What is a Phase I Investigation?

What is a Phase I Investigation?

Environmentally informed commercial realtors ask if a Phase I investigation has ever been done on a commercial property headed for sale.  A Phase I investigation is a records research report and site inspection that identifies any possible environmental threats to a property.  A Phase I consultant researches not only the historic uses of the subject property but also the past uses of the properties surrounding it since contamination can migrate and move beneath properties.  Even if the subject property never had a source of contamination, it could be impacted by an offsite source which can render it useless for business.  California standards for Phase I investigations are specified in ASTM E1527 which outlines the protocol for a complete Phase I environmental site assessment.  If an owner has an old Phase I report, it needs to be updated to current standards to be sure that everything is identified.  If the buyer is applying for a bank loan for the property, the bank will probably request a copy of the Phase I report.  Sometimes buyers will purchase properties with cash and, without a bank involved, the buyer may not realize the need for a Phase I investigation.  A good realtor can educate buyers and sellers on the importance of a thorough and complete Phase I investigation to protect themselves for unknowingly transferring a contaminated property which will end up the subject of a lawsuit.  Phase I consultants can be found on the internet and a review of their proposal will identify if their reports comply with California regulations.

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