Dec 07
I have been asked a lot recently about Phase 1s. I realize there is a lot of confusion about them. Let me try to clear the air a bit so to speak.In its simplest terms a Phase 1 is a site visit and document review of the surrounding area to determine if further investigation is advised from an environmental stand point.A Phase 1 inspection is a review of local governmental documents regarding the site to determine what the past usage of the site was along with extensive document review of the surrounding area. It also entails a very involved and detailed site visit by a qualified professional. In addition there is data base information that is gathered and reviewed of the surrounding vicinity to determine if there is a potential risk from an environmental stand point in the immediate area.
These potential risks can be anything from a past gas station on or near the site that might have contaminated the ground water to there having been a dry cleaner on the site that might have spilled chemicals into the ground. There could have been past dumping on the site or an auto repair that did not handle the oils properly, lead in the paint, asbestos, and on and on.
I think you get the picture. The focus of a Phase 1 inspection is environmental not the structure or any of the systems of the building. The systems are the focus of the general visual inspection. They are two separate areas of responsibility. Both are important. Many lending institutions require a Phase 1 clearance before they will lend money.
A Phase 1 inspection is an integral part to many commercial and industrial real estate transactions. One bank that I know of will not lend for any commercial or industrial transaction on real estate over 1.5 million dollars without a Phase I. We are hard pressed to buy anything in the Los Angeles area in the commercial or industrial real estate area for under that.
There are two other aspects to a Phase 1 that may come into play depending on what is found during the Phase 1 inspection and research. These are Phase 2 and Phase 3. As you might assume Phase 2 and Phase 3 are the more involved aspects of the environmental field. Phase 2 involves testing of the site such as coring into the earth and taking samples of the soil along with testing it to determine what is in the soil. The information during a Phase 2 will determine if the site warrants further investigation and/or to be remediated. If remediation is needed this is Phase 3.
Each environmental Phase whether it is Phase 1, 2 or 3, has a very involved set of industry standard requirements. Each requires highly trained professionals to do properly. This is not an area to skimp on. Have a reliable company with vast experience do your Phase 1 inspection. Getting the cheapest deal for something this important I feel could easily be fiscally irresponsible. A properly done Phase 1 inspection really is for everyones protection not just the buyer.
The current rate for a professionally done standard Phase 1 inspection is approx. $1800.00 - $2000.00. Just so you understand to obtain the above mentioned documents is hundreds of dollars by itself. The report ends up usually being hundreds of pages. This price does not usually change unless the site gets very large and very involved. Currently the price stated will usually handle over 90% of all commercial real estate transactions.
I hope this clears the air a bit on what a Phase 1 inspection is.
About the Author
Bob Pace has been a Certified Inspector since 1994 and a licensed contractor for nearly 4o years. For more information about commercial real estate inspections visit his website at http://www.commercialrealestateinspectors.com to find out how he can help with your real estate inspection.
written by Phase I Phase One Environmental Site Assessment, Due Diligence
Informative Articles
May 04
The purpose of a Phase I ESA is to identify, to the extent feasible, recognized environmental concerns in connection with the property. This assessment included a site reconnaissance as well as research and interviews with representatives of the public, property management, and regulatory agencies.
From Wikipedia:
A Phase I Environmental Site Assessment is a report prepared for a real estate holding which identifies potential or existing environmental contamination liabilities. The analysis, often called a Phase I ESA, typically addresses both the underlying land as well as physical improvements to the property; however, techniques applied in a Phase I ESA never include actual collection of physical samples or chemical analyses of any kind. Scrutiny of the land includes examination of potential soil contamination, groundwater quality, surface water quality and sometimes issues related to hazardous substance uptake by biota. The examination of a site may include: definition of any chemical residues within structures; identification of possible asbestos containing building materials; inventory of hazardous substances stored or used on site; assessment of mold and mildew; and evaluation of other indoor air quality parameters[1].
Actual sampling of soil, air, groundwater and/or building materials is typically not conducted during a Phase I ESA. The Phase I ESA is generally considered the first step in the process of environmental Due Diligence.
written by Phase I Phase One Environmental Site Assessment, Due Diligence
Definitions, Exclusive Articles, Informative Articles
May 06
We have started a new page that will list definitions of environmental terms. We will keep adding to it regularly so please keep check back. Also, if you have any requests or have some more information you would like included, please contact me.
The ‘Definitions Page’ is linked to from the upper right hand side bar or you can click here to access it.
The definitions page will contain or currently contains definitions related to all appropriate inquiry, astm 1527, brownsfield sites, due diligence, cercla, phase i, phase ii, phase ii, phase one, environmental site assessment, environmental remediation, epa standards, contamination, groundwater, UST, underground storage tanks, vapor, hydrocarbons, superfund, and more.
written by Phase I Phase One Environmental Site Assessment, Due Diligence
Definitions, Exclusive Articles
May 05
Phase 1 Environmental Site Assessment News:
From the JournalPress.com:
Anne Congdon 23.APR.08
Monday night, April 21 was the first community meeting with LandStudio, the professional planning and landscape architecture corporation that has been retained by the Town Council to examine possible uses for the soon to be vacated Public Works site located at 700 Colonial Avenue. A detailed site analysis, including a Phase I (One) Environmental Site Assessment, has been completed and the purpose of the workshop was to share that information and garner feedback from the community. The project goals of the future use site planning process are “gaining a solid understanding of the site and its inherent opportunities and constraints; Looking holistically at the town and its future needs in determining potential future uses of the site; and Opening up a dialogue and building consensus on the future use of the site with all the various stakeholders and interested citizens.”
Read the Entire Story.
written by Phase I Phase One Environmental Site Assessment, Due Diligence
News, Bulletins, & Press Releases
May 05
From CBC News:
A controversial affordable housing project in Fredericton has been scrapped after the costs for environmental studies became too high for the non-profit developer.
In November, Fredericton city council approved Fredericton Non-Profit Housing Corp.’s plan to convert a building on Dundonald Street into a six-unit apartment complex.
Residents along Dundonald Street had argued the building was only zoned for a two-unit complex and that the conversion would bring more traffic to the neighbourhood and destroy its family ambience.
Developer Eldon Toner told CBC News he decided to back out of creating the affordable housing when he learned he’d have to pay more than $30,000 for environmental studies on the site.
“We did a phase one and then a phase two and the phase two was to recommend a phase three environmental study on it and we decided at that time not to because of the cost and the money we had already invested,” Toner said.
The environmental report is required because the building used to be used as a commercial site.
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written by Phase I Phase One Environmental Site Assessment, Due Diligence
News, Bulletins, & Press Releases
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