Radon in Commercial Real Estate Due Diligence: Where It Fits in a Phase I ESA

1. What a Phase I ESA actually covers

A Phase I Environmental Site Assessment is the standard environmental due diligence step in a commercial real estate transaction. It follows the ASTM E1527 standard, and its purpose is narrow and specific: to identify recognized environmental conditions, the presence or likely presence of hazardous substances or petroleum products that could pose a release concern at the property. A Phase I is a records review, a site reconnaissance, and interviews. It does not normally involve sampling of any kind.

The reason the standard is built this way is legal. A defensible Phase I helps a buyer establish all appropriate inquiry and qualify for the innocent landowner and related landowner liability protections under CERCLA, the federal Superfund law. Everything the standard requires is oriented around that CERCLA framework, which is exactly where radon runs into a definitional wall.

2. Why radon is a non-scope consideration

Radon is a naturally occurring radioactive gas produced by the decay of uranium in soil and rock. It is not a CERCLA hazardous substance, and it is not a petroleum product. Because the Phase I standard is anchored to those categories, naturally occurring radon falls outside the default scope of work. ASTM E1527 explicitly treats radon as a non-scope consideration: something the standard recognizes a buyer may care about, but that is not part of the baseline inquiry.

This is the single most misunderstood point for buyers new to commercial diligence. Because radon is not a recognized environmental condition under the standard, a consultant is not obligated to surface it, and many reports will note radon only as a non-scope item that the user did not request. If radon matters to you, you have to ask for it.

3. Why radon still matters in due diligence

Radon being out of scope under ASTM E1527 is a statement about a legal standard, not about the building. Radon is the second leading cause of lung cancer in the United States, and elevated indoor levels are a real and measurable health exposure for the people who occupy a building. For a commercial buyer, that exposure attaches to the asset you are about to own.

The diligence case for radon comes down to three things. First, geography: some regions, including much of metro Atlanta, have elevated radon potential. Second, lender requirements: certain financing programs require radon testing regardless of the base Phase I scope. Third, liability and operating cost: a buyer who closes without knowing the radon level can inherit a mitigation expense and a future disclosure or tenant-relations question. Each of those is covered in turn below.

4. Higher-radon geographies and the EPA zone map

Radon potential varies with local geology. The EPA Map of Radon Zones divides counties into three categories, with Zone 1 being the highest predicted indoor average. When a target property sits in a Zone 1 county, the odds of an elevated result are high enough that skipping radon in diligence is a meaningful gap. The map is a screening tool, not a measurement, so it tells you where to pay attention, not what a specific building reads.

For a buyer or environmental consultant, the practical move is to check the radon zone for the property as part of scoping the assessment. If the property is in an elevated zone, that is a strong signal to add radon to the user-defined scope or to line up a separate measurement rather than treating it as optional.

5. When lenders require radon anyway

Even though the base Phase I does not include radon, the lender financing the deal often does. This is most common in multifamily and in agency or government-backed transactions, where the financing program carries its own radon testing requirement that sits on top of, and separate from, the ASTM E1527 work. In those cases the radon scope is driven by the loan, not by the environmental standard.

Because requirements differ by program and change over time, the right first step is to ask the lender directly what radon documentation the loan requires, and frame your assessment scope around the answer. For background on how these programs approach radon, see our guides on HUD radon requirements for multifamily properties and the 2025 Fannie Mae and Freddie Mac radon changes.

6. How to get radon into the assessment

Getting radon covered is simple once you know it is not automatic. The ASTM E1527 report structure lets the user identify non-scope and user-defined items, and a buyer or lender can instruct the environmental consultant to add radon to the scope of work. In practice this is a brief conversation at the kickoff of the engagement, and most environmental firms will price radon screening as an optional line item.

There are two common ways it shows up. The consultant may coordinate the radon measurement themselves through a measurement provider, or they may note radon as a user-defined item and the buyer engages a radon professional directly. Either way, the key is to put radon in writing as part of the agreed scope at the start, so it is not discovered as a gap late in diligence.

7. Ordering a separate radon measurement

Whether it is bundled with the Phase I or arranged on its own, the radon work itself is a measurement, not a desktop review. For commercial and large buildings, testing follows consensus protocols published by ANSI and the American Association of Radon Scientists and Technologists (AARST). A defensible due diligence result references the current ANSI/AARST protocol, uses an appropriate device count and placement for the building, and produces a written report with the measured levels.

Across most US radon programs, 4.0 pCi/L is the common action level. A result at or above that level signals that mitigation should be planned, typically with a sub-slab depressurization system sized for the building, followed by post-mitigation testing to confirm the reduction. For a buyer, a high reading discovered during diligence is far better than one discovered after closing, because it can be factored into price, repair credits, or the decision to proceed.

8. Timing radon in the acquisition deal

Radon measurement runs on a clock. Short-term testing places devices for a set minimum period, after which the devices are analyzed and a report is issued. That means radon has to be scheduled inside the due diligence window, alongside the Phase I and the property condition assessment, so results land before closing rather than after. Bundling radon with the Phase I at engagement is the cleanest way to keep it on schedule.

For an occupied building, the measurement window is planned around tenants, and notification is part of the process. None of this is complicated, but it does need to be sequenced, which is the argument for raising radon at the same time you scope the Phase I.

9. Radon risk in metro Atlanta

Georgia does not have a state radon testing law, which leads some buyers to assume radon is not a local concern. The geology says otherwise. On the EPA Map of Radon Zones, four metro Atlanta counties, Fulton, Cobb, DeKalb, and Gwinnett, are Zone 1, the highest category. Several surrounding north Georgia counties also carry elevated designations driven by the region's granite and uranium-bearing bedrock.

For a commercial buyer acquiring property in metro Atlanta, the combination of no state mandate and genuinely elevated regional radon is exactly the situation where leaving radon out of scope can backfire. Adding it to diligence is inexpensive insurance against a finding you would rather see before you sign than after. For a broader walkthrough, see our commercial radon testing guide and our commercial radon overview.

10. Frequently asked questions