Commercial Due Diligence and transaction consulting

Commercial Due Diligence: understanding the particular features of social property

The economic viability of a social property is determined by a complex network of operational, legal and social factors. Our specialised commercial due diligence analyses these critical points. These include location quality, competition, property concept, marketable rental rates and legal requirements as well as the quality of the operator. With around 30 years of practical experience, we assess potential risks and provide you with a clear assessment of the sustainability of the planned investment.

Comprehensive purchase audit: more than just analysing figures

A purchase price calculated on the basis of a maximum rent and a low purchase price factor is often only attractive at first glance, but does not ensure a sustainable investment. The decisive factor is that the rent must be realistic in order to secure a return. For this purpose, it must be reliably calculated: Can the operator refinance the rent to be paid? Our commercial due diligence is therefore an indispensable part of a well-founded purchase review and completes the legal and technical due diligence. At the end, we will provide you with a meaningful opportunity/risk profile and a recommendation for or against the purchase.

Transaction security: your partner from analysis to signature

Transactions in the social property market are complex and involve risks. With our 30 Years of experience in the German market, we are well aware of all the potential pitfalls. We act as your fiduciary partner, guiding you safely through the entire process. We also contribute our expertise to contract drafting and act as an interface between all parties. From the initial interest to the final signature at the notary’s office, we are at your side.

“We know the potential pitfalls when buying or selling social properties – and we make sure you don’t stumble over them.“
Markus Bienentreu

Real estate & operator brokerage

Frequently Asked Questions (FAQ)

A traditional M&A advisor is an expert in general transaction processes. However, they usually lack specific knowledge of the highly regulated social property market. We combine transaction expertise with in-depth knowledge of areas such as federal state home laws, refinancing rehabilitation clinics, and the specific management of social facilities. This unique combination is crucial for correctly assessing risks and potential.

The most common omission is an overly superficial examination of the operator and its concept. While creditworthiness is often checked, the long-term profitability of the facility is not. Do the operating and property concepts really suit the location and each other? Is the personnel strategy sustainable? An operator that is healthy today may encounter problems tomorrow due to new, uneconomical properties. It is therefore essential to assess future viability.

Professional preparation speeds up the sales process considerably and maximises your earnings. By proactively identifying potential problems, you create trust and transparency among bidders. You avoid unpleasant surprises in late negotiation phases, can justify a higher purchase price and shorten the inspection phase for the buyer.

The duration depends on the complexity of the property and the quality of the available documents. As a rule, you should plan a period of four to eight weeks for a comprehensive inspection. This process includes data analysis, location inspections, expert interviews and the preparation of a detailed audit report with clear recommendations for action.

Be wary of above-average yield promises that are not clearly justified. Other warning signals include vague information on the lease terms or stagnating occupancy rates over the years. An outdated operating concept or a high maintenance backlog also indicate hidden risks that require close examination.

TERRANUS Geschäftsführer Markus Bienentreu

Would you like to discuss your project with us?

Fon +49 221 93 700 700

markus.bienentreu@terranus.de

Markus Bienentreu

Real estate and operator brokerage

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