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Phase I Environmental Site Assessments, Part 1

A Phase I Environmental Site Assessment is a report prepared for a real estate holding listing current or potential environmental contamination for the property. Lenders often require the report for certain types of properties before they will lend. Municipalities will also require the report for certain types of subdivisions, building, & development.

Various triggering actions include:

  • Purchase of real property.
  • Lenders financing development of the property.
  • Application to a public agency for development.
  • Existing property owner’s desire to understand toxic history of the property.
  • Compulsion by a regulatory agency who suspects toxic conditions on the site.

In an environment where knowledge of environmental contamination is increasingly important, having this knowledge for real estate holdings if very important. Environmental contamination can turn expensive real estate assets into liabilities.

Additionally when purchasing real estate the buyer may adjust the offer based on an environmental phase I site assessment.

It’s important to know the environmental history of any property that you are considering purchasing. Environmental conditions can drastically change the value of real estate.