Why do costs of Phase One cost vary so much?

A Phase I inspection is usually conducted prior to financing or selling real estate. The purpose of a Phase I inspection is to determine the probability of environmental impacts caused by current or past usage. These probabilities are not only based on the subject site but extend to property surrounding the subject property. The purpose of a phase I inspection is to determine if conditions exist that pose a hazard to health or to the environment.

During a Phase I inspection, the inspector will conduct a detailed and extensive site visit, as well as gather information about the surrounding area through interviews with neighboring sites. They will also review local government documents regarding past businesses that may have existed long ago but have been torn down. These activities will help the inspector know whether any past uses of the site or any operations in the surrounding area could be or has been an environmental hazard. Generally, there are certain types of properties that have a greater chance of imposing environmental problems. These typically include gas stations, dry cleaners, dumps, or auto repair shops. Certain manufacturing facilities in the past used little discretion in disposing of hazardous wastes and often dumped or buried such materials on their property. Over time, these hazardous materials can spread to adjacent properties and contaminate ground water.

Older buildings, those usually built before 1970 are likely to containing lead paint or asbestos. It is important to note that destructive investigations of building systems and structures are not involved in a Phase I inspection. That is, drilling is not conducted or walls opened up for inspection during a Phase I. A Phase I investigation is usually a part of a general visual inspection and records search to uncover the issues that need further investigation. After the Phase I inspector conducts the site visit and reviews information and local government documents, they will determine whether further investigation is necessary to ensure that the site is not an environmental hazard.

Depending on what is found during a Phase I inspection, a Phase II or Phase III inspection may be necessary. Phase II inspections, also called “subsurface investigations” or “site investigations,” involve testing soil and groundwater for contamination. Phase III inspections involve remediation of the site, if it is necessary.

The cost for a Phase I inspection is quite variable, because not every Phase I inspection is the same. Phase I inspections can involve different activities depending on the site and the client. Some clients may be most interested in whether there is radon present in the building, while others may be more interested in lead, and still others may be more interested in mold. The cost for an inspection also depends on whether further investigation is necessary, and, if it is, what that investigation entails. If a Phase II inspection is needed, factors such as the type of soil present at the site, the depth of groundwater at the site, what operations, if any, were previously conducted at the site, for how long such operations were conducted, and the reason for conducting the Phase II inspection can affect the cost of the inspection. If you want to have a cost-effective Phase I inspection, it is also important to choose a qualified and responsible consultant to help you through the process.

As with any important purchasing decision, get several estimates. Ask for references and talk to several clients who have worked with the prospective Phase I Investigation Company.