Environmental due diligence in industrial property agreements

Abstract

Environmental due diligence as a protection mechanism has become very important for many reasons when it comes to real estate transactions. For instance, the parties to a transaction have to establish whether or not the property being considered for purchase is contaminated or not. If the property is indeed contaminated the parties have to decide as to who will bear the remediation costs. Therefore environmental liabilities associated with the property being considered for purchase cannot be underrated. Environmental laws in many countries around the world such as South Africa state that contamination occurred before the new owner took ownership does not absolve either the new or old owner or occupier from being liable for contamination. The main of this research is to look at role environmental due diligence play in South Africa and other countries when concluding real estate agreements concerning property that may be contaminated. The research highlights the importance of environmental due diligence in real estate agreements.