Benefits of Phase I ESAs
The Phase I ESA is relatively fast — it is possible to conduct an assessment in a month or less. This process is most effective when performed at the start of a transaction’s due diligence period, so it would not be expected to hinder a typical commercial real estate transaction. In addition to its rapid completion, there are numerous other benefits from Phase I ESA findings.
Identifies past usage
As businesses come and go, a commercially zoned property can change hands several times. A Phase I ESA can identify past uses that are common sources of environmental impact, which may not be readily apparent. For example, if the site was previously occupied by a gas station or dry cleaner, the risk of environmental impact is higher than if the property had been occupied by a retail store or office space.
Reduces risk exposure
Though the property’s intended use may not present obvious environmental risks, previous owners may have engaged in activities that caused contamination. The Phase I ESA can identify these issues and help ECS’ remediation team develop an appropriate scope for a Phase II assessment.
Meets lender requirements
Lenders frequently require that a Phase I ESA be performed before processing a loan. This step is included in an effort to find previously unknown contamination that might impact the value of the property, as this could affect the buyer’s ability to repay the loan.
ECS has experience tailoring our reports to meet the unique scope requirements of lenders and has been designated as a pre-approved vendor by numerous national and international lenders. ECS also frequently prepares Phase I ESA reports to meet the requirements of US HUD, Fannie Mae and Freddie Mac. This experience can help support a smooth due diligence process and sees that lender concerns are properly identified and addressed.
Offers buyer protection
If a Phase I assessment discovers suspect contamination, a Phase II can be performed to better understand the nature and extent of impact to the subject property and whether additional steps such as remediation are necessary. This information can be used to better understand environmental costs associated with development projects and to negotiate a lower price during property transactions.
Benefits of Phase I ESAs
The Phase I ESA is relatively fast — it is possible to conduct an assessment in a month or less. This process is most effective when performed at the start of a transaction’s due diligence period, so it would not be expected to hinder a typical commercial real estate transaction. In addition to its rapid completion, there are numerous other benefits from Phase I ESA findings.
Identifies past usage
As businesses come and go, a commercially zoned property can change hands several times. A Phase I ESA can identify past uses that are common sources of environmental impact, which may not be readily apparent. For example, if the site was previously occupied by a gas station or dry cleaner, the risk of environmental impact is higher than if the property had been occupied by a retail store or office space.
Reduces risk exposure
Though the property’s intended use may not present obvious environmental risks, previous owners may have engaged in activities that caused contamination. The Phase I ESA can identify these issues and help ECS’ remediation team develop an appropriate scope for a Phase II assessment.
Meets lender requirements
Lenders frequently require that a Phase I ESA be performed before processing a loan. This step is included in an effort to find previously unknown contamination that might impact the value of the property, as this could affect the buyer’s ability to repay the loan.
ECS has experience tailoring our reports to meet the unique scope requirements of lenders and has been designated as a pre-approved vendor by numerous national and international lenders. ECS also frequently prepares Phase I ESA reports to meet the requirements of US HUD, Fannie Mae and Freddie Mac. This experience can help support a smooth due diligence process and sees that lender concerns are properly identified and addressed.
Offers buyer protection
If a Phase I assessment discovers suspect contamination, a Phase II can be performed to better understand the nature and extent of impact to the subject property and whether additional steps such as remediation are necessary. This information can be used to better understand environmental costs associated with development projects and to negotiate a lower price during property transactions.
The Phase I site assessment process involves a site and area reconnaissance, regulatory file and historical documentation review, and interviews with persons having knowledge of the site. A standard Phase I ESA does not include sampling or analyses of soil, groundwater, air or building materials.
