We provide full commercial, financial, tax, legal, and market due diligence services for acquisitions or disposals of individual properties, portfolios and real estate businesses, as well as advise on deal structuring.
The purpose of acquisition due diligence is to ensure that the acquirer fully understands the key risks around the property or business that it is buying, by assessing and validating assumptions that underlie the deal, giving the acquirer a coherent overview of the financial position and obligations, and providing the acquirer with valuable information to support negotiation of the purchase consideration.
At the property level our review can give comfort on areas such as onerous lease covenants, termination provisions, rent reviews and the impact of other lease provisions on cash flows. We can review arrears, tenant covenants, service charges, planned capital expenditure, reports on title, and surveyor's valuations. We can also develop or review the cash flow models you use to assess the economics of the acquisition.
Effective acquisition due diligence of a business ensures that the purchaser fully understands the drivers behind the past investment history and performance, property valuations, rental streams and service charges, title deficiencies and profitability and that areas are identified which may require costs to be incurred in performing post-deal rectification.
Many clients also ask us to undertake reviews before they commit to a sale of a property or business. The purpose here is to alert the client to issues that a potential acquirer may raise, thereby giving time to respond to and deal with those issues. Experience shows that vendor assistance can significantly speed up the disposal process and help to maximize the sale proceeds.