Always do a Phase I?

Hi, I heard through the grapevine that Dave never does Phase I reports on his parks. Not sure if that is true, but it got me wondering if I really need to as Frank and Dave’s documents all clearly say that we do. Can I get a history of the property instead? Other alternatives? Just take my chances? The park in question is in a small town, 40 miles from a big town in Iowa and surrounded by corn fields.


Dave and I have NEVER purchased a property without a Phase I (except in the early days when we didn’t even know what one was). You are certifiably crazy if you don’t obtain a Phase I on every property you buy, during the due diligence phase. An environmental clean-up can be in the millions – way too much risk to save the $2,000 that the report costs.

Being surrounded by corn fields does not mean that you are not a technical “landfill”, or that pollutants were not dumped on the site. Look up the Potosi Lead Mountain in Missouri, about an hour from my house. This is one of the largest contamination sites in the U.S., so big that the U.S. government cannot afford to fix it. It took 100 years to build it using lead waste from railroad cars being continually dumped there. It would take about 100 years to remove it. And it looks like a peaceful hill in the Ozarks.

Ok, that is crystal clear! I already ordered and scheduled my Phase I, so I’m good.

Thanks Frank!



I’m looking at a park that is being auctioned through a private auction company next month. They have some basic financials on the park, but no survey or Phase 1 information. If I win the auction, I’m required to put up non-refundable money. Would you guys just stay away from purchasing a deal like this if you didn’t have Phase 1 or survey information prior to the auction?

Everything else checks out on the deal: city utilities, rents under market, located in major US market, no flood plain issues