For Acquiring apartments, is it always required or strongly recommend to get ALTA survey and phase 1 environmental inspection?
The subject property is mixed use property- 30~ units and somewhat small commercial space on the first floor. I underwrote it where it pencils out even if the commercial space brings in zero revenue, so any hiccup with the commercial space wouldn’t be a disaster.
I want to be thorough in doing due diligence, but also don’t want to spends tens of thousands of dollars if unnecessary.
@Ki Lee while you may be willing to accept the risk your lender probably will not. Your lender is the one who will require it.
it would be prudent to have a phase 1 done since it helps you qualify for certain defenses. for multi-family, you should make sure that it covers asbestos, lead-paint, lead-in-drinking water and mold. the standard phase 1 scope of work does not include these issues.
I would risk buying without Phase 1 as long as I know there was no possible polluting business located previously on the property (for example gas station). For the ALTA I did most of the deals without it. But when selling one buyer did the survey and found out about encroachment of my building on neighboring land. The encroachment was there for 30+ years. No one ever complained about anything. He bought anyway, but I thought the deal will fall apart.