25
Aug
2004

Managing Contaminated Property

Corporate Counsel

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PUBLISHED ON: August 25, 2004

How do you cost effectively manage environmental liabilities associated with your real estate portfolio? First, do no harm: you need to make sure you are not creating new environmental problems or making existing problems worse, while ensuring continued protection of human health and the environment. With this principle in mind, you can, essentially, hold, lease, sell or donate property which may be tainted by actual or potential environmental (read Superfund or CERCLA) liability.

Where a viable real estate market exists, underperforming property assets ideally should be cleaned up to unrestricted use standards and sold for maximum gain. Another alternative is to sell potentially tainted industrial property to a separate entity with sufficient resources to provide satisfactory indemnity against future regulatory
action. These alternatives sound good, but are not always available.