More and more commercial and industrial landlords have come to realize that tenant environmental inspections are of key importance, in avoiding surprises at the time of lease termination or at the time of eviction. Companies facing financial difficulties, have higher incidences of improperly storing waste for long periods to avoid costly offsite transportation and disposal costs. In other instances, companies have been found to allow slowly leaking liquids from manufacturing equipment to seep through floors, to avoid equipment repair costs. Due to the cost squeeze now affecting commercial and industrial entities, landlords need to be sure that tenants are not creating or contributing to environmental problems in their demised premises, which will provide a costly surprise to the landlord later.

Many property managers and owners think that lease provisions protect them by prohibiting the storage of hazardous substances on tenant premises. However, the majority of leases used for commercial and industrial space are not enforceable, and, they frequently do not contain any enumeration on hazardous material and waste storage methods, nor specific inspection and spill requirements even though state and federal laws, for decades, have required tenants with more than a few drums of hazardous materials, to have written Contingency Plans in place. In many instances, the plans, if they are present, are not properly implemented, and required inspections are not conducted. The inspections, however, are critical to assuring proper management of hazardous materials and waste, in compliance with federal and state regulations.

Smart landlords have begun to require independent environmental inspections of high risk tenants, including those involved with dry cleaning, automotive or equipment servicing, and those storing significant inventories of chemicals and other drummed or tanked liquids. An inspection by an independent environmental professional can provide quick information on whether storage and management practices are within industry norms, whether they are in compliance with state and federal and environmental laws, and, whether releases are occurring on the tenant premises, which are likely to require future remediation and expenditure of funds.

Experienced environmental professionals can help determine whether conditions in individual tenant spaces are or are not something to be concerned about. Where tenants manage significant quantities of hazardous materials or waste, inspections are recommended at intervals of at least twice per year. The independent pair of eyes can help:

•Determine whether written Contingency Plan is adequate.

•Determine whether the written Contingency Plan inspections are being conducted.

•Determine whether items identified during the in spections are being followed up on.

•Determine whether or not upgraded management practices are needed, either due to the risk involved in managing the materials, or due to the observation of sloppy housekeeping practices, which, if not corrected, will lead to significant clean up costs, at the time of lease termination.

RT has qualified chemical engineers, who can frequently inspect tenant spaces in a few hours, economically. Where new tenants are being considered for a premises and they plan to have significant manufacturing equipment, and/or manage significant quantities of hazardous materials, we can advise landlords and property owners on storage and inspection requirements required by state and federal environmental regulations, which need to be followed. For a free Fact Sheet regarding Contingency Plans, or discuss particular tenant inspection needs, feel free to give us a call at (800) 725-0593.