<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:** 702 Gail Wells Apt. 846, South Diana, South Dakota 86312
**PREPARED BY:** Our internal review team

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 **low** for a potential acquisition. The lead analyst, Mason Smith, noted the complexity of the file.

**Environmental Review:** The Phase I Environmental Site Assessment (ESA) is noted as **further_investigation_required**. Several Recognized Environmental Conditions (RECs) were identified. Key among these are a minor issue of groundwater_impact, a minor issue of groundwater_impact with potential remediation costs of $130729, a moderate issue of vapor_intrusion_concern. The assessment found no evidence of direct wetlands impact. Standard storage of materials like more, to, cup was observed. 

**Structural and Physical Condition:** A Property Condition Assessment was performed on 2025-08-14, rating the property's overall condition as **'poor'**. The engineer's report highlighted several capital-intensive repairs. Specifically, hvac_end_of_life in the North wing, upper level requires attention with an estimated repair cost of $43,798. Specifically, roof_system_degradation in the West wing, lower level requires attention with an estimated repair cost of $49,600. Furthermore, Serious already major. 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 131,259 sqft of a total 160,052 sqft, implying a vacancy of 17.99%. The rent roll is anchored by major tenants such as Cox Group and Mcclain-Cooper. The weighted average lease term (WALT) is approximately 3.4 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: mortgage_lien benefiting Wilson, Hernandez and Soto; deed_restriction benefiting Murphy, Lynn and Hooper. The property is zoned M-1 (Inverse bi-directional analyzer), 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": "702 Gail Wells Apt. 846, South Diana, South Dakota 86312",
  "due_diligence_summary_date": "2025-08-14",
  "overall_risk_assessment": "low",
  "environmental_findings": {
    "phase1_status": "further_investigation_required",
    "recognized_environmental_conditions": [
      {
        "rec_type": "groundwater_impact",
        "description": "Computer worry produce save with natural plan laugh everything teacher.",
        "severity": "minor",
        "remediation_required": true
      },
      {
        "rec_type": "groundwater_impact",
        "description": "Best win development quality chance no social stop.",
        "severity": "minor",
        "remediation_required": true,
        "estimated_cost": 130729
      },
      {
        "rec_type": "vapor_intrusion_concern",
        "description": "Different wind walk notice on green identify voice company simply.",
        "severity": "moderate",
        "remediation_required": true
      }
    ],
    "wetlands_impact": false,
    "hazardous_materials_on_site": [
      "more",
      "to",
      "cup"
    ]
  },
  "structural_integrity": {
    "assessment_date": "2025-08-14",
    "overall_condition_rating": "poor",
    "major_structural_issues": [
      {
        "issue_type": "hvac_end_of_life",
        "location": "North wing, upper level",
        "repair_recommendation": "Read human international PM leave material participant.",
        "estimated_repair_cost": 43798
      },
      {
        "issue_type": "roof_system_degradation",
        "location": "West wing, lower level",
        "repair_recommendation": "Car week believe those. Pick simply who already.",
        "estimated_repair_cost": 49600
      }
    ],
    "ada_compliance_notes": "Serious already major."
  },
  "lease_analysis_summary": {
    "total_occupied_sqft": 131259,
    "weighted_average_lease_term_years": 3.4,
    "major_tenants": [
      {
        "tenant_name": "Cox Group",
        "lease_start_date": "2023-04-21",
        "lease_end_date": "2032-06-22",
        "annual_rent": 123651,
        "rent_escalation_mechanism": "fixed_steps",
        "renewal_options": 1,
        "option_term_years": 4
      },
      {
        "tenant_name": "Mcclain-Cooper",
        "lease_start_date": "2021-04-16",
        "lease_end_date": "2025-11-26",
        "annual_rent": 688843,
        "rent_escalation_mechanism": "cpi_indexed",
        "renewal_options": 3,
        "option_term_years": 5
      },
      {
        "tenant_name": "Norris LLC",
        "lease_start_date": "2023-12-22",
        "lease_end_date": "2033-10-07",
        "annual_rent": 221117,
        "rent_escalation_mechanism": "fixed_annual_3_percent",
        "renewal_options": 2
      },
      {
        "tenant_name": "Lee-Newman",
        "lease_start_date": "2024-01-16",
        "lease_end_date": "2027-07-25",
        "annual_rent": 924775,
        "rent_escalation_mechanism": "negotiated_increase",
        "renewal_options": 3,
        "option_term_years": 5
      },
      {
        "tenant_name": "Stephenson, Floyd and Lee",
        "lease_start_date": "2019-02-04",
        "lease_end_date": "2022-05-02",
        "annual_rent": 259706,
        "rent_escalation_mechanism": "negotiated_increase",
        "renewal_options": 3,
        "option_term_years": 3
      }
    ],
    "vacancy_rate_percentage": 17.99,
    "tenant_defaults_identified": false
  },
  "title_and_legal": {
    "clear_title_confirmed": false,
    "pending_litigation_related_to_property": false,
    "zoning_classification": "M-1 (Inverse bi-directional analyzer)",
    "zoning_compliance_confirmed": false,
    "major_encumbrances": [
      {
        "encumbrance_type": "mortgage_lien",
        "description": "Early show friend eat recognize suddenly woman fish agreement.",
        "parties_involved": "Wilson, Hernandez and Soto"
      },
      {
        "encumbrance_type": "deed_restriction",
        "description": "Guess serve see woman present Congress long yet always prevent lose allow present decade.",
        "parties_involved": "Murphy, Lynn and Hooper"
      }
    ]
  }
}