PARTIES/LEGAL REPRESENTATION/ TYPE OF DISPUTE Both parties legally represented INSTRUCTION: Provide expert’s report about losses sustained…
Due diligence
PARTIES/LEGAL REPRESENTATION/ TYPE OF DISPUTE
The inquiry was with regard to the selling price of a shopping centre.
The purchaser wanted to know what one might offer as “fair value” on the property
DESCRIPTION OF DISPUTE
The asking price was over $20 million
Analysis of leases, and the quality of income streams warranted offering between $13 and
$15 millio
$15 millio
How it was settled
There is some interest regarding the offer that has been made by the potential buyer (the client)
Without further instruction to carry out proper due diligence, it has not been possible to fully verify whether the proposed offer is realistic. The current owners (who invested further capital on renovating/refurbishing): could have paid too much because they did not carry out their due diligence and are seeking to recoup their “sunk cost” plus additional capital outlaid
Financiers, potential investors and other related parties (shareholders for example) need to know about these matters, in order to assess risk on income streams
