By Larry N. Murnane.
The Environmental Protection Agency recently established enhanced Environmental Due Diligence requirements for individuals and entities purchasing commercial real estate. In order to qualify as an “Innocent Landowner” and thereby avoid liability for previous environmental events on or about the property, a purchaser of real estate now must obtain an AAI (All Appropriate Inquiries) Compliant Phase I Environmental Site Assessment prepared (or updated) within six months prior to the purchase.

The scope of the AAI Compliant Phase I and the experience/licensing requirements for the person completing the report have also increased significantly, causing the cost of the report to increase as well.

In short, buyers who rely on out-dated Phase I reports which are not AAI Compliant risk liability for prior contamination.

By Larry N. Murnane.
Almost everyone is familiar with the three cardinal rules of real estate investment: “Location, Location and Location.”  Although property well situated certainly has fewer risks, an investor must carefully consider other ways to minimize the risks involved in the purchase of commercial real estate.
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