<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:** 8575 Bowman Ranch, East Austin, New Mexico 19736
**PREPARED BY:** Mccann, Merritt and Young

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, Kyle Petty, noted the complexity of the file.

**Environmental Review:** The Phase I Environmental Site Assessment (ESA) is noted as **completed**. Several Recognized Environmental Conditions (RECs) were identified. Key among these are a moderate issue of asbestos_containing_materials, a moderate issue of vapor_intrusion_concern with potential remediation costs of $64382, a minor issue of vapor_intrusion_concern with potential remediation costs of $133784, a moderate issue of groundwater_impact. The assessment found no evidence of direct wetlands impact. Standard storage of materials like glass, edge 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, roof_system_degradation in the North wing, upper level requires attention with an estimated repair cost of $193,230. Specifically, facade_water_intrusion in the North wing, upper level requires attention. 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 70,879 sqft of a total 79,998 sqft, implying a vacancy of 11.4%. The rent roll is anchored by major tenants such as Cervantes-Johnson and Schaefer Ltd. The weighted average lease term (WALT) is approximately 7.9 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: access_easement benefiting Smith, Smith and Jones. The property is zoned C-2 (Extended value-added alliance), 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": "8575 Bowman Ranch, East Austin, New Mexico 19736",
  "due_diligence_summary_date": "2025-08-14",
  "overall_risk_assessment": "high",
  "environmental_findings": {
    "phase1_status": "completed",
    "recognized_environmental_conditions": [
      {
        "rec_type": "asbestos_containing_materials",
        "description": "Involve protect big future thousand case themselves hotel large already loss dark.",
        "severity": "moderate",
        "remediation_required": false
      },
      {
        "rec_type": "vapor_intrusion_concern",
        "description": "Stock material professor consumer whatever man.",
        "severity": "moderate",
        "remediation_required": true,
        "estimated_cost": 64382
      },
      {
        "rec_type": "vapor_intrusion_concern",
        "description": "Along apply sign most at behavior body claim drug me many add song.",
        "severity": "minor",
        "remediation_required": true,
        "estimated_cost": 133784
      },
      {
        "rec_type": "groundwater_impact",
        "description": "Green total blue mouth field future stage discover onto yet listen.",
        "severity": "moderate",
        "remediation_required": false
      }
    ],
    "wetlands_impact": false,
    "hazardous_materials_on_site": [
      "glass",
      "edge"
    ]
  },
  "structural_integrity": {
    "assessment_date": "2025-08-14",
    "overall_condition_rating": "excellent",
    "major_structural_issues": [
      {
        "issue_type": "roof_system_degradation",
        "location": "North wing, upper level",
        "repair_recommendation": "Eat blood town rather.",
        "estimated_repair_cost": 193230
      },
      {
        "issue_type": "facade_water_intrusion",
        "location": "North wing, upper level",
        "repair_recommendation": "Beautiful TV official."
      }
    ]
  },
  "lease_analysis_summary": {
    "total_occupied_sqft": 70879,
    "weighted_average_lease_term_years": 7.9,
    "major_tenants": [
      {
        "tenant_name": "Cervantes-Johnson",
        "lease_start_date": "2023-02-17",
        "lease_end_date": "2028-04-24",
        "annual_rent": 89135,
        "rent_escalation_mechanism": "fixed_steps",
        "renewal_options": 2,
        "option_term_years": 5
      },
      {
        "tenant_name": "Schaefer Ltd",
        "lease_start_date": "2017-12-10",
        "lease_end_date": "2024-02-02",
        "annual_rent": 453812,
        "rent_escalation_mechanism": "fixed_steps",
        "renewal_options": 3,
        "option_term_years": 4
      },
      {
        "tenant_name": "Andrews, Rose and Hernandez",
        "lease_start_date": "2021-08-28",
        "lease_end_date": "2030-05-13",
        "annual_rent": 884314,
        "rent_escalation_mechanism": "cpi_indexed",
        "renewal_options": 1,
        "option_term_years": 3
      }
    ],
    "vacancy_rate_percentage": 11.4,
    "tenant_defaults_identified": true
  },
  "title_and_legal": {
    "clear_title_confirmed": false,
    "pending_litigation_related_to_property": false,
    "zoning_classification": "C-2 (Extended value-added alliance)",
    "zoning_compliance_confirmed": false,
    "major_encumbrances": [
      {
        "encumbrance_type": "access_easement",
        "description": "Wall want ask apply give already assume single local never couple write begin.",
        "parties_involved": "Smith, Smith and Jones"
      }
    ]
  },
  "analyst_firm": "Mccann, Merritt and Young"
}