Tomlin Law takes a unique approach to the practice of real estate law by offering unbundled due diligence advice for real estate investors at a fixed cost. Tomlin Law’s clients turn to the firm for advice when they are taking an initial look at a property and are trying to decide whether or not to make an offer. Clients who have an accepted offer and need to fully understand the deal before closing on the transaction also hire Tomlin Law to take a more in depth look at the property. Tomlin Law allows investors to focus on the financial aspects of a deal while letting the firm handle the due diligence, including coordination of third parties such as consultants, title companies and surveyors. At all stages of a transaction clients can either choose unbundled individual services or a whole management approach.
Initial Due Diligence (pre-offer/initial review of potential deal):
Legal advisory services related to:
- Proposed deal terms, including review of any real estate broker deal sheets.
- Advantages and disadvantages of potential deal structures, including debt and equity financing.
- Limited property level analysis through review of publicly available records, including current ownership, recorded easements, mortgages and liens, building violations and general zoning issues.
- Property level legal risk analysis.
Due Diligence Management Services (prior to contract execution or during contract inspection period):
Tomlin Law works with its clients to develop a Due Diligence Plan to fit each specific transaction. The Due Diligence Plan may consist of any number of the following sub-services and where necessary, includes coordination of third parties such as consultants, title companies and surveyors.
- Property Operation Contracts: review of all operational contracts for property, including management and services contracts, in order to confirm operational costs presented in broker sheets.
- Leases: each lease will be reviewed for key terms and the impact of those terms on the deal structure. Pricing will be determined on the number of leases and whether they are commercial or residential.
- Title: review of all recorded documents, deeds, mortgages, easements, use restrictions and covenants. Title review will include ordering a title report from a title company and management of the title company to underwrite the deal at the lowest risk to the client.
- Survey: review of existing survey and ordering of an updated survey in conjunction with Title review to determine potential physical issues with site, title defects and property description. Survey review will include management of the surveyor to make sure that the client has an accurate depiction (and understanding) of the property.
- Environmental: order a Phase I Environmental Site Assessment (“Phase I ESA”) from appropriate consultant. If the Phase I ESA identifies any “Recognized Environmental Areas of Concern”, and the consultant recommended further action, Tomlin Law will work with the client in conjunction with the consultant to determine whether further environmental investigation is warranted in the context of the deal and, most importantly, assist the client in determining whether or not to proceed with the deal.
- Physical Inspection: Tomlin Law will hire the services of a building inspector or engineer, as necessary, to inspect the physical aspects of the building, including structural and roof issues. The results of this inspection will be important to the client’s perception of deal costs, especially with respect to future capital expenditures.
- Local Building Issues and Municipal Searches: the title company will order a municipal search. Combined with the information gained by the building inspector, Tomlin Law will advise the client on building department and other local agency issues, such as building violations.
- Zoning: Tomlin Law will order a summary zoning report from a national company, review same and advise client on the results. A summary zoning report will only be possible if certain zoning and property information is readily available. Full zoning analysis will require specialized third party legal advice.