessments are completed following the ASTM E 1527-05 Standard Practice for Environmental Site Assessments. Completed Phase I’s are then subjected to a series of reviews for thoroughness and accuracy. Education and experience are the principle qualifications needed to assess and evaluate the potential for liability in real estate transactions. This process identifies Recognized Environmental Conditions (RECs) in association with the All Appropriate Inquiries Rule under Superfund (CERCLA). With over 20 years of experience conducting Phase I site studies, Be personnel will provide you with the information needed to evaluate the true value of the asset.

With most commercial property transactions a Phase I site survey is a requirement for most lending institutions and investors. The Phase I site survey will typically identify on-site or off-site conditions that may have an effect on the property value, and the subsequent loan to value ratio.

The most important part of the Phase I site survey is to have an experienced site investigator performing the survey. With over 20 years of experience conditions Phase I surveys, we provide you a level of expertise that is the foundation for your piece of mind. The Phase I site survey includes the following:

• Data base review (surrounding property review)
• Site visit (interior/exterior - general condition)
• Local records review (tax parcels, etc.)
• Preliminary overview of site characteristics (soil/groundwater/storm water/flood plain)
• Lead based paint, asbestos and mold (additional services which may be added at the time of the survey - out of scope of E-1527)
• Identification of on-site conditions (USTs, prior waste generation/disposal, etc.)

Consider a combination of your Phase I Site Assessment and a Property Condition Assessment. For most commercial properties the potential negative costs may not be associated with the property, but may be associated with the overall property condition.


Transaction Screens

For some properties, the Transaction Screen is a standardized approach to environmental due diligence that provides a generally acceptable degree of confidence about the environmental condition of the property. This level of assessment is only typically used for properties that are not believed to have current or historic site uses that are likely to have impacted the subject property. The assessment includes a site inspection, a limited evaluation of the historical use of the subject property, and the review of an environmental database search.

Completion of the Transaction Screen (E-1508-06) Process in accordance with ASTM standards may allow the user to conclude that no further inquiry is needed to assess the environmental conditions of the property. This will allow the user to invoke the innocent landowner defense without performing a Phase I Environmental Site Assessment. Completion of the Transaction Screen process concludes that (1) no further inquiry into recognized environmental conditions of the property is needed for purposes of appropriate inquiry, or (2) further inquiry is needed to assess recognized environmental conditions appropriately for purposes of appropriate inquiry.

Although a Transaction Screen (TS) is similar to a Phase I Environmental Site Assessment, the TS employs a reduced scope of historical research at a lower cost. The transaction screen does not replace the level of investigation should not be used in place of a Phase I; however, the TS may be a very useful tool in providing environmental due diligence on properties where no environmental assessment would otherwise be performed.

Phase II Environmental Site Assessments

Should recognized environmental conditions (RECs) or areas of concern be identified during a Phase I process, we are qualified to further delineate the concern through a Phase II Environmental Site Assessment (E-1903-97). A Phase II evaluation typically includes sampling of soil, groundwater, surface waters, or suspected hazardous materials on or off the subject property. The scope of the Phase II site study is tailored to each site based on information obtained during the Phase I site study.

Data from the sampling effort is compiled and evaluated to determine the location and extent of site impairment. A well executed Phase II evaluation aids in the determination of potential regulatory reporting obligations and in a determination of potential remedial costs. The presence (or suspected presence) of impacts on a property can adversely affect the value of the asset. Typically, some assets have an elevated potential for impact (such as dry cleaners), these properties may require a Phase II regardless of the results of the Phase I process.


Commercial Property Transactions
Property Condition Assessments

The current physical conditions of a property (buildings, improvements, etc.) need to be considered as they impact potential future earnings and property values. Assessments of commercial properties are a tool used to identify immediate deficiencies associated with each property/building element and to quantify the cost associated with those necessary repairs. Further, the assessment includes an estimate of capital reserves anticipated over the assessment or loan term. The assessments (typically referred to as PCAs) are known by different names including Property Condition Assessments (E-2018-08), Physical Needs Assessments, Structural Assessments, and others. The PCA should be considered as part of any commercial real estate transaction. In many cases the information derived though a PCA may lead to the identification of costly problems with the asset.

The PCA inspection includes an evaluation of:

• Structure - concrete, steel and wooden components
• Building envelope - roof, sidewalls, windows and doors
• Roofing system - surface material, condition, age and estimated remaining useful life
• Interior finishes - floors, walls, ceilings

Mechanical systems and infrastructure:

• Mechanical - HVAC - current condition and remaining useful life
• Electrical - and components
• Plumbing systems and fixtures
• Fire suppression and Life safety


• Hardscape - parking areas, walkways - components and condition
• Landscaping
• Storm water flow
• Aesthetics - general evaluation of the overall property presence

Additional Services which may be included on request (these services may be subcontracted at the point of origin):

• Elevator inspection
• Pest inspections
• Mold, asbestos and Lead Based Paint
• Facade evaluations

A Property condition Assessment is typically tailored for the clients needs, the survey may be conducted in varying steps, from an initial survey to as detailed as required. The PCA report also includes a summary of the immediate deficiencies and a reserve table for expected expense.

Please feel free to contact me directly for cost-effective approach to site investigation and due diligence services.


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