Pay for an Environmental Phase 2 or Walk Away?

[Suja N.]

I am under contract to buy a commercial building and am planning to convert it to a 20 unit apartment complex.  The environmental phase 1 analysis came back with a number of issues.  The site was once an auto repair shop, across the street was once a dry cleaners, and next door was once a gas station.  The site was also oil-heated in the past.  The phase 2 environmental report is around $15K.   I'm trying to decide whether to get out now or pay for the phase 2 study. This is my first commercial rehab.  I'm wondering if these issues are too potentially serious and I should just get out now or pay to learn about what, if any, remediation would be necessary.  $15K is a large amount of money for me and feels like just flipping a coin.  It is a good deal in a great up-and-coming area but hundreds of thousands of dollars in cleanup would make it a dealbreaker for me.

If I do get a clean phase 2, is there anything else I should be concerned about in the future?  Does it forever taint the property or could there be liabilities that they didn't find with the sampling?   I have a meeting with the environmental engineer later this week and have a lawyer on this transaction but any advice from experienced people out there would be appreciated.