What Environmental Lawyers Need to Know About CERCLA's Bona Fide Prospective Purchaser Provision - How to Protect Your Clients and Their Companies
- Published: May 2011
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Under Superfund legislation, the innocent landowner
defense has led to the use of environmental site
assessments (ESAs) as a common practice in the
acquisition and financing of commercial property.
The objective of this inquiry was to examine the
effects of environmental risks and liabilities as
disclosed in ESAs in the acquisition and financing
of a set of commercial property transactions in the
Portland, Oregon metropolitan area. The findings
suggest that transaction prices are not reduced in
the structuring of risk and liability. In addition,
financing is likely to revert to seller financing
when environmental risk and liability are present.
Furthermore, the Superfund liability provisions have
led to the mitigation of environmental degradation
in the acquiring of commercial properties with minor
environmental problems while those with more
substantial problems may not be acquired or
financed. Policy implications are posited
addressing brownfield redevelopment issues.
Commercial real estate brokers, attorneys, and
lenders; and professionals in environmental law,
policy, planning, and economics should find this
research useful and enlightening.
Ph.D. in Urban Studies from Portland State University. Associate
Professor at University of Great Falls, Montana.