Prior to purchasing a parcel of commercial property, most lending institutions will require that a Phase I Environmental Site Assessment (ESA) be performed for the property. Even if it is not required, a Phase 1 is an appropriate step in the sale of a property, since it will inform the buyer of any potential contamination from previous operations. The goal is to identify "reccognized environmental conditions" (RECs), which include known and assumed hazards to human health.
In accordance with ASTM E1527-05, a Phase I ESA investigation involves historical research, interviews, and a visual inspection of a property. Conducting an investigation per these guidelines permits the prospect purchaser to qualify for one of the requirements as an innocent landowner. It does not include testing and analysis of potentially hazardous materials. When a Phase I ESA indicates the presence or likely presence of hazardous substances or petroleum products, a Phase II ESA is recommended.
Since 1994, Ellis has performed Phase I and II ESAs' for a variety of municipalities, state and local property managers and developers. Our investigations comply with ASTM E-1527-05 and are accepted by all major lending agencies. NOTE: Along with a growing number of professionals, Ellis does not agree with or subscribe to SBA "Reliance Letter" conditions. Primarily, we believe it is inappropriate to place a document written by others onto our own letterhead, and to then accept its liability exposure as our own.