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Being first to know you have the right deal is different from being first with an offer.
Here's how to energize your resources and close more deals within a shorter time period.
For more than two decades, O'Connor & Associates has assisted thousands of clients in analyzing commercial property purchase decisions. Now, we are packaging our many years of experience in delivering components of due diligence into an integrated due diligence consulting practice called Due Diligence DirectTM!
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Due Diligence DirectTM will enable you
to more efficiently determine
which properties within a portfolio
are most attractive and worth
further investigation.
| Due Diligence DirectTM! is a consulting service for commercial property owners who need to more rapidly increase their portfolio but lack sufficient capacity to process the deals fast enough to meet investment goals. In today's market, availability of capital is not usually the problem. In fact, capital has been abundant during the past decade. Still, many commercial property investors and owners struggle to deploy capital in sufficient quantities because they cannot process enough deals. This is where O'Connor & Associates can make the difference.
Speed the Process
Do you suspect that by processing four, six or ten more properties per month, per quarter or per year you could reach your targeted increased NOI? If your answer is yes then we can provide the resources to get more properties through the due diligence cycle faster for a "go/no-go" decision -- at the best price and the best terms and conditions for every property under consideration.
Given the current investment climate, potential acquisitions are more frequently packaged as portfolios. Often, a buyer may sense that only selected properties in the portfolio may suit the investment criteria. Nevertheless, too often the complexity or time constraints force the buyer to pass on the opportunity because identifying which properties in the portfolio to analyze is cost and time prohibitive. Due Diligence DirectTM will enable you to more efficiently determine which properties within a portfolio are most attractive and worth further investigation.
Many bidders of commercial property are shortening due diligence schedules to gain competitive advantage. Shorter due diligence periods, combined with more frequent review of portfolios, suggest a need for more creative ways to deliberately move transactions forward.
How It Works
Before you spend too much money on legal, environmental or other specialists, we will work through your important market, economic and NOI considerations. Our advisors will meet with your key decision makers to agree on the investment decision points you seek to study and align with your acquisition target and NOI strategies. The number and mix of decision points you select will define the scope of work and our fee. Then the necessary specialists are deployed and coordinated to timely complete our analysis, results and recommendations.
We justify all fees on mutually agreed assumptions of the incremental deals done by your having the capacity to more rapidly visit properties and thoroughly evaluate their fit with your investment criteria. If included in the project scope, we then can propose action plans to improve the property to meet your operating and profitability goals.
Typical Investment Decision Points ("IDP's")
Several decision points are noted below. They are not all inclusive but do represent what we find the majority of our clients seek to understand before making a commitment to a major commercial real estate purchase. Each of these IDPs could be addressed with as many as 19 deliverable components in the final report.
- Opportunity to Increase Rents
What is the low and high range of rents in the given market area and what does that imply regarding acquisition price negotiation and NOI potential?
- Renovation Opportunity Given Market Rents
How much more can rents be increased? What is the optimal balance of capital improvement / renovations and increase in rent? What improvements will be required from the perspectives of market demand and competition to get a given rent per square foot?
- Highest and Best Use of Land
What is the highest and best use of a land parcel given market demand, competitive conditions and regulatory/community factors?
- Highest and Best Use of a An Existing Building
What is the highest and best use of an existing improvement given market demand, competitive conditions and regulatory/community factors?
- Increasing Occupancy via Renovation/Capital Improvements What renovations or repairs to this improvement are required to achieve your target occupancy level in a given time frame? Based on an analysis of comparable properties, what is the likely range of dollar investment to complete these improvements?
- Opportunity to Lower Operating Cost and Improve Net Operating Income
How can operating expenses be reduced in this property to a target level so as to achieve your desired return on capital at a given purchase price?
- Opportunity to Increase Pass Through Expenses and Improve Net Operating Income
What opportunities exists to increase pass through amounts to achieve your target return on capital or net operating income given market demand and competitive conditions? Due Diligence DirectTM Components
There are two categories of components, Property Review and Underwriting Analytics.
Property Review
Site visit by a professional with appraisal and construction knowledge to determine overall property condition
Maps
Plot/Site/Stacking Plan
Photos
Staffing/Payroll Plan
Capital improvements (Historical and Planned)
Service Contracts & Leased Equipment
Certificate of Occupancy
Zoning Letter
Warranties/Guaranties
Licenses/Permits
Underwriting Analytics
Historical Operating Statements (3yrs)
Certified current operating year statements (YTD)
6 month proof of collections
3 year historical rent rolls
Certified current rent roll
Budget projection
ARGUS discounted cash flow projections
Proof of utilities (electric, gas, water, sewer)
2 year and current real estate tax bills
Insurance certificate and last 2 year premiums
Standard least form
Major lease abstracts
Lease and amendments
24 month vacancy history
Store sales/financials (major tenants)
Neighborhood area data
Demographics
Complaints/litigation
Title and survey review
Gather available reports (former appraisals, engineering studies, etc.)
Call us for a quote. We know you don't have much time, particularly if you have already signed paperwork and are in the due diligence period, so we move quickly. Contact Mike Olivares, Managing Director, at 1-877-375-4291 for a rapid response on Due Diligence DirectTM!
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