The Davies REIS consulting team works on a fee basis with
the amount calculated according to the time and skill level of work required rather than the size or value of the
property. An engagement starts with a detailed proposal outlining the nature and scale of the assignment and tasks to accomplish.
These may include:
- Organize and manage
the process Once a purchase/sale agreement is signed or financing obtained, Davies REIS will work with your staff
on getting to closing. We can help your team work efficiently by assigning tasks and doing the work when needed. For example,
if no one on the team is adept at interpreting the business impact of leases or providing abstracts for property management
systems, we can complete this task.
- Hire and supervise vendors Before the ink dries on
the contract, vendors and service providers such as environmental engineers, surveyors, outside legal counsel and appraisers,
should be ready to start. Davies REIS will work with the contractors already selected by the client or can suggest and
negotiate with them as the client's agent. We will also determine what services are needed. Is a zoning or environmental lawyer
needed; should a structural engineer examine potential trouble spots; does the lender require an appraisal?
and create documents and documentation As every seller and buyer knows, reams of paperwork, copies of studies,
site and floor plans, policies, and certificates are exchanged in any transaction. Davies REIS can help find the documents,
assemble them, and convert them to whatever formats are necessary. We can also generate summary tables such as historic operating
data and a list of security deposits or explanatory narratives. For example, you may need to describe the particular
needs or restrictions on a tenant, or the reason for a recent repair.
- Review Data Once the documents
and data are obtained, the most important part of the process begins--the review and evaluation of the information obtained.
The value of all income properties relies on the terms of their leases and quality of the tenants. Not only must you know
the rent charged, but the likelihood of it being paid and the cost of that lease. Is the tenant likely to merge and leave?
Can the tenant be readily replaced? Does the landlord owe improvements? Davies REIS can parse each lease from a business
perspective and summarize the most significant terms and/or raise concerns. We can also review tenant and building files and
discuss issues with property management. That is, Davies REIS will ask the questions and find the answers.
depend on trust and integrity. The highest level of confidentiality is maintained so that no proprietary information is shared.
Any potential conflict of interest is avoided and acknowledged immediately when it occurs.
EXAMPLE OF TASKS
- Organize. Map out the process.
What needs doing and who does it.
- Financial analysis - We can start with the decision making on a potential acquisition
or disposition of an asset, or financing structure. If buying, test for sensitivity to best case/worst case market conditions;
what type of capital is least expensive - fixed vs. floating; A&B or senior only, conduits? Amount of leverage? We cannot
arrange the financing or acquisition, but we can evaluate the possibilities. Also, work on portfolio strategy - keep and refinance
or dispose of an asset. Cost/benefit. Balance-same property manager?
- Underwriting - conform to lender's standards in financial analysis; provide
support for assumptions.
- Due diligence: manage and conduct due diligence tasks. Work with your team. Complement the talent
already on board.
- Complete the paperwork from loan applications to forms for tax ID's for SPE's; set up bank accounts - lock
box? Where to send rent. Check with local officials on zoning/permit conformance. Assist attorneys.
- Review leases from a business perspective
and check tenant credit; look for special allowances, requirements, rights, and termination options.
- Property inspections
- anything of concern in price negotiation? Anything to trip up loan?
- Get insurance as required by lender.