### Buyers seeking an environmental second opinion: real estate transactions and soil contamination around 2007

### Buyers seeking an environmental second opinion: real estate transactions and soil contamination around 2007

In the mid-2000s, securitization was progressing in the Japanese real estate market, and land transactions were becoming more active not only in urban areas but also in regional cities. At the same time, the Soil Contamination Countermeasures Law, which came into effect in 2003, made buyers and sellers more conscious of whether or not their land was contaminated. Particularly in the redevelopment of former factory sites and logistics centers, investment decisions were influenced by past land use history and the presence or absence of groundwater contamination.

What emerged in this environment was demand for "second opinions. The article points out that even if the seller presents an expert's investigation report, buyers have doubts as to whether the property is really safe and are increasingly requesting a third-party evaluation by hiring another investigation company or consultant. In the field, there was a mix of buyers who "want to check for themselves without taking the seller's explanation for granted," and practical limitations that "there are many details that can only be understood by an expert" [7†source].

The historical background at the time also included the subprime mortgage crisis, which began to expose risks in the real estate market on a global scale. It was a time when transparency in asset valuation was required and investors and companies began to regard "environmental risk" as a factor directly related to monetary value. Environmental management standards such as ISO 14001 were becoming more widespread in Japan, and companies and financial institutions were keenly aware that inadequate environmental response could lead to credit concerns.

Therefore, soil contamination investigations were not simply an environmental issue, but were directly linked to negotiations involving the finance, real estate, and construction sectors. The buyer's demand for a second opinion symbolizes this tension, and it can be said that behind every transaction there was always a lurking conversation about how to translate environmental risk into monetary terms and to what extent it could be trusted.