# Phase I environmental assessment

A records-and-site review of a property's history, with no sampling.

For any deal whose real estate ever held fuel, chemicals, or a dry cleaner (gas stations, auto shops, restoration), it is the step that finds the liability buried in the ground before it becomes yours. On an SBA loan secured by commercial property it is required at any loan size when a current or known past use of that property is on the SBA's list of environmentally sensitive industries. A Phase II, sampling soil or groundwater, follows where the Phase I flags a concern, and is required outright on any site that ever had on-site dry cleaning. It is a buyer-side diligence cost and belongs in your [sources and uses](https://searchspheresource.com/glossary/sources-and-uses) beside the legal fee, so the thing worth negotiating is not who pays for it. It is who may RELY on it: a report addressed to one party is not automatically usable by another, and a lender arriving late can require its own unless a reliance letter was asked for at the start.

In numbers: A Phase I on a gas station quoted at $3,500 reads the paper trail. If it flags an old tank, a Phase II quoted at $12,000 samples the ground, and the two together are a tenth of a $155,000 cleanup of an actual leak, which is why it goes first.

Source: https://searchspheresource.com/glossary/phase-i-environmental
Not dated: A definition is editorial: what a term means, why it matters, and an example. None of it reads a source that can go stale, so there is no date to take and a stamped one would be the build time wearing a costume.

Site index for machines: https://searchspheresource.com/llms.txt