Environmental Due Diligence
When it comes to environmental due diligence, there are actually a number of steps involved in it. Let us say for example that everything is done correctly, the risks associated with land development are significantly reduced while the possibilities for making profits are increased.
The first step before you decide to sign a contract with the seller is negotiating clearly all terms you need in environmental due diligence. You can avoid problems to arise in the future say that you and the seller as well has understood all that is expected of both sides, particularly in due diligence period. 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’s mentioned earlier, there are several factors that go with the process of environmental due diligence which influences the decision of buying an unimproved land and these include the following.
Number 1. Title issues – does it seem that something is suspicious on the land title or in other words, are you sure that the title to the property is clean? It is your job as the buyer to review all reports and the underlying documents that may affect the property. Hiring a real estate lawyer to review all the documents on your behalf is strongly recommended regardless if you’re an amateur or a seasoned developer/investor. You on the other hand have got to review the documentation yourself too.
Number 2. Survey Issues – when talking about environmental due diligence, checking encroachments from adjoining land on your properties or vice versa is a must. Encroachments can be utilities, neighboring buildings, water, fences and the likes. If there are any of it, you as well as the seller need to resolve these issues before closing on the deal. There are issues that can be resolved while others can be solved in a timely manner and in case that you have decided to still pursue with the purchase if there’s unresolved issues in the land, it’s all in your discretion.
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.