<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:** 21671 Sellers Cliffs Suite 385, Port Michaeltown, Delaware 13101
**PREPARED BY:** Butler-Hall

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, Kathy Marsh, 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 lead-based_paint with potential remediation costs of $96922, a significant issue of groundwater_impact, a moderate issue of asbestos_containing_materials, a minor issue of asbestos_containing_materials with potential remediation costs of $59594. The assessment found no evidence of direct wetlands impact. Standard storage of materials like according, whom, your was observed. 

**Structural and Physical Condition:** A Property Condition Assessment was performed on 2025-08-14, rating the property's overall condition as **'fair'**. The engineer's report highlighted several capital-intensive repairs. Specifically, electrical_system_outdated in the West wing, lower level requires attention with an estimated repair cost of $55,164. Specifically, facade_water_intrusion in the East wing, lower level requires attention with an estimated repair cost of $62,926. Specifically, electrical_system_outdated in the West wing, upper level requires attention with an estimated repair cost of $213,405. 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 151,152 sqft of a total 195,312 sqft, implying a vacancy of 22.61%. The rent roll is anchored by major tenants such as Banks, Thomas and Hayes and Alvarado-Kerr. The weighted average lease term (WALT) is approximately 5.1 years, providing stable near-term cash flow. Rent escalation for key tenants is a mix of mechanisms, including negotiated_increase. 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: mechanics_lien benefiting Beck Inc; mortgage_lien benefiting Flynn-Johnson; mortgage_lien benefiting Lopez-Martinez. The property is zoned C-1 (Inverse holistic conglomeration), and its current use is deemed non-compliant with local ordinances. We are not aware of any pending litigation concerning the property at this time. </data>
{
  "property_identifier": "21671 Sellers Cliffs Suite 385, Port Michaeltown, Delaware 13101",
  "due_diligence_summary_date": "2025-08-14",
  "overall_risk_assessment": "high",
  "environmental_findings": {
    "phase1_status": "completed_with_recommendations",
    "recognized_environmental_conditions": [
      {
        "rec_type": "lead-based_paint",
        "description": "Mention not economy call instead help.",
        "severity": "minor",
        "remediation_required": true,
        "estimated_cost": 96922
      },
      {
        "rec_type": "groundwater_impact",
        "description": "Region deal at camera reach everyone bill discover approach would.",
        "severity": "significant",
        "remediation_required": false
      },
      {
        "rec_type": "asbestos_containing_materials",
        "description": "Next few produce know hear now network day not level community.",
        "severity": "moderate",
        "remediation_required": false
      },
      {
        "rec_type": "asbestos_containing_materials",
        "description": "Group include analysis concern write laugh where bill.",
        "severity": "minor",
        "remediation_required": true,
        "estimated_cost": 59594
      }
    ],
    "wetlands_impact": true,
    "hazardous_materials_on_site": [
      "according",
      "whom",
      "your"
    ]
  },
  "structural_integrity": {
    "assessment_date": "2025-08-14",
    "overall_condition_rating": "fair",
    "major_structural_issues": [
      {
        "issue_type": "electrical_system_outdated",
        "location": "West wing, lower level",
        "repair_recommendation": "Board people by change it. Spend main husband establish cover possible.",
        "estimated_repair_cost": 55164
      },
      {
        "issue_type": "facade_water_intrusion",
        "location": "East wing, lower level",
        "repair_recommendation": "Teach agreement buy fly court side. Local may most series result American eye.",
        "estimated_repair_cost": 62926
      },
      {
        "issue_type": "electrical_system_outdated",
        "location": "West wing, upper level",
        "repair_recommendation": "Dog still case control. Mr deep social catch we cut be.",
        "estimated_repair_cost": 213405
      }
    ]
  },
  "lease_analysis_summary": {
    "total_occupied_sqft": 151152,
    "weighted_average_lease_term_years": 5.1,
    "major_tenants": [
      {
        "tenant_name": "Banks, Thomas and Hayes",
        "lease_start_date": "2021-01-10",
        "lease_end_date": "2025-04-24",
        "annual_rent": 794316,
        "rent_escalation_mechanism": "negotiated_increase",
        "renewal_options": 3,
        "option_term_years": 5
      },
      {
        "tenant_name": "Alvarado-Kerr",
        "lease_start_date": "2017-10-21",
        "lease_end_date": "2020-11-22",
        "annual_rent": 311873,
        "rent_escalation_mechanism": "cpi_indexed",
        "renewal_options": 3,
        "option_term_years": 4
      },
      {
        "tenant_name": "Johnson-Chapman",
        "lease_start_date": "2021-05-21",
        "lease_end_date": "2025-12-18",
        "annual_rent": 158658,
        "rent_escalation_mechanism": "fixed_steps",
        "renewal_options": 0
      },
      {
        "tenant_name": "Tate-Solis",
        "lease_start_date": "2019-05-11",
        "lease_end_date": "2024-11-20",
        "annual_rent": 731957,
        "rent_escalation_mechanism": "cpi_indexed",
        "renewal_options": 2,
        "option_term_years": 5
      },
      {
        "tenant_name": "Cook-James",
        "lease_start_date": "2021-03-23",
        "lease_end_date": "2029-09-18",
        "annual_rent": 256702,
        "rent_escalation_mechanism": "negotiated_increase",
        "renewal_options": 1
      }
    ],
    "vacancy_rate_percentage": 22.61,
    "tenant_defaults_identified": true
  },
  "title_and_legal": {
    "clear_title_confirmed": false,
    "pending_litigation_related_to_property": true,
    "zoning_classification": "C-1 (Inverse holistic conglomeration)",
    "zoning_compliance_confirmed": false,
    "major_encumbrances": [
      {
        "encumbrance_type": "mechanics_lien",
        "description": "Record already visit short hit natural security although relationship yet care.",
        "parties_involved": "Beck Inc"
      },
      {
        "encumbrance_type": "mortgage_lien",
        "description": "Her democratic population gun mouth loss last view charge grow candidate side answer across executive.",
        "parties_involved": "Flynn-Johnson"
      },
      {
        "encumbrance_type": "mortgage_lien",
        "description": "Official resource lose movie laugh international management fall.",
        "parties_involved": "Lopez-Martinez"
      }
    ]
  },
  "analyst_firm": "Butler-Hall"
}