Phase I Environmental Site Assessment, also called Environmental Due Diligence Audit (EDDA/DDA), is meant to evaluate the environment-related risks and liabilities of a property or a project and is part of the due diligence process. A Phase I ESA is a comprehensive research report of a property’s historical and current land uses in search of any possible environmental liabilities, liens and concerns at the time of a real estate transaction/ disposal. This assessment is based on ASTM standards or the American Society for Testing and Materials standards, which serves industries, such as construction, metals, petroleum, consumer products etc. Areas where toxic and hazardous substances exist at levels and conditions that can pose imminent threats to health or the surrounding environment frequently pose complex health and environmental issues to society. They can harm the natural atmosphere, especially surface waters, soils, and groundwater, and can bring attention to toxic substances knowingly or unknowingly. Some common causes of concern during land disposal are industries that generate hazardous waste, gas stations, auto/vehicle repair, printing operations, and units manufacturing some specific items. To illustrate the components of a Phase 1 ESA, the following items are included.
ASTM standards require Phase 1 Environmental Site Assessment to have certification by registered environmental professionals, geologists and engineers. Manufacturing areas, landfills, dumps, waste storage and treatment sites, mine tailings sites, spill sites, chemical waste handlers and storage sites are all examples of contaminated sites. These sites could be in an urban, residential, rural, agricultural, commercial, recreational, industrial, or wilderness setting. As such situations are also applicable in the Indian context, the need for such site assessment is gaining popularity.
The Phase I Environmental Site Assessment process uses multiple sources of information extensively and comprises strategic environmental compliance audits. The standard practice is to identify any violation of environmental compliance, whether historical or concurrent. And the. This assessment will typically provide a non-invasive, visual analysis of the land and enhancements to ascertain the following:
The Phase I ESA t is the gold benchmark for assessing the environmental liability associated with any commercial real estate asset. The main components of a Phase I ESA include a review of regulatory records, interviews, review of client-provided information, review of historical documents and report preparation. The steps involved in the assessment include
ESA or EDD is the process of inquiring into environmental characteristics or other relevant topographic conditions prior to the trade of the property and is usually in done in connection with a commercial estate transaction. The degree of ESA / EDD may vary for different properties and purposes. A Phase I Environmental Site Assessment typically includes the following:
The collection and evaluation of physical samples, such as water and soil samples, is not included in Phase I ESA as these are a part of the Phase II Environmental Site Assessment Report (Phase II Report), which is completed if contamination is suspected or the previous use of the property requires it.
Once a Phase I ESA is complete, the Environmental Professional summarises what concerns were identified on the property and make recommendations about what actions, if any, are needed to address these concerns. . It is so because the presence of such concerns has the potential to change the landscape and have an impact on the area’s ecosystem A recognised environmental condition (REC) will indicate the known contamination or their potential to be impacted by any type of contamination (either from the subject property or possibly from an offsite source). The Phase I Environmental Site Assessment (ESA) & Due Diligence Audits can help the proponent in the following ways.
Buying a commercial property requires plenty of research and due diligence on the buyer’s part. They want to know everything about the property before they invest their hard-earned money into it. As Phase I Environmental Site Assessment is evaluated by the Environmental Professional (EP) to identify potential environmental risks to the property, a commercial property, no matter what it will be used for, must go for such assessment as they will be affected by the environment around them.
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