Environmental due diligence

Environmental due diligence

Environmental Due Diligence (EDD) is a due diligence process that helps to identify the environmental liabilities or risks prior to acquisition of another business and/or property. Technically with all business transactions, an EDD should be undertaken to protect the best interests of the business and the stakeholders involved in the purchase.

An EDD would general consist of a Preliminary Site Investigation (also known as Phase 1 Environmental Site Assessment) which would include site history assessment and a site inspection. The Preliminary Site Investigation would form the basis of the EDD and depending on the outcomes, the environmental consultant may suggest an intrusive investigation which seeks to provide evidence and information of the actual environmental set up of the property.

An EDD aims at identifying environmental liabilities and risks which can include:

  • The historical use of the site including operation of previous business activities that may result in contaminating the property and/or the surround properties;
  • The surrounding source(s) of contamination that may have an impact on the purpose use of the property;
  • Any fines or penalties that have been applied as a result of violations of local environmental regulations;
  • The potential clean-up costs for legacy environmental liabilities from the historical site uses;
  • The potential removal costs for the disposal of asbestos-containing materials and/or other hazardous materials during demolition for site redevelopment;
  • Potential time delay for property redevelopment.

The duration of an EDD depends on the size and complexity of the property. The depth of the investigation would be decided upon the current and proposed use of the property, financial and time allowance for the EDD, level of access to the information and property, level of permission for intrusive investigation.

Our experienced Environmental Consultants can assist you with all aspects of your land or property purchase.