What is a Phase I Environmental Site Assessment (ESA)?

Under the general standard ASTM E1527-13 a Phase I 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 I Environmental inspection 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 I ESA is also performed to identify if any contaminations have occurred since the last Phase I or if a property owner/manager rents the property to an entity that may have caused an environmental concern.

Standards for performing a Phase I site assessment have been promulgated by the US EPA and are based on the updated ASTM standard in Standard E1527-13. The actual sampling of soil, air, groundwater and/or building materials is typically not conducted in a Phase I ESA checklist.

If a site is considered contaminated, a Phase II Environmental Site Assessment may be conducted, ASTM test E1903, a more detailed investigation involving chemical analysis for hazardous substances and/or petroleum hydrocarbons.
If the site has contamination, then Phase III may be issued. Phase III is the actual remediation/removal of the contamination.

Who should have a Phase I performed?

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