Due Diligence in Real Estate

Are you looking to invest your hard-earned money in real estate? Have you done your due diligence?

Doing your real estate homework will prove to benefit your investment in the long run.  Never Assume……Assess, that’s our motto.  Purchasing a commercial or multifamily property can be risky yet rewarding.  NAC can help you make informed decisions about your real estate investments while maximizing value.

Performing on-site inspections is a sure-fire way to determine if the property is worth the time and money.  A thorough assessment of the property is an accurate way to determine the condition of a building.  It also helps determine hazards that may be issues in the process.  Items such as potential repairs and damage can be pinpointed and the cost associated with getting them fixed can be estimated. NAC’s staff can determine the approximate life expectancy of building systems and other elements.

The physical condition of a building including the quality of construction, and integrity of the mechanical, electrical and plumbing are important considerations that prospective building owners, real estate developers and lenders need to know.  Natura’s professional staff help our clients determine these factors through a tailored scope building assessment. Performing due diligence in real estate before signing a purchase agreement can help the buyer have a stronger hand in the negotiation process.

Follow standards and guidelines.

Beyond the condition of the property, there are considerations for environmental hazards.  Hazardous environmental conditions can exist from past operations on the property in question.  It can even come from neighboring properties.  A Phase I Environmental Assessment based on the ASTM E1527-13 standard will help to identify potential hazards and liabilities.  It also requires to meet Comprehensive Environmental Response Compensation and Liability Act (CERCLA) and All Appropriate Inquiry (AAI) obligations.  Although not a part of a base Phase I ESA, performing asbestos, lead based paint, and radon testing can alert a building owner to interior hazards that are health risks to building occupants.

Energy consumption is another consideration when purchasing a property.  In some areas of the country such as California, there is legislation that requires the disclosure of energy use in conjunction with a building sale or lease of a building.  Even in areas where it’s not required by law, considering energy use of a building can provide valuable insight on operational costs and areas for improvement.  NAC’s staff helped to develop the ASTM E2797-15 Building Energy Performance Assessment standard for disclosing energy use in existing buildings.

Avoid pitfalls and do your homework. Call NAC today to schedule your consultation, because knowledge is power. We can help protect your investment and most of all reduce your liability. #WeLoveBuildings