Importance of Environmental Due Diligence

Buying property is not without risks. When you buy industrial, domestic, or commercial property, you own not just the property, but also the environmental liabilities it may have. That's why you need to do some homework before you seal any deals.

What is Environmental Due Diligence? 

Environmental due diligence is a process where land or property is assessed for the possibility of any environmental contamination risks like contamination in soil or groundwater. 

Prospective buyers will need the assistance of environmental consultants to conduct a thorough environmental due diligence assessment to determine whether there is a need to renegotiate the sale or look for better properties elsewhere. 

Reasons for Environmental Due Diligence

There are several reasons why it is essential to have an assessment done. Some of them are:

• After the land has been sold, the buyer assumes the responsibility for cleaning up contaminated land. If the contamination was because of a third party and they cannot be located, the property owner is ultimately responsible. Having an assessment protects buyers from inadvertently assuming environmental liabilities that were not a part of project timelines and costs. 
• An assessment will help ascertain whether there is any contamination and how it affects the project’s prospects for approval for land use. It is important for cases like redeveloping a previous site of a factory for building residential apartments, for example.
• Sites that were previously used but have, for some time, been left derelict – commonly known as brownfield sites – may require clean-up and validation reports before Council approval. Due diligence assessment may involve an asbestos survey.
• A building may dramatically cost more to demolish or renovate if asbestos has been found. In a lot of cases, having an asbestos survey is the most vital part of due diligence. 

Using an asbestos test kit is not recommended as it may put you and your family at risk of asbestos exposure.

If you are considering buying property, it would be to your advantage to hire the services of an environmental consultant and have an environmental due diligence assessment done before you make any final decisions.