Phase 3 Environmental Site Assessments (ESA): What is it and why you may need one!
Environmental site assessments are important tools that help commercial property buyers, owners, lenders, and developers identify and mitigate environmental liabilities. They are often required by lenders and investors prior to loan approval for the purchase of commercial real estate. This assessment considers factors such as site characteristics (e.g., location, geology), contaminant concentrations, land use patterns, and local drinking water sources in order to estimate potential risks posed by the contamination.
What is Contamination?
Contamination is defined as the presence of hazardous substances in soil, water, or air that may pose a risk to human health or the environment. Contaminants can come from many sources, including past or present industrial and commercial activities, use of pesticides and fertilizers, disposal of hazardous wastes, and leaking underground storage tanks.
What are Risk-Based Concentrations?
Risk-Based Concentrations (RBCs) are contaminant concentration levels above which adverse human health or ecological effects are expected to occur. RBCs are typically derived from scientific literature and used by environmental professionals to evaluate site contamination and delineate contaminated areas.
All commercial properties should have an ESA performed as part of due diligence prior to purchase or sale. And if any potential contamination is identified during a Phase 2 ESA, then a Phase 3 ESA should be conducted to fully assess the situation.