Commercial Real Estate Due Diligence Checklist (Idaho)

In a house sale, the inspection is one contingency on a standard form. In a commercial sale, due diligence is the deal. It is a negotiated period, often 30 to 90 days, when the buyer investigates the property and can usually walk away. At the end of that period, the earnest money often goes hard. That means it is no longer refundable.

This guide is a working checklist. It tells you what to check, who does each check, and which items take the longest. It also covers a few Idaho issues that buyers miss.

This is general information, not legal advice. Have a commercial real estate attorney review your contract and diligence terms.

Step 1: Read the contract and set the clock

Your diligence period is a negotiated term. It is not pre-printed boilerplate. Before you order anything, read these terms.

How long is the diligence period, and when does it start?
What can the buyer investigate? Can the buyer enter the building, take samples, and talk to tenants?
What happens to the deposit if the buyer ends the deal inside the period?
Does the seller have to deliver documents, and by what date?
Can the period be extended if a report is late?

Then work backward from the deadline. List each report, the days it needs, and the day you must order it. Anything that takes weeks must start in the first days, not the last.

Step 2: Order the slow items first

Three items usually set the pace. Order them as soon as the contract is signed.

The physical report: a property condition assessment or a commercial building inspection. See our guide to choosing between them.
The Phase I environmental site assessment. See the Phase I guide.
The land title survey, and the title commitment it must match.

If your lender needs these reports, ask the lender which standard it names before you order. A report that does not meet the lender’s standard is a report you pay for twice. See what lenders require.

Step 3: Title and survey

Order a title commitment. Read every exception and every recorded easement. Ask the title company for copies of the underlying documents.

Order a survey that matches the transaction. For commercial deals, lenders and title companies commonly ask for an ALTA/NSPS Land Title Survey. ALTA says these standards set the minimum requirements for surveys used in commercial real estate transactions. ALTA reports that a revised set of standards superseded the 2021 version and took effect on February 23 (2026) for surveys commenced on or after that date. Ask your surveyor which edition applies to your survey. The surveyor also offers optional “Table A” items. Negotiate those with the title company and lender before work starts.

Check these items against each other:

The legal description in the contract, the title commitment, and the survey
Easements and rights of way, and whether any building or parking area sits on one
Encroachments from or onto neighboring land
Access: does the property touch a public road, or does it rely on an easement?

Step 4: Leases, income and the tenants

If the building has tenants, you are buying cash flow as well as a structure. A building can inspect clean and still be a bad buy if the income does not hold up.

Ask the seller for:

The rent roll, and every lease with all amendments
Operating statements for the periods your lender and investors require
A list of tenant deposits and any unpaid rent
Service contracts, such as landscaping, snow removal, and fire alarm monitoring
Estoppel certificates from tenants. An estoppel is a signed statement by the tenant that confirms lease terms and says no default exists.

Then compare the documents to each other. Does the rent roll match the leases? Do the estoppels match both? Look at lease expirations, renewal options, rent escalations, and who pays for what.

If the leases are triple net (NNN), the tenant carries most maintenance duties. Check whether the tenant has met them. A NNN lease inspection documents building condition against the lease’s maintenance and replacement terms.

Step 5: Physical condition of the building

The physical report answers a plain question: what will this building cost to own?

Pick the report by the question you need answered.

A Property Condition Assessment (PCA) follows ASTM E2018. It is the report lenders and institutional buyers expect. It describes major systems and gives opinions of probable cost.
A commercial building inspection follows the CCPIA Commercial Standards of Practice. It is narrative and defect-focused. It describes what is wrong now.

Neither is a home inspection. A home inspector works to a residential standard. Commercial buildings carry low-slope roof membranes, packaged rooftop HVAC, three-phase electrical, fire and life-safety systems, and accessibility duties. Those systems carry the money.

Your physical report should cover these areas:

Site: paving, drainage, parking, lighting, fencing
Structure: foundation, framing, floors, roof structure
Building envelope: roof, walls, windows, doors, signs of moisture
Mechanical: heating, cooling, ventilation, water heating
Electrical: service size, distribution, panels, emergency power
Plumbing: supply, waste, fixtures
Life safety: fire alarm, sprinklers, egress, emergency lighting
Vertical transportation: elevators and lifts, if present
Interior finishes and common areas

Ask for the costs in a table. A cost-to-cure report turns findings into dollars. Read how to read a property condition report before you use those numbers in a negotiation.

Add specialist reviews where the building calls for them.

Roof: a roofing specialist can tell you whether the roof needs a recover or a tear-off.
Electrical and mechanical: a specialist can test whether aging equipment has usable life.
Infrared thermography can find hot electrical connections and moisture behind surfaces.
Sewer lateral inspections show the condition of the line from the building to the main.
Fire door inspections check that rated doors work as required.
ADA and accessibility surveys show barriers and likely exposure.

Calibre’s article on the PCA scope explains that a larger budget does not by itself buy a better report. Money helps only when it targets the uncertainties that matter on your property. Read A Bigger PCA Budget Will Not Buy You a Better Report before you scope the work.

Step 6: Environmental

A Phase I Environmental Site Assessment looks at past and present uses of the property and nearby sites. It checks for signs of releases of hazardous substances or petroleum. It involves a records search, a site visit, and interviews. See the Phase I guide.

Two points matter for timing.

To claim federal liability protection as a buyer, the inquiry must be done before you acquire the property. EPA says the protections are for innocent landowners, contiguous property owners, and bona fide prospective purchasers.
Under the EPA rule, certain parts of the inquiry must be done or updated within 180 days before the acquisition date. Others can be up to one year old.

Calibre’s article for new commercial agents says that on most financed deals a Phase I is not optional. Check the lender’s rule. See Phase 1 ESA services.

Step 7: Zoning, permits and code

Ask the city or county for the zoning classification, and confirm the current use is allowed. Ask for permit history on major work. Ask whether any open code violations exist.

Do not rely on the seller for this. Get a zoning letter or confirm with the planning department. Some buyers hire a zoning report firm. Your attorney can advise on which route fits your deal.

Check accessibility. A building altered without permits or without accessibility upgrades can carry exposure that shows up later. An ADA survey gives you a view of the likely items.

Step 8: Insurance and risk

Ask an insurance agent to quote the building before the diligence period ends. Share the physical report with the agent. Roof age, electrical type, and sprinkler status may affect coverage and cost, so ask the agent which items matter.

In Idaho and the Intermountain West, ask about wildfire exposure. See wildfire pre-inspections for commercial properties.

Step 9: Lender requirements

Lenders have their own checklists. A lender may name a standard, a report age limit, and a list of approved or acceptable firms. Ask for this list in writing on day one. See what lenders require.

Idaho issues to put on your list

These items come from Idaho agencies and the Idaho Legislature. They are not a full Idaho legal guide.

Seller disclosure. Idaho’s Property Condition Disclosure Act is in Title 55, Chapter 25 of the Idaho Code. The Idaho Legislature describes it as a law that requires sellers of residential real property to complete a disclosure form. Do not assume a commercial seller has delivered a similar form. Ask your attorney what the seller must disclose in your deal.

Environmental cleanup help. Idaho DEQ runs a Voluntary Cleanup Program under the Idaho Land Remediation Act (Idaho Code Title 39, Chapter 72). DEQ says any legal entity can apply. DEQ lists a Covenant Not to Sue and lender liability protection among the program benefits, and a Certificate of Completion after cleanup is approved. DEQ lists a $250 application fee and a $2,500 initial deposit for oversight costs. Check DEQ’s page for current fees. This matters if your Phase I finds a problem and you still want the property.

Storage tanks. DEQ regulates underground storage tanks. DEQ lists duties for tank owners, such as designating Class A and Class B operators and reporting suspected releases. If your Phase I mentions a tank, ask the environmental professional what records exist.

Water rights. Idaho Code Section 42-248 requires water right owners to notify the Idaho Department of Water Resources of a change in ownership. If the property comes with irrigation or other water rights, ask your attorney to confirm what transfers and who files.

Building codes. Idaho adopts building codes by state statute (Idaho Code Section 39-4109). ICC reports that rules adopting new editions must be passed by the Legislature. The edition in force changes over time. Ask the local building department which edition applies.

Wildfire and climate. Calibre’s article on wildfire pre-inspections covers defensible space and insurance positioning for Idaho commercial properties.

Regional coverage. Calibre serves Idaho, Eastern Washington, Eastern Oregon, and Western Montana. Rules for Washington, Oregon and Montana differ. Do not reuse this Idaho list across state lines.

Red flags that should slow a deal

The seller will not provide leases or estoppels on a reasonable schedule.
The property condition report shows major systems near the end of their service life, and the price does not reflect it.
The Phase I identifies a recognized environmental condition and no one has a plan.
The lender’s report standard differs from the report you ordered.
The survey shows an encroachment or an easement that blocks the planned use.
The seller will not allow the specialist work the inspector recommends.

After diligence: use the results

Turn findings into numbers. Compare the cost to cure and the reserve forecast to the price. Decide whether to proceed, renegotiate, or walk. Share the reports with your lender, your insurer, and your partners. Keep the reports. They are your baseline for future capital planning.

Quick checklist

Frequently asked questions

How long is the due diligence period for a commercial property?

It is negotiated. Calibre's experience, stated in its article for new commercial agents, is that the period is often 30 to 90 days. The contract sets the actual length. Ask your attorney to confirm the terms before you sign.

What is the difference between due diligence on a house and on a commercial building?

For a house, the inspection is one contingency on a standard form. For a commercial building, due diligence is a defined period with its own terms. The buyer reviews title, survey, leases, income, building condition, and environmental risk. The earnest money often goes hard at the end of the period.

What reports should I order first?

Order the slow items first: the property condition assessment or commercial building inspection, the Phase I ESA, and the survey. If a lender is involved, confirm which standards it names before you order.

Do I need both a property condition assessment and a Phase I ESA?

They answer different questions. A PCA covers the physical condition of the building. A Phase I covers environmental risk. Many lenders require both. See the guide on which report you need.

What is an estoppel certificate?

It is a signed statement from a tenant that confirms the lease terms and says there is no default. Buyers and lenders use it to check that the seller's rent roll and lease documents are accurate.

Can a home inspector inspect a commercial building?

A home inspector works to a residential standard. Commercial physical due diligence uses ASTM E2018 for a property condition assessment or the CCPIA Commercial Standards of Practice for a commercial building inspection. Those reports cover systems a home inspection is not built to read.

Does Idaho require a seller disclosure for commercial property?

Idaho's Property Condition Disclosure Act, Idaho Code Title 55, Chapter 25, is described by the Idaho Legislature as requiring sellers of residential real property to complete a disclosure form. Ask an Idaho real estate attorney what applies to your commercial deal.

What can I do if the Phase I finds contamination in Idaho?

Talk to the environmental professional and your attorney. Idaho DEQ operates a Voluntary Cleanup Program that lists a Covenant Not to Sue, lender liability protection, and a Certificate of Completion as program outcomes. Review DEQ's page for current terms.

Sources

Lender guides and standards change. Confirm current requirements with your lender and counsel. This guide is general information, not legal advice.

Commercial real estate due diligence checklistwhat to check and when