Standing Out in Ohio Podcast
Listen and learn how some stand out from competition and gain market share. Information helpful to agents and buyers. Conversations with professionals and entrepreneurs regarding their stories and what makes their companies and themselves stand out and gain competitive advantages. Listen to stories from Ohio real estate agents and related businesses to help you know how to improve and who to consider using for yourself or friends. Created by the owners of a highly rated home inspection company in Ohio and the Winners of Best Home Inspection Company in the Midwest https://homeinspectionsinohio.com/
Standing Out in Ohio Podcast
Insights into the ESA Process for Property Transactions
This episode focuses on the critical importance of Phase One Environmental Site Assessments (ESAs) for real estate investors and banks. We explore how these inspections help uncover potential environmental risks associated with properties, safeguarding investments and ensuring compliance.
• Importance of Phase One Environmental Site Assessments
• Process and timeline of completing a Phase One ESA
• Record reviews and site visit significance
• Identifying contamination indicators during inspections
• Differences between Phase One and Phase Two assessments
• Real-life examples of Phase One inspections
• Importance of due diligence in property transactions
• Call to Action: Contact us for commercial and residential phase one inspections
To learn more about Habitation Investigation, the Two-time Winner of the Best Home Inspection Company in the Midwest Plus the Winner of Consumer Choice Award for Columbus Ohio visit Home Inspection Columbus Ohio - Habitation Investigation (homeinspectionsinohio.com)
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Welcome to the Standing Out in Ohio podcast, where we discuss topics, upcoming events, news and predictions with real estate professionals and entrepreneurs. Listen and learn what makes their companies and themselves stand out and gain advantages over the competition and gain market share. Subscribe for the latest news and discussion on what it takes to stand out from the crowd. Now here's your host, jim.
Speaker 2:Hey everybody, Welcome to the Standing Out how Podcast Jim and Laura here.
Speaker 3:Hello everyone. Okay, laura so continuation of the last podcast.
Speaker 2:This is a previous podcast, we're going to talk about this one phase one inspections For commercial property inspections. Well typically yeah, For commercial properties. If you're a residential real estate agent, you might be going yeah, phase one, that pre-drywall. Nope, this is a different one. This is phase one, environmental site assessments, phase one, esa.
Speaker 4:But first let's listen to this Habitation investigation is the way to go for a home inspection in Ohio. Trusted licensed home inspectors for your needs. From radon to mold to warranties For a great home inspection, you really can't go wrong. Visit homeinspectionsinohiocom.
Speaker 2:All right, laura. Environmental site assessment phase one why do banks want this done?
Speaker 3:Because banks do not want to have to pay for cleanup if they find out that there's an environmental contamination there that would require some type of cleanup. Oil, petroleum products.
Speaker 2:I'm a bank. You're buying dry cleaners. Yeah, you're buying a dry cleaner.
Speaker 3:Phase two automatically requires.
Speaker 2:There's a lot of chemicals in dry cleaners that they use, yeah. So as a bank, I want you to get a phase one done, because if you ever default on that loan and I take possession of that property, you're not going to. I'm like holy shit. They've been dumping oil and all kinds of weird stuff in the ground for decades. I don't want to pay for that cleanup.
Speaker 3:Right.
Speaker 2:So I would say, hey, get this phase one done. I'll look at it and go cool, nothing crazy on here. There's no contamination. We're good to go. I feel good about giving you the loan.
Speaker 3:Or this has a phase two recommended. Y'all need to be following up on this, because right now you're not getting the money.
Speaker 2:So phase one what's involved in it?
Speaker 3:Phase one is a lot of record review.
Speaker 2:So it's not like you order it today and you have it tonight.
Speaker 3:No, I tend to do mine a little faster because usually when people contact me they want it within a month. Average time is like three to four weeks to get those done.
Speaker 2:three to four, and this is one thing I like about commercial it's not immediate time frame, like I love commercial companies. Well, buyers, call it hey, I need a commercial inspection for this, this warehouse or this restaurant and then a month later in the proposal we write from like okay we don't hear anything more like all right, maybe they didn't get it. Yeah, three weeks a month later, hey, we're ready to schedule that.
Speaker 3:Oh, okay, it's a different time frame, it's a different business, it's definitely more professional.
Speaker 2:People don't get stressed out.
Speaker 3:Because it's a money thing, does it make good business sense. There's not much emotion involved. No, no much.
Speaker 2:So we know why a bank would want the phase one done. And you said it takes like three weeks to a month to get it done.
Speaker 3:It can take up to a week to get the records pulled.
Speaker 2:Just a record pull. Just a record pull is about a week, so what records?
Speaker 3:So they'll go through federal, state, local databases. They're going to look for any evidence of like underground storage tanks, any evidence of any leaking underground storage tanks. Is there anything that has been investigated in that area in terms of environmental contamination? They'll look over things like that. And then, how close was it to the property? Was the property actually listed as an area of concern?
Speaker 2:So it's not just that address, is the buildings next to them as well, and maybe depending upon geography, you know, like, how, how does stuff flow?
Speaker 3:Did you have a chemical?
Speaker 2:plant uphill that that was leaking like a sieve All those chemicals down to your backyard.
Speaker 3:Right Of your building, something like that.
Speaker 2:So we know why phase one would be ordered because the bank doesn't want to be on the hook for it.
Speaker 3:Right.
Speaker 2:And she got to do the record pull. That takes a while, but after that you you have to read all those reports and then some summarize.
Speaker 3:so the reports need read and summarized. Usually the way I do it is I will make a quick, easy chart, so just the stuff that's mentioned in the record pool. If there's anything that comes up that goes into the chart and if it's not listed then you know doesn't need it that's a chart you created yes okay so um then there's also a site visit yes, and I almost go out.
Speaker 3:Yeah, yes, so we go out, we tag team. Is there water anywhere on the property? Does the water look oily, like it's got oil on it? Is there an area of grass that's not growing correctly? Is the grass dead? Is the grass even able to grow?
Speaker 2:If you've got an area where the grass is dead why that's not good what is going on. That last one we went to there was a mud puddle in the grass. It had oily scum on it.
Speaker 3:It was like a drain that had oily scum on it, and then right beside that drain there was a strip of land that didn't have grass on it and it was like all brown and dead. And then the strip right beside it had grass. So no grass was growing here, just like dead weeds and then grass. So, what's growing? What's right here? That's not letting that grass be growing, so that one required a phase two, all right.
Speaker 2:So you do the phase one, because bank doesn't want to be on the hook. Bank doesn't want to be on the hook. Bank doesn't want to be on the hook In case they somehow own the property themselves. They don't want that. Yeah, and so you do do the database research with a site visit.
Speaker 3:we find nothing there's so there's no recommendation for anything else to be done so that was like that one condo um, the, the, that one apartment complex that had like the five buildings, like, oh, they're like 200 units in this thing no, no, no, not the one I'm thinking of.
Speaker 3:the one I'm thinking of the. The guys commercial company built them and he decided, like he'd been building them all around Columbus. And then he decided, well, what the hell, why am I selling these? Why don't I just keep a couple and rent them out? So he had several of these that he had rented over the years and then he was starting to sell them off. They were only ever residential, they were only near residential.
Speaker 2:So they were clean.
Speaker 3:That was the cleanest phase one I've ever done, so at that point nothing.
Speaker 2:It's like a green flag for the bag. My guilt early, good, yeah, everything was so you go for it.
Speaker 3:All right, so man with that trucking company oh fireplace down by the river the river very first phase one assessment.
Speaker 2:I had to do so so this one, this was bad. It was bad. I mean, you walk around and we're seeing 55 gallon steel drums of like oil overflowing, leaking onto the ground.
Speaker 3:Batteries left around.
Speaker 2:Yeah, leaking batteries. A homeless guy living in the which, not an environmental hazard but we got. You got a homeless guy living in this car, in this.
Speaker 3:Sandblaster area.
Speaker 2:Yeah, oh, sandblast and had all that silica everywhere, which I don't know if that's an environmental hazard by itself, but no, you should not be breathing that stuff in there it is. It's exposed to the wind. There were a lot of issues in that place and it was near the river yes, a major and river what I love best about this is that area had been in violation but from the fda, from the fd, from the epa, like years, years ago took them years to get back into compliance.
Speaker 3:I mean clean to get cleaned and then, guess what, they were never checked on again. So, like I'm coming in and doing this like 20 years later and there's been no follow-up, they just reverted back to their old practices. Everything was just leaking all over the place. They had just trash all over the place with oozing oil and this and that, and so. That was a phase two.
Speaker 2:Or another one we recently did or you did. We get there to the site, we see little scummy things, but the big red flag that it should have a phase two Is the history of this place.
Speaker 3:Yeah. Cause we don't want to get too much into that, because that could narrow it down but anyway.
Speaker 2:So the history is very important. You got all the databases, all that. So say we. You find something, something pops up on the database or something we observe, and they have to do a phase two. What is a phase two?
Speaker 3:so phase two is a deeper record dive and actual testing. Now I don't know how much a phase two itself costs, but I have been told that sampling can be up to a thousand a sample well, we have charged people that much for samples, depending upon the water quality testing they're doing Right. Well, yeah. But phase two you're going to need more than one, yeah you're going to eat, so you.
Speaker 3:This can involve uh material sampling like you grab a chunk of material, send it for asbestos testing maybe right, you drill up, you do soil, you do water testing um soil testing mean you dig down, dig down, send it to the lab now I, I think for, like the phase twos, I think it can go down to like 10 feet because, like I, I know some places where they've replaced like up to eight foot of dirt because that first seven and a half foot was contaminated yeah and I.
Speaker 2:If you do a soil testing for like gardening, it's like eight inches is all you need to go down to something good, so not not not a very deep mountain you need to go to, but man I'm thinking I'm thinking that garage and oil just sitting there. They need to go deep. They probably have to go.
Speaker 3:Keep digging down all right till they hit nothing and see how far down that is, and then, yeah, so it's, it's definitely interesting to look over and learn about the property and and see where things are yeah and not, and not just anybody can do a phase one inspection there is certification certification is a long process.
Speaker 2:Laura, being awesome, has that, so she can do that, and of course, she has experience and I, and actually you, consult with other people who do that for other companies. Right, it's strictly environmental companies, right?
Speaker 3:Right, I do the phase one, so there's another company that's out west.
Speaker 2:They double check your stuff in there.
Speaker 3:Well, and there's another company out west that I've done consulting for, so they'll do the phase one, but I do the site visits for them and I fill out that part of the paperwork for them.
Speaker 2:Yep. So I've done that, you've done quite a few of those, I've done quite a few for those. So if you yourself or some of your clients is buying a commercial property, have them contact us. We can do the inspection on that and then do the phase one.
Speaker 3:We give a discount.
Speaker 2:We're doing the phase one, along with the inspection.
Speaker 3:for that there's a discount for that, because we can definitely save it. We'll just do it all in one visit, which makes it a little bit easier for everybody involved. That's all that works.
Speaker 2:That's phase one. These are phase two. Is there a phase three?
Speaker 3:No, I do have a company that I can recommend for the phase two, the one that I've been doing the consulting for from Out West. They do phase twos.
Speaker 2:So the phase two. Then all right, test it. We find some shit, clean it up and then probably the testing for the confirmation has been cleaned up.
Speaker 3:I don't think the cleanup is going to happen that fast. I think what ends up happening is they do the testing and, depending on what comes back, then the EPA would get involved. Then the EPA would get involved. So if something comes back and it comes back hot, there's a problem. The EPA has to be involved. And then they have to create some kind of a plan, and I bet there's more testing then, because exactly how deep does that oil spill go? Because then what they do is they will literally come in and they'll take out feet upon feet of dirt and haul it somewhere where it gets cleansed or stored or whatever there are bacteria you can put in the soil.
Speaker 2:that would eat the oil, right. So there are bacteria. You can stick in there and clean it up, but it's not well. The government's not known for being fast and efficient, so I imagine cleanup would take quite a while to do that yeah well, remember that. Well, that lady, that who's gonna buy that first one, the one by the river right, she wasn't gonna do a phase one no, her bank didn't give her a choice her bank. Her bank told her to. Is that?
Speaker 3:right, yeah.
Speaker 2:Okay, that's a good thing, because she was, she would have been. She had a coach. She had a coach trying to get, help her to learn how to invest in commercial property.
Speaker 3:Right and he wasn't.
Speaker 2:He didn't say anything about the phase ones, the bank required her to get one, the bank required she's lucky, because that would have been crazy, that would have been bad. It would have been expensive for her and it would have been hers. Oh yeah, yep, so I think that's it for this one, right, you can think of anything else.
Speaker 3:I can't think of anything else.
Speaker 2:Definitely contact us for commercial residential phase ones, environmental testing. We can do that so everybody feels comfortable with their buying decision. So, yep, I think that's about it. Thank you everybody. Bye.
Speaker 1:You've been listening to the Standing Out in Ohio podcast. Be sure to subscribe on Spotify or Google Podcasts to get new, fresh episodes. For more, please follow us on Instagram, twitter and Facebook, or visit the website of the best Ohio home inspection company at homeinspectionsinohiocom or jimtroffcom. That's J-I-M-T-R-O-T-H and click on podcast. Until next time. Learn and go do stuff.