Which statement best describes when Phase II Environmental Site Assessment is triggered?

• A. Phase II is always required in CRE deals
• B. Phase II involves sampling if Phase I flags risks; Phase I identifies potential contamination
• C. Phase II is used only for farmland
• D. Phase II is not part of environmental due diligence

Answer: (B)

Phase II is triggered by findings from Phase I. In Phase I, information is gathered through records review, interviews, and a site visit to identify Recognized Environmental Conditions that could indicate contamination or past releases. If Phase I flags risks, a Phase II involves collecting actual samples—soil, groundwater, building materials, or other media—and laboratory analysis to confirm whether contamination exists, determine its extent, and evaluate potential risks to people and the environment. This is why the statement describing sampling when Phase I flags risks and Phase I identifying potential contamination is the best description. Phase II is not automatically required in every commercial real estate deal; it depends on what Phase I uncovers, and it applies to more than farmland. It is part of environmental due diligence because it provides the concrete data needed to assess risk and plan any needed remediation.