Nearly all CMBS lenders obtain a Phase I Environmental Site Assessment report as part of the property diligence process. EMG, an industry leader in delivering Phase I Environmental Assessments and a member of the ASTM E50 Committee, reports that the committee is currently finalizing changes to the E1527 “Standard Practice for Environmental Site Assessments: Phase I Environmental Site Assessment Process,” with an expected release date this fall.
EMG anticipates three key changes.
1. Key Definitions:
* The definitions of Recognized and Historic Recognized Environmental Conditions (REC and HREC, respectively) will be simplified.
* A new definition of “Controlled Recognized Environmental Conditions” (CREC) will be introduced to identify RECs that have been conditionally closed.
2. File Reviews:
* Where applicable, Environmental Professionals will have a duty to consider the significance of available regulatory agency files and provide a rationale if these files are not reviewed. This could result in slightly more File Review recommendations and yield a greater degree of certainty in conclusions.
3. Vapor Encroachment:
* Though Vapor Encroachment and Vapor Intrusion studies will not be required by the standard, Environmental Professionals will be required to consider soil vapor as a potential pathway for the migration of contaminants.