8.23.13: Changes Around the Corner for Environmental Site Assessments

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.

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This entry was posted in CMBS, Commercial Lending, Commercial Mortgage-Backed Securities, Commercial Real Estate Loans, Michael D. Sneden, News & Recent Closings, The Banker's Mortgage Conduit, Valuexpress and tagged , , , , , , , . Bookmark the permalink.

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