Environmental Due Diligence

Does A Phase 1 Have To Be Issued To The Person Seeking To Comply With AAI?

CERCLA, Corporate and Real Estate Transactions, Environmental Due Diligence /

Purchasers who want to be able to assert the CERCLA Bona Fide Prospective Purchaser (BFPP), Innocent Landowner (ILO) or Continuous Property Owner (CPO) landowner liability protections (LLPs) need to conduct a pre-acquisition investigation that complies with EPA’s All Appropriate Inquires (AAI) rule. A question that is surfacing with surprising frequency is if the phase 1 […]

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Bankruptcy Courts Rules Bank May Not Seek Cost Recovery for Contaminated Site Purchased in Auction Sale

consultant malpractice, Corporate and Real Estate Transactions, Disclosure of Environmental Liabilities, Environmental Due Diligence, Hazardous Waste, Lender Liability /

Pete Seeger’s popular song from the 1960s “Where have all the Flowers Gone?” has the haunting recurring lyrics “When will they ever learn”. This song came to mind when we came across another case of a bank taking title to contaminated property without doing any environmental due diligence. In this case, Suburban Bank and Trust

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EB-5 Program Can Provide Alternative Source of Funding for Brownfield Projects

Brownfields, Disclosure of Environmental Liabilities, Environmental Due Diligence /

In a prior post, we discussed how the EB-5 visa immigrant investor program was becoming an important source of construction funding. Since then, the EB-5 immigrant investor program has continued to undergo explosive growth. The popularity of EB-5 is partially because traditional forms of project financing remains difficult to obtain. However, the EB-5 program is

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Cal Appeals Ct Affirms $2MM judgment against foreclosing bank for failure to complete remediation is

common law, Corporate and Real Estate Transactions, Environmental Due Diligence, Lender Liability, vapor intrusion /

The foreclosing lender in Hoang v. California Pacific Bank, 2014 Cal. App. Unpub. LEXIS 5230 (July 23, 2014) made some curious decisions and the result was the bank was ordered to pay damages to the purchaser that exceed the sales price of the property. The irony is that the lender probably complied with the CERCLA

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CMBS Environmental Due Diligence Needs to Consider B-Piece Buyers

Environmental Due Diligence /

Commercial Mortgage-Backed Securities (CMBS) loans have been playing an increasingly important role in commercial real estate financing and account for around 30% of commercial loan originations. Because of the increasing use of CMBS loans, it is important for consultants to understand the different risk tolerances of the players in a CMBS transaction and how environmental

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Rep and Warranty Insurance Becoming More Common in M&A Deals

Corporate and Real Estate Transactions, Disclosure of Environmental Liabilities, Environmental Due Diligence, environmental insurance /

The use of reps and warranties insurance (RWI) is becoming an increasingly popular risk allocation tool in corporate transactions. According to trade press reports, the volume of RWI doubled from 2011 to 2012, with the value of the insurance bound last year exceeding $4 billion. RWI covers losses related to breaches or inaccuracies in reps

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Major CMBS Lender Requiring EPs to Perform Site Inspections

Corporate and Real Estate Transactions, Environmental Due Diligence, Lender Liability /

We have previously discussed discussed here and in other forums how the All Appropriate Inquiries (AAI) Rule issued by EPA in 2005 is deeply flawed and has directly contributed to a worsening in the quality of phase 1 reports. This is ironic outcome since the reason EPA was instructed in the  2002 amendments to CERCLA  to issue

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Environmental Restrictions Now Fully Enforceable by NYC DOB

Corporate and Real Estate Transactions, Environmental Due Diligence, NYC OER /

In June, the NYC Department of Buildings (DOB) completed uploading into its Buildings Information System (BIS) approximately 200 Restrictive Declarations (RD) that can impose certain environmental obligations relating to hazardous materials. This action means that parties seeking building permits and certificates of occupancy for sites subject to RDs will have to demonstrate they have satisfied

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Kiddie Kollege Ruling Highlights Importance of Performing PAs in NJ Transactions

Corporate and Real Estate Transactions, Environmental Due Diligence, NJ Spill Act /

Nearly eight years after a New Jersey day care was forced to close down because of mercury contamination, the legal fallout continues.  In the latest legal salvo involving the infamous Kiddie Kollege Daycare & Preschool, Inc, (Kiddie Kollege), a New Jersey trial court ordered the current property owner who leased the contaminated building to the

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Problems Emerge with New CREC Definition

Brownfields, CERCLA, consultant malpractice, Corporate and Real Estate Transactions, Environmental Due Diligence, Lender Liability, vapor intrusion /

After a little more than six months after ASTM issued its new E1527-13 Phase 1 standard practice, problems are emerging over the new definition Controlled Recognized Environmental Condition (CREC) definition. The difficulties are related to the definition itself and differences among state environmental programs. Before discussing the CREC problems, a little background might be helpful

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