Real estate due diligence

A building can look entirely in order and still carry problems that no site visit will reveal: an extension that was never authorised, soil polluted by an earlier occupier, a tenant holding a side letter that quietly reduces the rent. Once the deed is signed, most of these become the buyer’s problem, and the price was fixed on the assumption that they did not exist. A seller’s assurances help, but they are only worth what the seller can still pay when the problem surfaces.

Due diligence is the structured way of finding out before you commit. Beyond ownership itself, a legal audit of real estate looks at:

• the rules on building permits, and on whether what stands on the site matches the plans that were approved;
• the rules on soil contamination, and on who pays for a clean-up that is discovered after the sale;
• the rules on energy performance, asbestos and the certificates a building must hold before it changes hands;
• the rules on fire safety, technical installations and access for the public;
• the rules on heritage protection, expropriation plans and other public-law restrictions that the deeds do not show;
• the rules on checking the rent roll and any side letters against what the leases themselves say;
• the rules on unpaid taxes and levies that attach to a property and follow it to a new owner;
• the rules on public subsidies granted for a property, and on the repayment that a change of owner can trigger.

Our lawyers can support you with this.