Question on foreclosure sale of commercial property
I am considering purchase of a commercial property but I have some concerns about whether there may be a soil contamination issue on the lot.  The seller's agent claims that seller is not required to provide the standard disclosures since it is a foreclosure sale.  My question is whether this is, in fact, a foreclosure sale.

The property was foreclosed on a few years ago by an asset management company.   The asset management company was subsequently acquired by GE Capital, who is now selling the property.  Is this actually a foreclosure sale?  (If so, GE Capital apparently has the right not to disclose any info they may have about contamination of the property.)

I'm sorry if this is the wrong subreddit to be posting this question to.
[{"id": "chpmhtg", "text": "You may want to take upon yourself to order a Phase I environmental soils report.  If you don't, a prospective lender will almost certainly order one.  Better to find out sooner than later.", "replies": [{"id": "chpstjt", "text": "I've already ordered a Phase 1 Environmental Site Assessment, but I don't think it includes soil testing, which is part of the Phase 2 ESA.", "replies": [], "depth": 2}], "depth": 1}, {"id": "chpptwn", "text": "Absolutely do a Phase 1 Environmental Assessment if you plan to buy. Here in the greater Tampa area it costs about $1500 for properties under one acre.\n\nIf you take on a property that has environmental problems without out the proper due diligence (generally considered a Phase 1), you may be taking on significant liability. For more information look up the CERCLA regulations.", "replies": [], "depth": 1}, {"id": "chppuxz", "text": "Well first of all as Wayan_nz suggested if you order a phase I - then I would. Secondly you can get whats called a transaction Screen - which would essentially pull up any recorded environmental issues with the property filed with public agencies - this can be done in a few days and costs a few hundred dollars. However - lets say you cannot get a phase I  - then lets use some logic - if it was foreclosed upon that implies there was in fact a loan on the property at some point. Who was the loan with? Was it a FDIC regulated bank? If so, you can almost be positive that they ordered a Phase I prior to lending on the property and they would not have if it was contaminated. \nOk - but what if the contamination was done after the loan was originated? Is that likely - what was the use? anyway back to Phase I - there is a reason it is a basic part of any CRE DD.", "replies": [{"id": "chpubm7", "text": "The Phase 1 ESA I've ordered includes a records search.  I was not aware of a Transaction Screen but I will look into it.\n\nYou ask some good questions Zeno, so let me tell you a bit more about the property...\n\nThe property was a gas station from about 1950 to 1980 (hence my suspicion of contamination), and a restaurant from 1990 to 2010.  From the records I found at Oregon Dept of Environmental Quality (DEQ), there were 4 tanks on the property, which were decommissioned in 1988.  DEQ shows tank status of all 4 as \"REMOVED\", but we suspect that they may still be in the ground (the Phase 1 ESA will tell us for sure).  I think it's very likely that the Phase 1 will indicate need for a Phase 2 ESA, but GE Capital will not allow us to perform a phase 2 (obviously a big red flag).  Maybe they know something.  Maybe they just don't want to know.\n\nThe owner who was foreclosed on bought the property in 1998.  I don't know what kind of environmental surveys they would have had to do back then.  I have not been able to determine who the original lender was, but I will investigate.\n\nOther notes:\n\n* We have made a cash offer, so are not technically required to do phase 1/2 ESAs by a lender.  We are doing the phase 1 as part of our normal due diligence.\n\n* Some soil contamination probably wouldn't be the end of the world.  We plan to use the property basically \"as is\" for the next few years.  If we decide to develop it down the road, a $50k cleanup would be a bummer but it won't ruin us.  We think the property is a decent value even if that kind of cleanup is required down the road.  (A $200K cleanup would be another story.)\n\nGE Capital may know that there is extensive soil contamination at the site (perhaps they already did a phase 2?), but is not required to disclose it since they consider this a foreclosure sale.  Hence my original question:  \n Is it actually a foreclosure sale if the current owner came to possess the property by buying out another company (which had foreclosed on someone)? \n", "replies": [{"id": "chsrbr2", "text": "If it was a gas station in the 50's and 60's you definitely should consult a good RE attorney in your state.  He will likely recommend you spring for the soil sample to mitigate risk.", "replies": [], "depth": 3}, {"id": "chv1jt5", "text": "The Phase 1 will not tell you whether the tanks are there. The Phase 1 will say order a Phase 2 and do x y z, which probably will consist of soil borings, and possibly using ground penetrating radar over the suspected tank locations to determine if they are still there. You're looking at $10 - $25 grand for this kind of Phase 2.  \nSource: I did workouts on a bunch of shitty old gas stations and had to order tons of Phase 1's that recommended Phase 2's. ", "replies": [], "depth": 3}], "depth": 2}], "depth": 1}, {"id": "chpz696", "text": "If there is petroleum contamination, it's very possible that it has spread past your site to other properties and into the ground water. You should consult an attorney about your assumption of that risk. ", "replies": [], "depth": 1}]