Acquisition Flashcards
Acquisitions in real estate include the acquisitions of:
(4 points)
- Land
- Buildings
- Shares of real estate equity investments
- Portfolios of property
3 questions you should ask when determining whether to do a real estate deal.
- How much money do I have?
- What is my risk profile?
- Is this market familiar or not?
What is the first phase of the investment process?
Concept:
- Finding the deal
- Due diligence
- Project evaluation
What is the second phase of the investment process?
Commitment
- Project under contract
- Feasibility testing
- Project strategy
Name the third phase of the investment process.
Closing
- Financing
- Closing
- Implementation
In phase one, what are the 2 things that should happen after finding the deal?
- Confidentiality agreements
- Soft deposit
___ is the detailed process of evaluating an asset that provides the building blocks of good investment practice.
Due diligence
Win-win negotiation style
(4 points)
- We trust eachother
- Multiple issues are involved
- Future deals may occur
- Cooperative by nature
Win-lose negotiation style
(4 points)
- We don’t trust eachother
- Single issues are involved
- Little chance of future deals
- Enjoys the game of negotiation as opposed to the results
Duties of an agent
(5 points)
- Loyalty
- Disclosure of information
- Avoidance of conflicts of interest
- Confidentiality
- Diligence to act in the best interest of the Principal
The Letter of Commitment of Letter of Intent (LOI) includes:
(4 points)
- Major points of the deal
- Price, timing, broker involvement
- Financing conditions, tenant arrangements, inspections timing and property access
- Neither party is legally bound until the formal Purchase and Sale Agreement is executed
Phase three (Closing) is based on a positive conclustion of:
(3 points)
- Due diligence
- Feasibility testing
- Negotiation between buyer and seller
