Commercial Property Phase 1 Dry Cleaner

[Kevin Frisenda]

I am a small business owner in the process of buying the building we are established in. Including myself there are 3 office type tenants. 

Today I was contacted by the environmental company I hired to do my Phase 1 and told the property had a dry cleaner about 15 years ago. They are recommending phase 2 research.

I am currently researching issue's associated with dry cleaners and at a crossroads on whether to walk away from the purchase or ask the seller to cover any further research...

Any feedback is greatly appreciated.

[Lawrence P. Schnapf]

studies have shown that 75% to 80% of dry cleaners have leaked. Presumably the dry cleaner uses chlorinated solvents (many now use petroleum-based chemicals which are "greener"). If the seller will let you do a phase 2, you should do it. You'll want to have sub-slab sampling of the soil gas to see if there is a potential for vapor intrusion as well as groundwater.  most sellers are reluctant to allow sampling for fear they will be in worst condition if the buyer finds contamination and then walks. the other question is are you going to finance the acquisition? your lender will likely want a phase 2. What state is the property located? I wrote an article called "Dry Cleaners: The Scourge of Commercial Real Estate" which has alot of info about dry cleaner issues.