Real estate due diligence for a sale and lease-forward operation

A financier asked us for legal assistance with the acquisition of a hotel property valued at €2.5 million, followed by its transfer under financial leasing to the company that operates it commercially. At first glance, an ordinary commercial structure.

Beneath that appearance, however, our analysis brought to light exactly the risks that can turn a safe financing into a vulnerable one.

What the due diligence analysis involved

• We fully reconstructed the property's chain of title over more than two decades;
• We cross-checked the authentic deeds against the cadastral documentation, building permits and technical surveys — where we identified several discrepancies;
• We critically analysed the existing valuation report, exposing methodological inconsistencies that could have led to an overvaluation of the financier's collateral, and recommended redoing it on a correct basis;
• We carried out an in-depth analysis of the civil-law risks specific to Romanian law, relative to the parties' standing, coupled with a targeted tax assessment and a contractual strategy designed to fully protect the client's position against any subsequent challenge.

The outcome

A due diligence report and legal opinion structured across 16 chapters, with a clear set of conditions and recommendations — which allowed the client to make an informed financing decision, instead of proceeding on the basis of incomplete documents or a contestable valuation.

What due diligence means to us

This type of analysis shows exactly what due diligence means to us: not a formality, but the verification of all documents to obtain a clear and accurate picture of the legal situation of the property that is the subject of the financing operation.