What are the due diligence issues that must be considered before bidding on a risky acquisition of an office building?
What are the due diligence issues that must be considered before bidding on a risky acquisition of an office building?
It's September 2009, and while most commercial real estate investors remain wary, closely held REIT Summitt Investors is considering making opportunistic purchases. At the top of their list is an office building called Zenith Center, located in a major Southwestern US city, which they hoped to purchase through a joint venture between Summitt and a Middle East sovereign fund. Summitt needs to move quickly since the seller, a bank managing foreclosed properties, wants to close the deal by year-end. In this case students create a concise business memo highlighting the due diligence issues to consider and proposing an acquisitions work plan.
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