by Cliff Ford
In July 2011 the environmental laws were updated, resulting in a tougher process for those owners who – often through no fault of their own – found themselves owning a property that could not be sold due to environmental issues. Whether it be from a buried oil tank, asbestos, heavy metal deposits, mould, water table pollution, or other environmental concerns, many owners who were looking to sell their properties found that they would have a problem in doing so.
Skyview Realty is finding that since the updated environmental laws took effect, there has been a significant increase in the amount of transactions that need special attention from an environmental perspective. In fact, close to 40% of all properties that Skyview has sold in the past year had an environmental issue that needed a resolution in order for the property to change hands successfully. In every case, a solution was found and Skyview’s developing expertise made that possible.
OIL TANKS - In the majority of the 40%, it was found that underground oil tanks were in need of removal to rectify the environmental concern. In previously published ‘Skyviews’ articles, Skyview Realty documented the evolving environmental laws as they related to underground oil tanks. Although the legislation in 2011 changed and mandated that all underground oil tanks be removed, we are still finding properties that have a buried tank. In these cases, inspections were conducted to determine the best course of action for removing the tanks, and if there was oil leakage into the surrounding soil. The oil tanks were removed, and where needed, Skyview’s contacts were able to remove the affected soil when oil had leaked from the tank. Skyview is looking for the indicators upon its first inspection of a property to ascertain if an underground storage tank exists. This dramatically speeds up the selling process.
DRY CLEANERS/GAS STATIONS – Neighbouring properties are now a big concern. In one transaction it was found that a local dry cleaner was placing contaminants into the sewer system which contaminated the water table around the property. Though the property was deemed to be an environmental concern, Skyview Realty was able to find an all cash buyer at a discounted price. Skyview Realty is discovering through this process, that there is potential to put financing in place even on these types of properties.
ASBESTOS - One property was found to have multiple concerns including an underground storage tank and asbestos in the boiler room. Skyview attempted to identify the problems in the infancy stage of the transaction and put processes into place to handle the problems even before a buyer was introduced to the property, so the concerns could be alleviated and the transaction could close in a shorter period of time.
RAILWAY BACKFILL - Another property was known in advance to have contamination of heavy metals in the soil from a nearby railway line. It was understood that in the 1950’s some railway lands were backfilled with materials now deemed to be contaminated. Skyview Realty worked with all parties to identify the issue and obtain cost estimates before finding the cash buyer who was willing to purchase the property ‘as is’ with a reasonable discounted price.
MOULD - Another property was discovered to have mould issues inside a number of the suites as well as in some common areas. Skyview Realty worked with a team of experts to identify the issues, and coordinate the contractors, on behalf of the Vendor, to remediate the mould prior to closing.
When selling properties with environmental concerns, all parties need to manage their expectations. Dealing with an environmental issue can result in a longer conditional period and additional monies spent in the cleanup. Both parties need to understand the realistic timelines and budget for handling the environmental issues on a property. If communication is done properly, both parties can walk away on closing day without any surprises and with a good taste in their mouth.
If you have the potential of an environmental concern on your property, the solution is often a matter of partnering with the right people, ensuring the work is completed properly and in a timely fashion. With Skyview Realty on your side, and proper communication between all parties, no property should be deemed impossible to sell.