Simulation: a fictional property for practice.

A small warehouse that used to be a repair shop

A well-priced warehouse once housed an auto repair business. Before you buy, find out what’s in the ground.

A fictional industrial building. Federal environmental rules apply in every state.

• Price: $900,000
• History: An auto repair shop for 20 years; floor drains in the old service bays
• Use you plan: Lease it to a contractor for storage
• Your lender: Requires an environmental report

Mission 1: The environmental report

What do you order, and when?

• A Phase I environmental site assessment (ASTM E1527-21) completed within one year before I take title, with its site visit, interviews and record searches within 180 days
• Skip it: the seller says there’s never been a problem
• Order one after closing

Old repair shops, gas stations and dry cleaners are classic sources of contamination: oil, solvents and buried tanks.

Mission 2: The Phase I finds a problem

The report flags the floor drains as a “recognized environmental condition.” What do you do? Pick all that apply.

• Ask the environmental professional about a Phase II: sampling soil and groundwater
• Use the contract’s due-diligence period to renegotiate or cancel
• Close on schedule and deal with it later

Talk with a real estate attorney about the environmental terms in your contract before you sign it.

What do you do now?

Buy, investigate or pass? Work through the drill to see what an experienced investor would weigh.