New Industry Standard for the Assessment of Vapor Intrustion into Structures on Property Involved in Real Estate Transactions
Parties engaged in real property transactions, mergers and acquisitions, and real property development should be aware that in March 2008, ASTM International (originally known as the American Society for Testing and Materials) released a standard, numbered E-2600-08, that defines good commercial and customary practice in the US for conducting a vapor intrusion assessment ("VIA") on a parcel of property involved in a real estate transaction. The purpose of a VIA is to determine whether subsurface chemicals may be migrating as vapors from contaminated soil or groundwater on the property (or within close proximity to the property) into existing or planned structures on the property. While neither the US Environmental Protection Agency nor the Oregon Department of Environmental Quality currently requires the implementation of VIAs as an element of Phase I environmental site assessments ("ESAs"), lenders will likely require them in the future to eliminate the possibility of an unacceptable risk to humans at the property.
ESAs are "above-ground" property inspections that include a review of the property's historical use, ownership and aerial photographs, a site visit, and interviews of owners and local government officials, but do not involve testing the soil or groundwater. They are standard practice in real estate transactions because they allow purchasers of real property (assuming the ESAs are performed correctly) to claim one of the three protections, so called "innocent purchaser" defenses, available against potential CERCLA (or "Superfund") claims. Consequently, if VIAs are going to become a required component of Phase I ESAs, environmental due diligence in real estate transactions will likely become more costly and time-intensive.
Post authored by Jeanette Schuster, attorney practicing in the Sustainability and Real Estate and Land Use Groups.
