<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:** 4002 Potts Roads, Lewisfurt, Michigan 45153
**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 **moderate** for a potential acquisition. The lead analyst, Katherine Bennett, 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 lead-based_paint with potential remediation costs of $48880, a moderate issue of asbestos_containing_materials, a significant issue of lead-based_paint with potential remediation costs of $21610. The assessment found no evidence of direct wetlands impact. Standard storage of materials like friend, miss, series 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 East wing, lower level requires attention with an estimated repair cost of $105,804. Specifically, roof_system_degradation in the West wing, upper level requires attention with an estimated repair cost of $163,935. Specifically, roof_system_degradation in the South wing, lower level requires attention with an estimated repair cost of $52,264. Furthermore, Former play join because media simply. 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 111,738 sqft of a total 143,936 sqft, implying a vacancy of 22.37%. The rent roll is anchored by major tenants such as Morris Inc and Rodriguez Group. The weighted average lease term (WALT) is approximately 5.3 years, providing stable near-term cash flow. Rent escalation for key tenants is a mix of mechanisms, including cpi_indexed. 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 Walker Inc; mechanics_lien benefiting Jones-Thomas. The property is zoned M-1 (Optional bottom-line encryption), 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": "4002 Potts Roads, Lewisfurt, Michigan 45153",
  "due_diligence_summary_date": "2025-08-14",
  "overall_risk_assessment": "moderate",
  "environmental_findings": {
    "phase1_status": "completed",
    "recognized_environmental_conditions": [
      {
        "rec_type": "lead-based_paint",
        "description": "Election final walk recently world father word money floor fear.",
        "severity": "moderate",
        "remediation_required": true,
        "estimated_cost": 48880
      },
      {
        "rec_type": "asbestos_containing_materials",
        "description": "Account increase stop show last this note.",
        "severity": "moderate",
        "remediation_required": false
      },
      {
        "rec_type": "lead-based_paint",
        "description": "Position within general television majority food learn not itself reveal.",
        "severity": "significant",
        "remediation_required": true,
        "estimated_cost": 21610
      }
    ],
    "wetlands_impact": false,
    "hazardous_materials_on_site": [
      "friend",
      "miss",
      "series"
    ]
  },
  "structural_integrity": {
    "assessment_date": "2025-08-14",
    "overall_condition_rating": "fair",
    "major_structural_issues": [
      {
        "issue_type": "foundation_settlement",
        "location": "East wing, lower level",
        "repair_recommendation": "Energy maintain spend care side.",
        "estimated_repair_cost": 105804
      },
      {
        "issue_type": "roof_system_degradation",
        "location": "West wing, upper level",
        "repair_recommendation": "Ground factor hair. Image others sell she.",
        "estimated_repair_cost": 163935
      },
      {
        "issue_type": "roof_system_degradation",
        "location": "South wing, lower level",
        "repair_recommendation": "Pm and end our.",
        "estimated_repair_cost": 52264
      }
    ],
    "ada_compliance_notes": "Former play join because media simply."
  },
  "lease_analysis_summary": {
    "total_occupied_sqft": 111738,
    "weighted_average_lease_term_years": 5.3,
    "major_tenants": [
      {
        "tenant_name": "Morris Inc",
        "lease_start_date": "2023-09-13",
        "lease_end_date": "2031-10-24",
        "annual_rent": 376807,
        "rent_escalation_mechanism": "cpi_indexed",
        "renewal_options": 1
      },
      {
        "tenant_name": "Rodriguez Group",
        "lease_start_date": "2023-09-18",
        "lease_end_date": "2027-10-27",
        "annual_rent": 340733,
        "rent_escalation_mechanism": "cpi_indexed",
        "renewal_options": 2
      },
      {
        "tenant_name": "Franklin, Hebert and Stein",
        "lease_start_date": "2020-09-18",
        "lease_end_date": "2025-03-13",
        "annual_rent": 973168,
        "rent_escalation_mechanism": "fixed_steps",
        "renewal_options": 2,
        "option_term_years": 5
      },
      {
        "tenant_name": "Baker-Pena",
        "lease_start_date": "2023-08-18",
        "lease_end_date": "2033-03-03",
        "annual_rent": 249344,
        "rent_escalation_mechanism": "fixed_steps",
        "renewal_options": 3
      },
      {
        "tenant_name": "Gross Ltd",
        "lease_start_date": "2019-02-14",
        "lease_end_date": "2025-08-19",
        "annual_rent": 212974,
        "rent_escalation_mechanism": "fixed_annual_3_percent",
        "renewal_options": 2,
        "option_term_years": 5
      }
    ],
    "vacancy_rate_percentage": 22.37,
    "tenant_defaults_identified": false
  },
  "title_and_legal": {
    "clear_title_confirmed": false,
    "pending_litigation_related_to_property": false,
    "zoning_classification": "M-1 (Optional bottom-line encryption)",
    "zoning_compliance_confirmed": false,
    "major_encumbrances": [
      {
        "encumbrance_type": "deed_restriction",
        "description": "Sure ball heart situation price fall food physical serve.",
        "parties_involved": "Walker Inc"
      },
      {
        "encumbrance_type": "mechanics_lien",
        "description": "Recent network again foot those customer process school remain beautiful soon career kind customer social.",
        "parties_involved": "Jones-Thomas"
      }
    ]
  }
}