Under the general standard ASTM E1527-21 a Phase 1 Environmental Site Assessment (ESA) is typically performed for a real estate holding that identifies potential or existing environmental contamination liabilities. The analysis, often called an ESA, typically addresses both the underlying land as well as physical improvements to the property. The Phase 1 ESA is generally considered the first step in the process of environmental due diligence. In general, the assessment is performed to uncover any environmental risks before purchasing a property. Phase 1’s are also performed to identify if any contaminations have occurred since a last Phase 1 or if a property owner/manager rents the property to an entity that may have caused an environmental concern.

Any entity that is going to purchase land to be developed or is a commercial/industrial property, or leases land commercially, should have a Phase 1 performed. This reduces risk later on that may not have been known. Phase 1’s are known to release “Landowner Liabilities”. A big misconception is a deed releases the landowner but it does not, environmentally.

Records review - The examination of a site includes scope items such as: definition of any chemical residues within structures; inventory of hazardous substances stored or used on site; review of Federal, State, Local and Tribal Records out to distances specified by the ASTM 1527-21 and AAI Standards (ranging from 1/8 to 1 mile depending on the database). This is:

Examination of municipal or county planning files to check prior land usage and permits granted;

Conduct file searches with public agencies (State water board, fire department, county health department, etc.) having oversight relative to water quality and soil contamination issues.

• Examine historic aerial photography of the vicinity.
• Examine current USGS maps to scrutinize drainage patterns and topography.
• Examine chain-of-title for Environmental Liens and/or Activity and Land Use Limitations (AULs).

In most cases, the public file searches, historical research and chain-of-title examinations are outsourced to information services that specialize in such activities.

Performance of an on-site visit to view present conditions (chemical spill residue, die-back of vegetation, etc.); hazardous substances or petroleum products usage (presence of above ground or underground storage tanks, storage of acids, etc.); and evaluate any likely environmentally hazardous site history to include evaluation of risks of neighboring properties upon the subject property.

AAI requires an interview of persons knowledgeable regarding the property history (past owners, present owner, key site manager, present tenants, and neighbors).

Include visual inspections or records review searches for:

• Asbestos Containing Building Materials (ACM)
• Lead-Based Paint
• Lead in Drinking Water
• Mold
• Radon
• Wetlands
• Threatened and Endangered Species
• Vapor intrusion

The Small Business Administration’s environmental policy (SOP 50 10 5(j)) has particular requirements regarding environmental due diligence on properties, which includes Records Search with Risk Assessment (RSRA), Phase 1 Environmental Site Assessments and sometimes additional investigation.

A Records Search with Risk Assessment is a limited environmental due diligence tool intended to inexpensively evaluate Environmental Risk Level of a subject property as either being a “high or elevated-risk” or “low risk” for contamination. If the property is not determined “low risk”, an additional environmental investigation may be required.