Business Facilities - June 2008 - (Page 50)

REAL ESTATE TRENDS Environmental Due Diligence Begins During Site Selection date, ASTM E 1527 remains the most widely used industry standard for conducting the initial phase of environmental due diligence. QUALIFY YOUR CONSULTANTS Proper environmental due diligence begins by selecting a qualified environmental consultant. A Statement of Qualifications (SOQ) package should be requested from the consultant. The SOQ should contain information pertaining to the experience and background of the consultant, including what types of services they provide, where they have worked, for whom they have worked, and on what types of properties they have worked. #2005 at www.BusinessFacilities.com All consulting firms should employ staff that meets the definition of an “Environmental Professional,” as defined by ASTM E 1527-05. This definition is based on education, experience and/or certifications, and constitutes an individual who meets the industry qualifications to manage the Phase I ESA. It also is beneficial to work with a consultant who has experience conducting assessments in the general locale and on the property type involved in the real estate transaction. Further, the consultant/firm should have applicable regulatory licensure to conduct business in the state and for the type of assessment being completed for the transaction. For example, if asbestos sampling is being conducted, the consultant should be a licensed asbestos inspector. At times, the intent of real estate due diligence is to satisfy the requirements of a lender. If so, it is important to consider a consultant who has experience with the lender involved in the transaction and is on that lender’s approved vendor list. Retaining a consultant that has not been approved by the lender may result in delays and complications in the environmental due diligence process. If a due diligence assessment, beyond what is encompassed by a basic ASTM Phase I ESA, is desired or may be useful at a later time, a consulting firm with experience in indoor-air vapor intrusion, wetlands delineation, and environmental permitting should be selected. Most firms performing ASTM standard assessments do not have this experience. To avoid confusion in what is expected, the contract for the work should specifically identify the desired scope. DEFINE THE SCOPE As indicated above, environmental due diligence typically begins with a Phase I ESA conducted to at least the industry standard, ASTM E 1527-05. However, other factors should be considered beyond this industry minimum depending upon your company’s needs. For example, many lenders have due diligence requirements that exceed ASTM E 1527-05, such as conducting a screening for the presence of wetland areas. Or, depending upon the age of the building, a prerenovation asbestos survey to identify and quantify the extent of asbestos-containing materials may be warranted. It is critical to discuss the scope of environmental due diligence services with your environmental consultant from the earliest stages of the transaction process. This consultation is key to formulating an environmental due diligence package that suits the needs of your company. Environmental concerns are rarely “black or white” or “cut and dried.” In most cases, there is more than one way to view a concern identified during the course of environmental due diligence. With that said, it is important to be sure of the reason and the intended use of the environmental due diligence that is being conducted. For example, if the objective of the due diligence is to obtain a loan, the directive to the consultant may be to simply satisfy the requirements of the lending institution. However, if the goal is to use the results of the environmental due diligence for contract negotiations with the seller, the consultant might be instructed to take a conservative (less risk tolerant) approach to issues. Environmental 50 JUNE 2008 http://www.embdc.org http://www.embdc.org http://www.BusinessFacilities.com

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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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