某房地产公司尽职调查报告.pptx

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1、AICPA National Real Estate ConferenceDue DiligenceStephen A.StonerNovember 17,20002What is Due Diligence Risk management toolVaries by client Varies by practitionerConsistency beginning to develop in secondary mortgage marketsIndustry standards accepted by rating agencies,investors,and intermediarie

2、sDependent on good data23History of Due Diligence Prior to 1980sMinimalLate 80s,early 1990sRequired and criticalMid 1990s-currentChanging real estate marketsMuch done internallyLarger buyersDifferent risk mitigation proceduresFutureto be determined34Reason for Due DiligenceFile stufferDecision toolS

3、ales toolAsset managementDeal structuring45The Due Diligence ProcessSalesContractExecutedFinancialOperationalReviewTenantReviewMarketAnalysisPhysical Asset and EnvironmentalReviewPro FormaAnalysisRecommendationto Buyer56The Due Diligence ProcessSalesContractExecutedTenantReviewMarketAnalysisPro Form

4、aAnalysisRecommendationto BuyerFinancialOperationalReviewPhysical Asset and EnvironmentalReview67Financial Operational ReviewRevenue StreamsCurrent RentSigned and current leases(including amendments)Legal clausesRight of first refusalGo dark provisionsRight to cancelNoncompete clausesOtherTenant tou

5、rAccounts receivable agingOther forms of cash flowStorageInternet and telecommunication accessPhone revenue(hotels and motels)Other78Financial Operational ReviewOperating Costs:high levelCosts per square feetBOMA and other benchmarks(building size,location and age)Analytic reviewReview of tax return

6、sAdjustments for unusual itemsResults used to focus detailed review89Financial Operational ReviewOperating Costs:detailedService contractsEconomic reviewReview executed contractsCompare financial terms to operating statementsLegal reviewDurationAbility to cancel or rebidImplications of saleRepairs a

7、nd maintenanceReview of vouchersCapitalization versus expensesProperty taxesReview recent tax billsOtherReview of vouchers910Financial Operational ReviewCapital itemsDeferred maintenanceWalkthrough Engineering reportCapital improvementsEngineering reportStrategic plan for property(ies)Identifiable v

8、ersus annualLease commissionsLinked to revenue streamMarket commissions-adjusted for business planTenant improvementsLinked to revenue streamPrimarily driven by physical condition of building and market requirementsEngineering report1011Financial Operational ReviewConclusionsNormalized NOIIdentifica

9、tion and quantification of trendsUnusual items1112The Due Diligence ProcessSalesContractExecutedTenantReviewMarketAnalysisPro FormaAnalysisRecommendationto BuyerFinancialOperationalReviewPhysical Asset and EnvironmentalReview1213Evaluation of Tenant CreditFinancial stability(credit rating)Industry c

10、oncentrationsOther concentrations1314The Due Diligence ProcessSalesContractExecutedTenantReviewMarketAnalysisPro FormaAnalysisRecommendationto BuyerFinancialOperationalReviewPhysical Asset and EnvironmentalReview1415Market AnalysisThree primary componentsSite analysisSupplyDemandSupplyDemandSquare F

11、eetTime1516Market AnalysisSite AnalysisVisibilityAccessIngress/EgressAmenitiesSources of demandCompetitionQualitySurrounding land uses,current and projected1617Market AnalysisSupplyHistorical inventoryExisting and future competitiveDisaggregated by size,quality,and ageProjected future developmentPla

12、nning departmentsMedia researchLocal market interviews1718Market AnalysisDemandHistorical absorptionMarket research of key indicatorsNew business startupsPopulation growthOther economic trendsOther demographic trendsProjected growth in demand Demand(sq ft)Time1819Market AnalysisReconciliation of sup

13、ply and demandRental ratesPercentage rentsOccupancy levelsCommissionsBuildoutGrowth ratesRentalExpenseCapitalization ratesRenewal assumption1920Market AnalysisSpace may be vacant prior to re-leasingNew rent is setNew tenant improvements,commissionsBase years,sales,other levels are setRenewal assumpt

14、ions-What happens at the end of a lease?2021The Due Diligence ProcessSalesContactExecutedTenantReviewMarketAnalysisPro FormaAnalysisRecommendationto BuyerFinancialOperationalReviewPhysical Asset and EnvironmentalReview2122Physical Asset and Environmental ReviewEngineering reportDeferred maintenanceR

15、equired capital improvementsArchitects or space plannersEfficiency of existing space:opportunities or constraints for value enhancementEnvironmentalPhase 1,2 and 3Title search2223The Due Diligence ProcessSalesContractExecutedFinancialOperationalReviewTenantReviewMarketAnalysisRecommendationto BuyerP

16、hysical Asset and EnvironmentalReviewPro FormaAnalysisConverting analysis to cash flow2324PROFORMA ANALYSISAnalysis of projection assumptions based upon historical performance and market researchCompilation of projected revenues,expenses and net operating incomeAnalysis of capitalization and discoun

17、t rates,debt service and post-financing cash flow,if required2425Things to look for:If a portion of the property was non-operating during the year,the effect on future operating results needs to be consideredThe sellers or buyers budget,if used in the analysis,may contain optimistic assumptionsThe f

18、ees and corporate overhead expenses charged by the seller will be modified after acquisitionAll appropriate taxing jurisdictions and respective taxes are adequately reflectedEffects of non-recurring items projected to occurPROFORMA ANALYSIS2526Tenant by TenantAppropriately TimedIndustry AcceptedReady for“What if”AnalysesEasy to Review and ProofPROFORMA ANALYSISAdvantages to Prefab Systems 26