What To Keep In Mind On Environmental Due Diligence?
In reality, there are several steps involved when it comes to environmental due diligence. Let’s assume that things are done right, the risks associated with land development can be significantly reduced and the odds for making profit are increased.
The first step prior to signing a contract with the seller is to negotiate clearly all the terms you require in environmental due diligence. Say that you as well as the seller understand all that’s expected of both sides, especially in due diligence period, you can avoid problems in the future. But just to be sure that the transaction goes smoothly and no problem will arise, it will be ideal if you are going to contact a lawyer to assist you in the process.
We know that buying a land is risky and it is advisable to try minimizing all potential risks from the start. In most instances, land purchase contracts go through different revisions and negotiations and it’s more difficult when the contract has been signed in getting both parties agree on contract amendments. Like what mentioned earlier, there are a number of different factors that go with the entire process of environmental due diligence which can influence the decision of buying an unimproved land and these are as follows.
Number 1. Title issues – are there anything suspicious on the land title or in other words, does the seller has a clean title to the property? As the buyer, it is your job to review all reports as well as the underlying documents that can affect the property. It is advisable if you are going to hire a real estate lawyer who will review all documents on your part no matter if you’re amateur or a seasoned developer/investor. On the other hand, you at the same time has to review the documentation yourself as well.
Number 2. Survey Issues – you need to check if there are encroachments from the adjoining land on your properties or vice versa when it comes to environmental due diligence. Encroachments can be utilities, neighboring buildings, water, fences and the likes. You and the seller as well need to resolve these issues before closing on the deal if there are any of it. Some issues might not be resolved or can be resolved in a timely manner and you have to decide if you still like to continue with the purchase even if there’s unresolved issue in the land.
Number 3. Land use approvals – another thing that should not be forgotten in environmental due diligence are zoning regulations, building permits and approvals, site plan approvals, setback issues, lot size, fire safety issues, health issues like septic disposal, sewer, storm water management, rivers, wetlands, streams and so forth.