Business Facilities - June 2008 - (Page 49)

REAL ESTATE TRENDS By John Katze, National ESA Technical Director, EBI Consulting and Bill Gibbons, Manager,Site Investigation Services, EBI Consulting Engaging a consultant and conducting an environmental site assessment on properties under consideration can save time and money later. I n a turbulent commercial real estate market, with enforcement of ever-tougher environmental regulations a constant priority, it is more important than ever to conduct environmental due diligence that is thorough, timely, and meets the needs of the real estate transaction. Because the required cost and John Katze is National ESA Technical Director for EBI Consulting and is a registered Professional Geologist with 15 years of experience conducting and managing thousands of environmental due diligence assessments. He can be reached at jkatze@ebiconsulting.com. Bill Gibbons is the Manager of Site Investigation and Remediation Services for EBI Consulting and is a registered Professional Geologist with 22 years of experience in oil and hazardous materials site investigation and remediation. He can be reached at bgibbons@ebiconsulting.com. time of environmental due diligence increases if successive phases of environmental investigation are needed, there is a benefit to involving one’s environmental consultant in the site selection process for relocation or expansion. At a minimum, it is recommended that an ASTM Phase I environmental site assessment (ESA) be conducted on a short list of properties being considered for relocation or expansion. Environmental due diligence can reduce the severity of future liabilities and can affect the outcome of an imminent real estate transaction. The timeline of the transaction, the expertise it demands, and the intended use, scope, and legal ramifications of the transaction’s due diligence must be considered. Here is an overview of the steps that should be taken and important questions which should be posed to a potential consultant to ensure that proper environmental due diligence is completed: Environmental due diligence is generally conducted for the purpose of assessing a property involved in a real estate transaction for the presence of contamination (of soil, ground water, indoor air, etc.). Contamination of these media may represent significant financial and legal liability to the parties involved in the real estate for several reasons. Liability can result from enforcement actions by the federal Environmental Protection Agency or state regulators; the impact of contamination on the marketability and, therefore, the value, of the subject property; litigation from off-site properties impacted by a release from the subject property; or litigation by persons who claim to have suffered adverse health affects from contamination at the subject property. Industry professionals have created standards and practices for conducting ESAs to evaluate real estate for such potential liability. Congress codified the standards for conducting environment due diligence in 2005 with the enactment of the Standards and Practices for All Appropriate Inquiries, Final Rule (AAI). In turn, ASTM E 1527, Standard Practice for Environmental Site Assessments: Phase I Environmental Site Assessment Process also was updated in 2005, satisfying the requirements of the AAI rule. To BUSINESS FACILITIES 49

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Business Facilities - June 2008 Contents First Word Snapshots Metro Spotlight: Austin, TX The Greening of America Winds of Change in the Berkshires Hot Logistics Locales Metro Spotlight: New Mexico Borderplex Hollywood on the Louisiana Bayou Idaho: Gem State's Economy is Glittering Mayor's Reports New Brunswick, Canada's Export Leader Virginia: Where Business and Fun Come Together How Green Is Your Site? Maine's New Maritime Marketing Message Corporate Moves: Alabama Advertiser Index Ask the Expert

Business Facilities - June 2008

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