Know this Before Closing on a Commercial Real Estate Deal
As we head closer to the end of the year, I am sure we are all starting to think or have already thought of some new year resolutions. It is exciting to know that there is a new year coming and that there will be so many new opportunities waiting for us. With that being said, if your new year resolution is to purchase or sell commercial real estate, we have some great information that will help you in the process.
Buying and selling commercial real estate can be tricky if you do not do your research. It is important to know the environmental condition of your current or future property before closing a deal. The reason for this is that, you as the buyer or seller do not want that property to become a liability if it had previously been contaminated due to historical use.
How do I know if my current or future property has been contaminated?
Before purchasing a property, it is always important to ask the property owner and get documentation on if the land has been properly assessed, treated, and cleared from contamination.
If you are the owner and plan on selling the property, the first step to check if your property has been contaminated is by performing a Phase 1 Environmental Site Assessment. This is an inspection that will determine if there is a presence of hazardous material on the property. If nothing is found, you can proceed to the closing transactions.
If a presence of hazardous material is found on the property, the next step to take is to conduct a Phase 2 Environmental Site Assessment (not required but it is recommended). This will assess the contamination further by examining exactly what is contaminating the property.
Lastly if you wish to take action on clearing the hazardous materials off of your property, a Phase 3 Environmental Site Assessment / Environmental Remediation will need to take place.
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