Environmental Report: Report generated by a qualified environmental firm to determine potential environmental hazards in a building's region or within the building itself.

Commercial property with a sophisticated tenant is also more conducive to investing somewhere other than your home-state, while any investment with a residential component you need to really understand the neighborhood and direction it is heading, as well as be able to oversee what goes on there, worry about tenant complaints, non payment, evictions, etc.

If the property can support a Freddie Mac ($750M minimum loan balance) or Fannie-Mae ($1M minimum loan balance) backed loan, the loan will be non-recourse - no-one comes after your personal assets if the property fails unless you did something illegal or environmental issues were the cause of the default.

Most importantly, in my book of knowledge, is critical component of trust and mutual respect.  

Hi @Scott Ruppel, Planning is one of the most important components of a successful 1031 Exchange transaction.  

If lease rates are less than you think and costs go up to renovate then poof your profit is gone.What about environmental?

(2) Would you take some deduction for the existing components (tub, vanity, etc) that were in good working condition yet were disposed? 

But I assume you'll be doing extensive due diligence before you purchase, anyway, so maybe the tenant will  be satisfied if you just share your inspection reports and the building plans, environmental reports, surveys, or whatever else you'll be undertaking anyway. 

If the equity upside is not predictable and it's an important component of the IRR/profit, don't buy (i.e. it does not meet your profit criteria).I vote patience and persistence...and have empathy and experience that it's not easy to do. 

Rents (if applicable) will be current and be prorated as of the date title transfers.DEFECTS: Seller warrants Property to be free from hazardous substances and from violation of any zoning, environmental, building, health or other governmental codes or ordinances.