What factors do you look for when performing your "due diligence" and how do you find them?
[{"id": "erz8u55", "text": "Depends on what I\u2019m doing. Experience is how you know what to look for, just need to crank through a ton of deal flow to know what\u2019s important and what isn\u2019t.", "replies": [], "depth": 1}, {"id": "erz9zq2", "text": "Property type? \n\nEg for multi, enter property name and or address plus \u201cshooting\u201d or \u201ccrime\u201d. Violations, permits, tax bills and appeals, resident profile, reviews reviews reviews (asbestos, poly piping, bad mgmt can occasionally be suggested).", "replies": [{"id": "erza4bu", "text": "I'm thinking a store front.", "replies": [], "depth": 2}], "depth": 1}, {"id": "erzb6ae", "text": "If this is for commercial property, you need to discuss this with an attorney.", "replies": [{"id": "erzbv3h", "text": "Thanks, I was planning to, I just wanted to see what the community here had to offer.", "replies": [{"id": "erzhyo2", "text": "I would get ahold of some executed contracts to get a feel for that. Although each deal is different, there tends to be certain trends that appear in almost every contract.", "replies": [{"id": "es1mgr1", "text": "This.\n\nWhen I first started in real estate where I worked just had me reading leases and sale contracts. It helped a lot because I could easily recognize boiler plate language. Then the sneaky additions that could hurt stuck out like sore thumbs.", "replies": [], "depth": 4}], "depth": 3}], "depth": 2}], "depth": 1}, {"id": "es08pfa", "text": "Property condition assessment\nPhase 1 environmental report\nTitle review\nLease audit/verification\n\nI\u2019d consider these the minimum", "replies": [{"id": "es0eviu", "text": "Thanks!", "replies": [], "depth": 2}], "depth": 1}, {"id": "es0cthe", "text": "For retail, here's what I look at... review all existing expenses (utilities, contracts, repairs/maintenance, taxes, insurance). Build in a small reserve as well. Review existing lease/s and note how long the lease runs, any escalations, whether they reimburse for any costs. Also take a look at the market rents in the area to see if the rent is in line with market, under market or over. If you can, try to get sales numbers for the tenant/s or ask to speak to them about how they're doing business wise. Have a contractor do a property condition report so they can let you know of any needed short term and long term repairs.", "replies": [], "depth": 1}, {"id": "es18ys2", "text": "Is the property under contract? I term due diligence after a property is under contract.\n\nYears on roof/hvac/elevators\n\nBuilding is older how is the electrical. \n\nDo tenants have HVAC maintenance contracts (retail/industrial). Does the landlord have HVAC maintenance contracts (office/vacancies).\n\nYou could get someone that can check everything to check out the property and then the red flags get the specific vendor to come out. \n\nDo tenants have certificates of occupancy if applicable.\n\nDo the leases match the OM information. Can any tenants break their lease. Has any of the tenants made a late payment in the past 12mo. Is there any TI due to the tenants that needs to be held from seller in an escrow account.\n\nThose are probably the most important things that I check when doing due diligence.\n\nIf you do anything read leases and inspect the roof/hvac.", "replies": [{"id": "es1d28h", "text": "Thanks a lot!", "replies": [], "depth": 2}], "depth": 1}, {"id": "es1c189", "text": "If buying, get up-to-date tenant estoppel certificates.  Contract should require that current owner will provide.\n\nIf leasing, then talk to former tenant and current tenants.  Understand that former tenant might bear a grudge and complaints should be taken with a grain of salt, but still worth asking why former tenant left.", "replies": [], "depth": 1}]