The phrase "sharp lookout" means being very alert and paying close attention to your surroundings to watch out for any possible danger or problems. Full definition
Wading along banks of slender cordgrass, she keeps a sharp lookout for their telltale shapes crawling along the sand. (massaudubon.org)
On a clear day over the ice on the horizon the sky will be much paler or lighter in color and is easily distinguishable from that overhead, so that a sharp lookout should be kept and changes in the color of the sky noted. (scientificamerican.com)
Bring any and all concerns about the property to your inspector before he begins, so he'll keep a sharp lookout for possible problems. (realtor.com)