Warehouse and industrial environmental due diligence: what to check
A warehouse is only as clean as the most hazardous tenant it ever had, and industrial buildings change tenants often.
Why warehouses and light industrial buildings carry this risk
Light industrial buildings cycle through users: distribution, small manufacturing, plating, printing, fabrication. Each can bring its own chemicals and leave them behind.
Truck and forklift fueling, battery charging rooms and old rail spurs add petroleum and metals to the list.
What usually turns up
Past manufacturing tenants
Often seriousMetal finishing, plating, printing and electronics used solvents and metals that often show up in soil and groundwater.
Fuel for trucks and forklifts
Worth checkingOnsite diesel tanks, above or below ground, are common in older distribution buildings.
Industrial neighbors
Worth checkingIndustrial parks cluster cleanup sites. A plume from next door can reach your slab.
Rail spurs and fill
Usually minorOld rail lines leave treated ties, metals and fill along the edge of the lot.
What the pre-screen checks for a warehouse
- EPA hazardous waste and enforcement records for every past operator at the address.
- State tank and cleanup lists for the site and the industrial park around it.
- Historical aerials to date the building, rail and outdoor storage.
- Flood zone for the building and loading areas.
Pre-screen a property before you spend on a Phase I
A desk review of one address: past uses from historical photos and maps, federal and state environmental records, and flood risk, ready usually within the hour. $100 for one report, or $100/month for 3.
Questions to ask the seller
- Who were the tenants for the last 30 years, and what did they make or store?
- Any fuel tanks, battery rooms, pits or trench drains?
- Any state cleanup letters or recorded use limits?
- Do current leases make tenants responsible for environmental cleanup at move-out?
When to order a full Phase I
Order a full Phase I on nearly every industrial purchase. The pre-screen helps you price the risk and decide quickly whether to keep going.