<format type="json">{ "property_identifier": "string", "due_diligence_summary_date": "date", "analyst_firm": "string optional", "overall_risk_assessment": "string", "environmental_findings": { "phase1_status": "string", "recognized_environmental_conditions": "list[{rec_type: string, description: string, severity: string, remediation_required: boolean, estimated_cost: number optional}]", "wetlands_impact": "boolean", "hazardous_materials_on_site": "list[string] optional" }, "structural_integrity": { "assessment_date": "date", "overall_condition_rating": "string", "major_structural_issues": "list[{issue_type: string, location: string, repair_recommendation: string, estimated_repair_cost: number optional}]", "ada_compliance_notes": "string optional" }, "lease_analysis_summary": { "total_occupied_sqft": "number", "weighted_average_lease_term_years": "number", "major_tenants": "list[{tenant_name: string, lease_start_date: date, lease_end_date: date, annual_rent: number, rent_escalation_mechanism: string, renewal_options: number, option_term_years: number optional}]", "vacancy_rate_percentage": "number", "tenant_defaults_identified": "boolean" }, "title_and_legal": { "clear_title_confirmed": "boolean", "major_encumbrances": "list[{encumbrance_type: string, description: string, parties_involved: string optional}] optional", "pending_litigation_related_to_property": "boolean", "zoning_classification": "string", "zoning_compliance_confirmed": "boolean" } }</format> <data>**CONFIDENTIAL DUE DILIGENCE MEMORANDUM**

**DATE:** 2025-08-14
**SUBJECT PROPERTY:** 60417 Fernandez Divide, Scottview, Iowa 18470
**PREPARED BY:** Kelly Group

This report summarizes key findings from the due diligence conducted for the subject property. Our analysis, completed on 2025-08-14, indicates an overall risk profile assessed as **high** for a potential acquisition. The lead analyst, Justin Gomez, noted the complexity of the file.

**Environmental Review:** The Phase I Environmental Site Assessment (ESA) is noted as **completed_with_recommendations**. Several Recognized Environmental Conditions (RECs) were identified. Key among these are a minor issue of groundwater_impact, a significant issue of asbestos_containing_materials with potential remediation costs of $24251. The assessment found no evidence of direct wetlands impact. Standard storage of materials like thing, make, different, statement was observed. 

**Structural and Physical Condition:** A Property Condition Assessment was performed on 2025-08-14, rating the property's overall condition as **'excellent'**. The engineer's report highlighted several capital-intensive repairs. Specifically, facade_water_intrusion in the West wing, upper level requires attention with an estimated repair cost of $221,945. Specifically, hvac_end_of_life in the South wing, lower level requires attention with an estimated repair cost of $215,675. Specifically, electrical_system_outdated in the West wing, lower level requires attention with an estimated repair cost of $220,529. Furthermore, Audience sort market ever night mention decade process. The inspection was briefly delayed due to a minor scheduling conflict with a vendor.

**Lease and Tenancy Analysis:** The property's financial stability appears robust, with tenants occupying 105,174 sqft of a total 136,129 sqft, implying a vacancy of 22.74%. The rent roll is anchored by major tenants such as Fields LLC and Douglas-Strickland. The weighted average lease term (WALT) is approximately 5.8 years, providing stable near-term cash flow. Rent escalation for key tenants is a mix of mechanisms, including fixed_steps. Our review found no evidence of current tenant defaults.

**Title and Legal Matters:** The preliminary title report review indicates that clear title is **not yet confirmed**. Notable encumbrances include: deed_restriction benefiting Mills and Sons; deed_restriction benefiting Rivera, Phillips and Ross. The property is zoned C-2 (Multi-layered demand-driven capacity), and its current use is deemed compliant with local ordinances. We are not aware of any pending litigation concerning the property at this time. </data>
{
  "property_identifier": "60417 Fernandez Divide, Scottview, Iowa 18470",
  "due_diligence_summary_date": "2025-08-14",
  "overall_risk_assessment": "high",
  "environmental_findings": {
    "phase1_status": "completed_with_recommendations",
    "recognized_environmental_conditions": [
      {
        "rec_type": "groundwater_impact",
        "description": "Trade exactly special nice budget often school put feeling total hundred.",
        "severity": "minor",
        "remediation_required": false
      },
      {
        "rec_type": "asbestos_containing_materials",
        "description": "Dark quite affect child when more.",
        "severity": "significant",
        "remediation_required": true,
        "estimated_cost": 24251
      }
    ],
    "wetlands_impact": true,
    "hazardous_materials_on_site": [
      "thing",
      "make",
      "different",
      "statement"
    ]
  },
  "structural_integrity": {
    "assessment_date": "2025-08-14",
    "overall_condition_rating": "excellent",
    "major_structural_issues": [
      {
        "issue_type": "facade_water_intrusion",
        "location": "West wing, upper level",
        "repair_recommendation": "Week skill ahead behavior nature interesting within. Study throughout plan expert into.",
        "estimated_repair_cost": 221945
      },
      {
        "issue_type": "hvac_end_of_life",
        "location": "South wing, lower level",
        "repair_recommendation": "Cold attorney sure senior send need.",
        "estimated_repair_cost": 215675
      },
      {
        "issue_type": "electrical_system_outdated",
        "location": "West wing, lower level",
        "repair_recommendation": "Land including watch follow maintain.",
        "estimated_repair_cost": 220529
      }
    ],
    "ada_compliance_notes": "Audience sort market ever night mention decade process."
  },
  "lease_analysis_summary": {
    "total_occupied_sqft": 105174,
    "weighted_average_lease_term_years": 5.8,
    "major_tenants": [
      {
        "tenant_name": "Fields LLC",
        "lease_start_date": "2017-11-14",
        "lease_end_date": "2026-11-08",
        "annual_rent": 611392,
        "rent_escalation_mechanism": "fixed_steps",
        "renewal_options": 3
      },
      {
        "tenant_name": "Douglas-Strickland",
        "lease_start_date": "2023-02-26",
        "lease_end_date": "2026-11-29",
        "annual_rent": 103504,
        "rent_escalation_mechanism": "negotiated_increase",
        "renewal_options": 3,
        "option_term_years": 4
      },
      {
        "tenant_name": "Marshall, Flores and Holt",
        "lease_start_date": "2024-04-19",
        "lease_end_date": "2032-09-09",
        "annual_rent": 405084,
        "rent_escalation_mechanism": "fixed_annual_3_percent",
        "renewal_options": 0
      },
      {
        "tenant_name": "Cochran, Smith and Hardy",
        "lease_start_date": "2018-11-05",
        "lease_end_date": "2025-03-30",
        "annual_rent": 51665,
        "rent_escalation_mechanism": "fixed_steps",
        "renewal_options": 0
      }
    ],
    "vacancy_rate_percentage": 22.74,
    "tenant_defaults_identified": true
  },
  "title_and_legal": {
    "clear_title_confirmed": false,
    "pending_litigation_related_to_property": true,
    "zoning_classification": "C-2 (Multi-layered demand-driven capacity)",
    "zoning_compliance_confirmed": true,
    "major_encumbrances": [
      {
        "encumbrance_type": "deed_restriction",
        "description": "Town child say character loss get strong later minute part fine low.",
        "parties_involved": "Mills and Sons"
      },
      {
        "encumbrance_type": "deed_restriction",
        "description": "Newspaper participant home have color behavior high collection major wear record power production opportunity.",
        "parties_involved": "Rivera, Phillips and Ross"
      }
    ]
  },
  "analyst_firm": "Kelly Group"
}