Phase 1 Environmental

[washregal]

I am looking at purchasing (2) car wash's that I have been under a lease purchase for for the past several years.

My question is this.. What do Phase 1 environmental check for? Should I have my pits pumped prior to any phase 1 study?

 

[Earl Weiss]

Phase 1 is a historical analysis to see if their might be a problem. If their might be one then a phase 2 is needed. HAd an idiot banker say at the last minute they needed a phase one. I had already given him one along with the phase 2. remediation plan and an NFR letter. It was an active gas station. He said the stuff was ove 3 years old and they needed a new one. He had no idea what he was talking about . Just reading from a check list. If anything they needed a current phase 2. Luckily they had no $ so would not make the loan. Lucky because i took the document package to another lender and closed the loan in 30 days at a better rate.

Lesson - Choose lenders wisely.

 

[rph9168]

If a seller is really serious about selling they should have a Phase One done and any follow up work that is required done. I have seen several car wash deals fall apart due to the lack of a Phase One that ended up killing the deal when problems were spotted when one was done. I do agree about the inconsistency of banks in making sure all the proper documents are in place. I have also seen some deals go through without a Phase One or other important documents create some serious problems that were discovered later on. This is why I always recommend both the seller and buyer have lawyers involved in the transaction and not trust the lender to have all the proper paperwork in place.

 

[Earl Weiss]

If a seller is really serious about selling they should have a Phase One done .....

I beg to differ. This is one of many points of negotiation. Have done deals where Seller pay, Buyer pays, they split the cost, Buyer pays but if there is a potential issue and deal fails Seller will then need it for the next deal and pays half and gets it.