Environmental Issues: Buying a NY or NJ Car Wash/Gas Station | Internicola Law Firm

Buying A NY Or NJ Car Wash Or Gas Station

Buying a New York or New Jersey Car Wash or Gas Station: Dealing With Environmental Issues

Learn About Environmental Contract Contingencies and Assessments

In both New York and New Jersey, the purchase of a gas station or car wash involves the acquisition of rights (whether purchasing or leasing) in property that may have a history of ground contamination. The reality is that the many existing gas stations and car washes (including the car wash or gas station that you may be buying) possess histories of ground contamination. If the property is contaminated, you must understand the nature of the contamination the potential need for remediation and, most importantly, whether or not the contamination will require future abatement that will interfere with or possible shut down your newly purchased business. Even if you are just leasing the property or possess environmental contamination insurance, obtaining an environmental site assessment / Phase I Study is a necessary component to your pre-purchase due diligence.

Steps to Take

When purchasing a Gas Station or Car Wash in New York or New Jersey, some important environmental due diligence factors to consider, include:

Make Sure your Purchase Agreement includes an “Environmental Contingency Clause”

When purchasing a business you will be faced with a number of critical issues that must be decided in a relatively short period of time. However, when investing your life savings in a business, time constraints are not an excuse for shortcuts. An environmental Contingency Clause will allow you to enter into and sign a purchase agreement and still give you time to complete your due diligence evaluation of the property’s environmental history. For example, an environmental contingency clause could be structured to so that, after contract signing, you are given an additional period of time to obtain an environmental site assessment and complete your due diligence. If contamination is discovered, your contingency clause could be structured to let you cancel the contract and get your deposit back or require the seller to remediate the contamination. Keep in mind that your business purchase agreement is a “flexible” document that may be drafted by your business lawyer to protect your interests. Always discuss any concerns or issues that you may have with your business lawyer.

Obtain an Environmental Site Assessment

An environmental site assessment, also known as a phase I study or “ESA”, is a preliminary investigation and evaluation of a property’s “environmental history”. Typically viewed as the first step in the “environmental due diligence” process ESA’s focus on the documented history of a property and prior issues of contamination. ESA’s typically do not include soil samples or testing but may uncover serious incidents of prior contamination. If the Phase I study indicates the potential existence of prior contamination, additional studies may be warranted. When purchasing a New York or New Jersey car wash the cost of obtaining an ESA is nominal relative to the substantial investment that you are about to take.

Even if you are Leasing the Underlying Property, Prior Contamination Must Still be Evaluated

When purchasing a car wash or gas station involving only the lease of the underlying property (as opposed to the outright purchase), you must nevertheless be concerned about prior contamination.


  1. If the property is contaminated and requires remediation / abatement, even if you are not responsible for the cost of such activities (i.e., the Landlord is responsible), you will nevertheless be affected since the remediation activities may be intrusive (i.e., removal of substantial soil) and interfere with the day-to-day operations of your business or, worse, require you to shut down your business.
  2. If the prior condition of the property is not documented (i.e., as to prior acts of contamination), once you take over the property you may not be able to differentiate acts of contamination caused by your business activities and contamination that existed long before you purchased the business. This is important because under your lease agreement you may be responsible for future acts of contamination.

Learn More

Order a complimentary copy of Mr. Internicola’s Book: “An Entrepreneurs Guide to Buying a Business or Franchise” by clicking here.

Learn More About Business Transactions

Let's Talk

With services to make your growth strategy simple, cost effective, and with a team excited to help you, let’s talk about how we can help grow your brand. Click on the button below or call us at (800) 976-4904.

Top Resources for Franchising Your Business

  • videoImg

    Franchise Sales Compliance Guide

    Are you a franchisor or a part of a franchise sales team? Do you want to learn more about franchise sale compliance and ensure that your sales practices comply with franchise laws and are consistent with best practices? Then this guide is for you. In this guide you’ll learn the... read more

  • videoImg

    The Ultimate Guide to Franchising Your Business

    In this guide you’ll learn the basics of franchising, how to franchise your business, and how to win at franchising. We’ll also take a deeper dive into legal requirements for franchising and why they matter, steps to take before and after you launch your franchise, and even some tips on... read more

  • videoImg

    Franchising vs. Licensing

    When considering expanding a business both franchising and licensing are possible options. In this guide, you'll learn the differences of franchising and licensing and understand how each will affect you. read more

all guides

  • None right now

all videos

  • videoImg

    Franchising Your Business: Advantages & Disadvantages

    Are you considering franchising your business? If so, its important to understand the advantages and disadvantages of franchising your business. Franchising is a legal and business model designed to achieve multi-unit expansion. Compared to organic expansion where you invest in and open multiple locations yourself, franchising allows you to recruit... read more

  • videoImg

    Documents to Start a Franchise

    The documents to franchise your business include the franchise disclosure document (FDD), franchise agreement, operations manual, financial statements, and state specific registration applications. Below we discuss each franchise document in detail. 1. Franchise Disclosure Document Before you can offer or  sell a franchise you are required to issue and disclose... read more

  • videoImg

    Is Your Business Franchisable and Should You Franchise?

    Franchising may be the next big step for your business and represents an opportunity to grow your brand. So, how do you know if franchising is right for you? How do you know if your business is franchisable and, if it is, whether or not you should franchise your business?... read more

all articles

  • videoImg

    Positioning Your Brand to Win at Franchise Sales

    In this webinar, Charles Internicola and Laura Meyer, founder of Joybrand Creative, talk about how to position your brand to win at franchise sales. Some topics include: How franchisors can develop their brand strategy How to differentiate your brand strategy between your targeted end-user customers and prospective franchisees for franchise... read more

  • videoImg

    How to Work With Franchise Brokers and Sell Franchises

    In this webinar, Charles N. Internicola, Esq. and Lisa Welko, CFE of Integrity Franchise Group discuss what it takes to make your brand attractive to franchise brokers and sell to qualified franchisees.  Selling franchises and building a durable franchise system - all comes down to being a "good franchisor," making... read more

  • videoImg

    Leveraging PR & Digital Media to Jumpstart Franchise Sales

    Key strategies to accelerate franchise growth for startup and emerging franchisors In this webinar, franchise attorney Charles Internicola and Nick Powills, founder of No Limit Agency and 1851 Franchise, discuss key strategies to accelerate franchise growth through PR and digital media. Some topics include: Steps franchisors should take when it... read more

all webinars

Let’s Talk

With services to make your growth strategy simple, cost effective, and with a team excited to help you, let’s talk about how we can help grow your business.

Fill out the following form and we’ll contact you as soon as possible. To reach our team directly, give us a call at (800) 976-4904.

An attorney client relationship is not established by submitting this initial contact information.