Asbestos Survey Before Renovating an Apartment Building: What the EPA Rules Require
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Before you renovate or demolish part of an apartment building with five or more units, the EPA's asbestos rule requires the owner or operator to have the affected area thoroughly inspected for asbestos. The rule, the asbestos National Emission Standard for Hazardous Air Pollutants (NESHAP), excludes only residential buildings with four or fewer dwelling units, so an apartment building is a covered "facility" (40 CFR 61.141). If the work will disturb regulated asbestos-containing material above set amounts (260 linear feet on pipes, 160 square feet on other components, or 35 cubic feet), you must notify the state agency or EPA at least 10 working days before the work starts and follow removal and disposal rules (40 CFR 61.145). For a value-add syndication in an older building, that means a survey before the renovation budget is final, and a line for testing, abatement and schedule.
This guide covers what the rule requires, where asbestos hides in apartments, and how to plan for it. It adds to property due diligence and your value-add business plan.
Which buildings are covered?
The rule applies to any "facility", which includes residential buildings but excludes residential buildings having four or fewer dwelling units. A building previously subject to the rule stays covered. In practice, every apartment building a syndication buys (5+ units) is covered.
Asbestos is most likely in buildings built before the 1980s, but some products contained it later, so the rule requires the inspection regardless of age.
What does the rule require?
- Inspect first. Before any demolition or renovation starts, thoroughly inspect the part of the building where the work will happen for asbestos, including nonfriable materials such as floor tile and roofing.
- Notify if over the thresholds. If the work will disturb regulated asbestos-containing material (RACM) of at least 260 linear feet on pipes, 160 square feet on other components or 35 cubic feet, send written notice at least 10 working days before work begins. Update it if the amount changes by 20% or more. Demolition of a facility needs notice even without asbestos.
- Follow work practices. Remove RACM before work that would disturb it, keep it adequately wet, and package and dispose of it as the rule requires.
- Use trained people. The rule requires a trained on-site representative for RACM removal, and most states license asbestos inspectors and abatement contractors.
Many states and local air agencies have taken over the program and use their own notice forms and fees. Check the state's environmental agency before you schedule work.
Where is asbestos found in apartments?
Common suspect materials in older apartment buildings include:
- Textured "popcorn" ceilings
- Old vinyl floor tiles (often 9 x 9 inch) and the mastic under them
- Pipe and boiler insulation in mechanical rooms
- Drywall joint compound and some plasters
- Roofing, siding and window caulking
Only lab testing confirms it. A survey by a licensed inspector samples suspect materials in the areas you will touch.
How to plan for it in a value-add syndication
- Survey in due diligence. Order an asbestos survey of a sample of units and common areas during the due diligence period, focused on the materials your plan will disturb (ceilings, floors, kitchens, bathrooms, mechanical rooms).
- Budget per unit. Turn the survey results into a per-unit cost for abatement where the plan disturbs suspect material, and add schedule time for notices and clearance.
- Tell the contractor. Give the survey to your general contractor and require licensed abatement subcontractors where needed.
- Manage in place where you can. Intact material you are not disturbing can often be left alone under an operations and maintenance program. Ask the inspector.
- Coordinate with lead rules. Buildings old enough for asbestos are usually old enough for lead paint rules too. See lead-based paint rules for apartment buildings.
What should investors see?
State whether a survey was done, what it found and how the renovation budget and schedule account for abatement. Include asbestos in the risk factors for older buildings. See how to read a PPM.
How DoorRaise fits in
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FAQ
Does a Phase I environmental site assessment cover asbestos?
Usually not. A standard Phase I focuses on contamination of the property and treats asbestos as an optional, non-scope item. Order a separate asbestos survey if you will renovate.
Do I need an asbestos survey to repaint units?
If the work disturbs suspect materials, such as scraping a textured ceiling or sanding joint compound, the inspection requirement applies. Ask your inspector what your scope disturbs.
Who is responsible: the owner or the contractor?
The rule applies to the owner or operator of the renovation or demolition activity, which can include both. Make the survey and compliance a contract requirement.
Can the deal company leave asbestos in place?
Intact material that will not be disturbed can often stay, managed under an operations and maintenance plan. Removal is required before work that would disturb regulated material.
Next step: add the survey to your syndication due diligence checklist.
Sources
- 40 CFR 61.141, definitions (facility)
- 40 CFR 61.145, standard for demolition and renovation
- 29 CFR 1926.1101, OSHA asbestos standard for construction
This article is general information, not legal or environmental advice. State and local asbestos rules can be stricter. Talk to a licensed asbestos professional about your building. DoorRaise is not a law firm, broker-dealer, investment adviser or funding portal.