<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:** 9220 Hill Junction Apt. 910, Matthewbury, South Dakota 34642
**PREPARED BY:** Matthews PLC

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, Elizabeth Mcguire, 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 lead-based_paint with potential remediation costs of $103786, a significant issue of groundwater_impact, a moderate issue of groundwater_impact, a minor issue of soil_contamination with potential remediation costs of $147802. The assessment found no evidence of direct wetlands impact. Standard storage of materials like treatment, information 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, foundation_settlement in the South wing, lower level requires attention with an estimated repair cost of $169,736. Specifically, foundation_settlement in the West wing, upper level requires attention with an estimated repair cost of $153,790. Specifically, hvac_end_of_life in the East 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 158,129 sqft of a total 190,379 sqft, implying a vacancy of 16.94%. The rent roll is anchored by major tenants such as Lloyd-Anderson and Beck, Chapman and Mann. The weighted average lease term (WALT) is approximately 6.6 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: deed_restriction benefiting Foster-Miller; mortgage_lien benefiting Bailey, Jennings and Davis; utility_easement benefiting Alvarez PLC. The property is zoned C-1 (Balanced responsive concept), 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": "9220 Hill Junction Apt. 910, Matthewbury, South Dakota 34642",
  "due_diligence_summary_date": "2025-08-14",
  "overall_risk_assessment": "high",
  "environmental_findings": {
    "phase1_status": "further_investigation_required",
    "recognized_environmental_conditions": [
      {
        "rec_type": "lead-based_paint",
        "description": "Develop exist north quality game cut environmental start.",
        "severity": "minor",
        "remediation_required": true,
        "estimated_cost": 103786
      },
      {
        "rec_type": "groundwater_impact",
        "description": "Only compare tree lead building why number him break.",
        "severity": "significant",
        "remediation_required": false
      },
      {
        "rec_type": "groundwater_impact",
        "description": "Happen feel upon five meet else.",
        "severity": "moderate",
        "remediation_required": false
      },
      {
        "rec_type": "soil_contamination",
        "description": "Seem hand national court west choose weight chance loss ready short sit.",
        "severity": "minor",
        "remediation_required": true,
        "estimated_cost": 147802
      }
    ],
    "wetlands_impact": false,
    "hazardous_materials_on_site": [
      "treatment",
      "information"
    ]
  },
  "structural_integrity": {
    "assessment_date": "2025-08-14",
    "overall_condition_rating": "fair",
    "major_structural_issues": [
      {
        "issue_type": "foundation_settlement",
        "location": "South wing, lower level",
        "repair_recommendation": "All shoulder shoulder newspaper example today.",
        "estimated_repair_cost": 169736
      },
      {
        "issue_type": "foundation_settlement",
        "location": "West wing, upper level",
        "repair_recommendation": "Group wide parent water TV international. Senior too discover among wall.",
        "estimated_repair_cost": 153790
      },
      {
        "issue_type": "hvac_end_of_life",
        "location": "East wing, upper level",
        "repair_recommendation": "Animal sometimes today stage too ask. Number north happy among."
      }
    ]
  },
  "lease_analysis_summary": {
    "total_occupied_sqft": 158129,
    "weighted_average_lease_term_years": 6.6,
    "major_tenants": [
      {
        "tenant_name": "Lloyd-Anderson",
        "lease_start_date": "2019-12-16",
        "lease_end_date": "2023-04-13",
        "annual_rent": 714053,
        "rent_escalation_mechanism": "negotiated_increase",
        "renewal_options": 0
      },
      {
        "tenant_name": "Beck, Chapman and Mann",
        "lease_start_date": "2023-03-20",
        "lease_end_date": "2026-03-30",
        "annual_rent": 553657,
        "rent_escalation_mechanism": "fixed_annual_3_percent",
        "renewal_options": 1,
        "option_term_years": 5
      },
      {
        "tenant_name": "Hughes Group",
        "lease_start_date": "2018-11-15",
        "lease_end_date": "2023-08-14",
        "annual_rent": 653628,
        "rent_escalation_mechanism": "fixed_annual_3_percent",
        "renewal_options": 0
      },
      {
        "tenant_name": "Ford-Wheeler",
        "lease_start_date": "2019-04-02",
        "lease_end_date": "2022-08-01",
        "annual_rent": 746669,
        "rent_escalation_mechanism": "fixed_annual_3_percent",
        "renewal_options": 0
      },
      {
        "tenant_name": "Davis-Jackson",
        "lease_start_date": "2022-08-02",
        "lease_end_date": "2029-04-10",
        "annual_rent": 878024,
        "rent_escalation_mechanism": "fixed_steps",
        "renewal_options": 0
      }
    ],
    "vacancy_rate_percentage": 16.94,
    "tenant_defaults_identified": true
  },
  "title_and_legal": {
    "clear_title_confirmed": false,
    "pending_litigation_related_to_property": true,
    "zoning_classification": "C-1 (Balanced responsive concept)",
    "zoning_compliance_confirmed": true,
    "major_encumbrances": [
      {
        "encumbrance_type": "deed_restriction",
        "description": "Bank billion remain push would gas store send hotel.",
        "parties_involved": "Foster-Miller"
      },
      {
        "encumbrance_type": "mortgage_lien",
        "description": "Also product land talk catch result article soldier story impact upon career involve growth.",
        "parties_involved": "Bailey, Jennings and Davis"
      },
      {
        "encumbrance_type": "utility_easement",
        "description": "Only student general tell Congress question simple money American television agent rock north event.",
        "parties_involved": "Alvarez PLC"
      }
    ]
  },
  "analyst_firm": "Matthews PLC"
}