When Do You need an Phase 1 Environmental Site Assessment?

Having provided Environmental due diligence Phase 1 reports all over the world including Australia, Canada and the USA we often get asked the question when do I need a Phase 1 Environmental Assessment?

This is a very good question.  Part of your due diligence when purchasing a commercial property should always be to obtain a Phase 1 ESA.  Nearly all bank lenders will insist on this being completed as they do not want to take the risk of a mortgaged property being situated on a contaminated site. They are not insisting you have this report completed to incur extra costs for you but simply because they want to protect their investment.
If you were buying the land outright would you want to take that gamble? Hopefully you are reading this and said a resounding NO!

So it is not always a requirement that you have an ESA Phase 1 completed but you would be taking a huge gamble that could prove very costly in the long run if you didn’t.

The Phase 1 ESA report is very important as it can protect you from liability and let you know before purchase of any risk that might be associated with purchasing said property.
This contamination could be environmental contamination such as groundwater and soil contamination or contamination resulting from the use of unsafe building materials such as asbestos.
If there is contamination then you can renegotiate the price to incorporate the cost of cleanup or you can simply walk away from the deal.  Whatever you decide it means you go into the purchase with your eyes wide open to any issues that you face or may not face down the road