By Amy Donohue-Babiak and Tom Gresko

Would it be an overstatement to say that vapor intrusion is the hottest issue in real estate development today? For a real estate developer considering the purchase of a property for development or redevelopment, what’s in the ground may be as important as what can be built on the ground.

Recently, concern has arisen about “vapor intrusion,” the process by which chemicals in contaminated soil or groundwater diffuse upward through the soil, penetrate a building through foundation cracks or other means, intrude into indoor airspaces, and potentially expose occupants to harmful vapors. In response to these concerns, the Environmental Protection Agency (EPA) and state environmental agencies have adopted guidelines and policies addressing vapor intrusion.

Vapor intrusion can lead to costly environmental testing and remediation or building redesign. It can also raise community concerns, and fuel lawsuits involving personal injury and diminished property value claims. How do you ensure that this potential liability is managed in a way that protects both your investment and the health of future building occupants?

First, by focusing on the basics: understanding vapor intrusion, your options for dealing with it, and the potential health risks.

Second, by working with the best professionals available: they can help you decide whether to develop an “at risk” property and how to minimize your potential liabilities.

Background and Risks
Vapor intrusion is a relatively new concern for property owners and developers, and the science is still evolving. The EPA first issued guidance on how to evaluate vapor intrusion risks in 2001. Since then, 39 states have adopted their own regulations, policies or formal or informal operating procedures dealing with vapor intrusion, reflecting a wide range of different approaches to the problem. Not surprisingly, the amount of attention paid to the issue by developers, insurers, lending institutions, community groups and attorneys has also increased.

Some contaminants found in indoor air are known carcinogens or have other effects on human health if inhaled at high enough concentrations over a long enough period. Given the health, legal and economic risks, it is essential to proactively and diligently address vapor intrusion in order to:

• A. Protect future building occupants from potential health threats,
• B. Save time and costs associated with the belated detection of a vapor intrusion problem by addressing the issue early in the process, and
• C. Reduce the risk of lawsuits by neighbors, future building owners, tenants or others who will live or work in the building.

Step 1: Get Smart
In the case of vapor intrusion, action follows education. You need to know where problems are likely to be found, and how your state addresses the issue.

The chemicals that create the potential for vapor intrusion are usually associated with buried wastes, contaminated soil or contaminated groundwater. Therefore, some sites—like Brownfields, former gas stations, former manufacturing facilities, or properties located downgradient from such sites—are more likely to pose problems.

It is also critical to understand your state’s approach to the issue. States vary widely in terms of the methods they require or recommend for evaluating vapor intrusion potential, and in how they assess the risks associated with any level of contamination that is found. Some rely on modeling approaches, some prefer direct indoor air sampling, some have published tables reflecting the target levels of contaminants (e.g., for groundwater, or deep or shallow soils) that they believe to be safe from a vapor intrusion perspective, and some allow evaluators to select from a number of different approaches. In Pennsylvania, for example, a full-scale investigation and assessment of vapor intrusion threats is not always necessary, even for properties believed to be at risk. Prophylactic remediation, via the installation of radon removal-type devices during construction, may be allowed instead, and can save time and money.

Step 2: Get Help
Working with knowledgeable consultants is crucial. Vapor intrusion is uncharted territory for many owners, developers and even regulators. The scientific and legal standards are still in their infancy, and the stakes can be high. If vapor intrusion is a problem at your site, retain technical and legal consultants who understand the process, the risks and pitfalls it presents, and your options and opportunities. When it comes to vapor intrusion, there is no substitute for trusted, experienced professionals.

In retaining technical or legal consultants, consider the following:

• • Do they have experience with vapor intrusion? Owners and developers cannot afford to make mistakes in assessing vapor intrusion potential and risk. Be sure your consultants are experienced. In addition to understanding the regulations and policies that apply in your state and to your project, they must know state regulators’ informal procedures and approaches to vapor intrusion, and how they have been applied to similar properties in the past. Ask potential consultants about their background and experience with vapor intrusion, and get client references, preferably for work conducted in the same state as your project.
  
• • Do they understand the property’s history, geology and hydrogeology, its past and proposed future uses, your goals and plans, and the property’s context within the local community? Simply put, your consultants must do their homework. Every location considered for development offers a unique history and specific challenges, and needs a customized plan. Be wary of anyone who does not take the time to do a comprehensive analysis or who offers a one-size-fits-all approach to vapor intrusion assessment, risk evaluation or remediation.
  
• • Do they take a holistic approach to vapor intrusion? Your consultants should have strong working relationships with the regulators who are responsible for addressing vapor intrusion issues at your site. They should be flexible, creative and thorough in recommending means of assessing or controlling vapor intrusion risks. Technical competence alone is not enough. The challenge is to develop an integrated plan for addressing vapor intrusion that meets regulatory requirements, satisfies community and potential health concerns, and minimizes future liability risks, yet is also cost-effective and meets the time and budget constraints of your particular project.

Conclusion
Vapor intrusion is a relatively new, but increasingly important, environmental concern for property owners and developers. Mismanaged, it can add to development and construction costs, lengthen project schedules, and magnify liability risks. Addressing vapor intrusion early and proactively is therefore essential. If your site poses little or no risk, minimal expense will be incurred. If potential problems do exist, mitigation or remediation may be necessary. However, if assessed and addressed early and properly, vapor intrusion can often be managed in a timely and cost-effective manner, with reduced impact on project budgets or schedules. SLDT