This month we explore the tale of two clients and the definition of due diligence especially when it applies to buying or leasing property. Remember the story of the three little pigs; one built his house out of bricks, one out of straw...you know how it ends. You can cut corners to save time and money, but the person who puts in the hard work reaps the rewards.
Recently we did a due diligence report for our house of bricks client who wanted to purchase a new property for his organisation in the Brisbane CBD.We looked closely at the proposed property, delving into its condition, positioning, planning laws, floor plate efficiency, potential development options and even flooding
(it is Brisbane after all).The report provided all that was needed to make an informed offer.
Our house of straw client recently signed a 10 year lease for an existing warehouse.The project manager was then called to deliver a new fit-out and to relocate to his new premises. With the design completed and issued to Council, it was discovered the existing building didn’t comply. The current landlord had no intention of upgrading the building. This left him with a $1m DA to rectify the situation.
A due diligence report, prior to signing the lease, would have avoided this problem.Luckily, there was an exit clause in the lease.Get things checked out before you sign on the dotted line...save yourself the pain and embarrassment.