disaster resilient and AFFORDABLE real estate DUE DILIGENCE

APKA due diligence in real estate property buying involves thorough research and assessment of a property’s legal, financial, and physical aspects – to take informed, risk-free investment decisions. APKA conducts a thorough due diligence as mandated by its Funder before financing a project. This essential process involves examining legal documentation, financial records, property condition and market analysis to minimize risks and take informed decisions. APKA Due diligence is conductor upon the explicit request and in the Fund prescribed format to help the investors understand a property’s value, potential challenges, and prospective opportunities.

APKA due diligence framework in real estate involves the following steps conducted by accredited and regulatory certified institutions :

1. Document review: Gather and review all relevant documents related to the property, including titles, deeds, surveys, zoning records, environmental reports, leases, financial statements, and any other legal or regulatory documents.
2. Physical inspection: Conduct a thorough physical inspection of the property to assess its condition, including the building structure ( if Any), systems (electrical, plumbing, heating, ventilation, air conditioning), grounds, parking areas, etc.
3. Financial analysis: Evaluate the financial aspects of the property, including rental income, expenses, operating costs, property taxes, insurance, and potential for future cash flow. This analysis may involve financial modeling and projections.
4. Legal assessment: Review all legal aspects of the property, including title searches, easements, encumbrances, liens, zoning regulations, permits, and any pending litigation or legal issues that may affect the property’s ownership or use.
5. Environmental assessment: Conduct environmental site assessments, to identify any existing or potential environmental liabilities or risks associated with the property.
6. Market analysis: Evaluate the property’s location, market demand, competition, trends, and potential for future growth or depreciation to assess its long-term viability and investment potential.
7. Negotiation: Based on the due diligence process findings, negotiate any necessary adjustments to the purchase agreement, address issues, and resolve any concerns.

1. Address and Location: Full address, city, state, zip code. Is the property in special zoning district?
2. Type of Property: Residential, commercial, industrial, mixed-use, etc.
3. Age of Building: When was it built? Last major renovation?
4. Ownership Details: Owner's name, ownership structure (LLC, partnership, individual, etc.).

1. Title and Deed: Is there a clean title? Any liens, encumbrances, or easements?
2. Zoning: Current zoning laws. Any pending zoning changes?
3. Permits: Are all current permits in place? Any pending permits or violations? Verify and Validate FSA compliance.
4. Legal Disputes: Any current or past legal disputes involving the property?
5. Environmental Issues: Any known environmental hazards? Compliance with environmental laws?
6. Check Ownership: Ensure the seller has a clear title to the property without any disputes.
7. Encumbrance Certificate: Verify that the property is free from any legal dues or mortgages.
8. Mother Deed: Review the property’s history to trace ownership.
9. Approval from Local Authorities: Confirm that the property has all necessary approvals from local authorities, including land use, building plans, and occupancy certificates.
10. Compliance with Zoning Laws: Ensure the property adheres to local zoning regulations.
11. NOC (No Objection Certificates): Obtain NOCs from the municipal corporation, electricity, water, and other relevant authorities.
12. Land Conversion Certificate: Ensure agricultural land has been legally converted for non-agricultural purposes.
13. Property Taxes: Check if property taxes have been paid up to date.
14. GST and Other Taxes: Ensure compliance with applicable taxes such as GST for under-construction properties.
15. OC Verification: Ensure the builder has obtained an Occupancy Certificate (OC), which indicates that the property is ready for possession.
16. Historical Preservation: Is the property in a historic district with preservation laws?

1. Project Cost: How was this price determined?
2. Income and Expenses: Historical financial statements for the property. Current income sources?
3. Tax Information: Current property taxes, any tax abatements, or exemptions?
4. Insurance: Current coverage details, any claims history?
5. Utilities: Who pays for utilities? Any utility company agreements?
6. Review Rent Roll
7. Review Leases (incl. amendments, extensions, modifications, guarantees, and estoppels)
8. Lease Abstracts
9. Review Accounts Receivable and Delinquencies
10. Review Reconciliations (if any)
11. Balance Sheet (3 years)
12. Check register for prior year and Y-T-D
13. Complete General Ledger for prior year and Y-T-D
14. Check sales histories for tenants that report, Y-T-D and last 3 years
15. Review tax bills for past 3 years
16. Schedule of Capex past 3 years and current budget
17. Recovery worksheet for Circular Transition Indicator CTI
18. Current month's TI
19. Schedule of tenants security deposits
20. Schedule of any outstanding TI and/or leasing commissions
21. Review utilities records
22. Current invoices for service contract providers and utilities
23. Review Insurance Quote
24. Copy of loss report from insurance company for last 3 years
25. Cash Flow Analysis: Projected income vs. expenses.
26. Break-even Analysis: 
27. Appreciation Potential:
28. Risk Assessment: Financial, operational, legal risks.

1. Site Plans & Building Plans (incl. any warranties from subcontractors)
2. Existing Phase I Report
3. Insurance Quote
4. Review Power Of Attorney docs (if applicable)
5. Review Easement Agreements (if any)
6. Review Building Service Contracts (incl. leasing and property management)
7. Review Maintenance Log & Capex
8. Warranties
9. Property Management Agreement
10. Contact Tenants & Create Contact List
11. Certificate of Insurance
12. Copies of all zoning and other governmental permits/ written confirmation
13. Existing ALTA survey
14. Certificate of occupancy, improvements, renovations for past 2 years
15. Existing property condition reports
16. Copy of any zoning reports (PZR)
17. Equipment warranties for all mechanical and structural systems (HVAC, roof, etc)
18. Notice of any current or pending litigation, citations or violations.

Circular Transition Indicators (CTI) framework serves as an invaluable resource for many companies in understanding circularity and learning new insights about their business in the process. Built for business, by business, CTI provides a simple, consistent and sector-agnostic way to measure circularity. Its transparent, quantitative and comparable metrics support companies in taking action to increase circular sourcing, identify opportunities to improve resource recovery and effectively close loops. 

1. Occupancy: Current occupancy rate, tenant profile, lease agreements?
2. Maintenance and Repairs: Recent major repairs, maintenance schedule, condition of systems (HVAC, plumbing, electrical)?
3. Management: Who manages the property? Management fees?
4. Service Contracts: Any ongoing contracts (cleaning, landscaping, security)?
5. Asbestos/leads: Presence of any other hazardous material.
6. Obtain current Certified Rent Roll
7. Receive/review Leases, Amendments and all related documents; prepare Lease Summaries
8. Engage Legal Counsel to review Leases and prepare Lease Summaries
9. Compare Internal Lease Summaries to Legal CounselÕs Lease Summaries
10. Compare Lease Summaries with Rent Roll and Pro Forma
11. Review Tenant Lease Files
12. Resolve issues regarding Leases
13. Review Tenant Correspondence Files
14. Compare expense pass-throughs/CAM charges to Operating Statements
15. Review cost pools for overcharges to tenants
16. Receive/review tenant sales reports
17. Receive/review list of security deposits
18. Receive/review aged receivables report
19. Review tenant credit information, payment history
20. Review Leases for any contractual Landlord obligations (i.e. construction, payments to tenant)
21. Compare square footage between Leases and Rent Roll
22. Prepare Tenant Estoppel Certificates
23. Review signed Tenant Estoppel Certificates
24. Cross-check signed estoppels against the rent/deposit schedule

1. Structural Integrity: Any signs of structural damage?
2. Building Systems: Condition of heating, cooling, electrical, plumbing systems?
3. Accessibility: Compliance with ADA (Americans with Disabilities Act)?
4. Safety: Fire safety systems, security measures?
5. Quality of Construction: Inspect the quality of construction, including materials used, finishing, and workmanship.
6. Amenities and Facilities: Ensure all promised amenities and facilities are provided.
7. Neighborhood and Infrastructure: Assess the surrounding area for essential infrastructure like schools, hospitals, transportation, and shopping centers.
8. Code compliance. Ensure that the property meets all applicable building codes and safety standards.
9. Receive/review as-built plans/specs (electrical, mechanical, structural)
10. Receive/review existing inspection reports (roofing, HVAC, seismic, soils)
11. Order current engineering report (Property Condition Assessment), to include structural, mechanical, code compliance and ADA compliance.
12. Receive/review existing environmental reports and studies
13. Order current Phase I Environmental Site Assessment
14. Order current Additional Site Investigation (Phase II)
15. Receive/review building permits, licenses, certificates of occupancy
16. Verify parking is adequate (i.e. governmental regulations, practical requirements, lease requirements)
17. Verify approximate sf of improvements
18. Review utility site plan, verify adequate utility hook-ups, verify all utility hook-up fees paid, identify requirements for utility deposits
19. Review energy usage reports; compare usage to expenses
20. Verify amount of available wattage psf and compare to market
21. Receive & review construction contracts/subcontracts
22. Receive & review building warranties/guarantees
23. List of personal property and trade/service names
24. Copies of liability, casualty and other insurance
25. Site plans, leasing brochures, maps and photographs

1. Describe any past criminal or administrative proceedings or investigations against the Firm, its affiliated entities  and/or its current and former Team Members.
2. Describe any past investigations by an industry regulatory body of the Firm, its affiliated entities and/or its current  or former Team Members.
3. Describe any pending or ongoing litigation/investigation against the Firm, its affiliated entities and/or its current or  former Team Members. 
4. Describe any accusation and/or conviction of fraud or misrepresentation against any of the Firm’s current or  former Team Members. 
5. Describe the activities of the Firm’s support functions (Finance and Project Management, Human Resources, Compliance/Legal, etc.).
6. Detail the processes and procedures for internal capital movements (capital calls, transfers of cash, investment  acquisitions and distributions).
7. Provide an overview of the third-parties providing services to the Firm or Project (e.g. law firms, custodians, project administrators, prime brokers, consultants, banks, etc.).
8. How does the Firm manage counterparty risk related to  these third-party arrangements?
9. What types of insurance coverage does the Firm maintain (e.g. fidelity bond insurance, errors and omission insurance, directors and officers insurance, other)?
10. Provide a summary of any material claims made against these  policies in the last five years.
11. List and describe any software that the Firm uses for business functions like portfolio management, trade order management, administration and risk.

1. Local Market Trends: Recent market trends in the area, future development plans?
2. Comparable Sales: Recent sales of similar properties in the vicinity?
3. Demand: What is the demand like for this type of property in the area?
4. Sectoral Market Trends: Growth, decline, or stability?
5. Rental Market: Average rent for similar properties, occupancy rates.
6. Economic Influences: Local economy, major employers, new developments.

1. Development Potential: Any potential for expansion or redevelopment?
2. Future Projects: Are there any announced future projects nearby that could affect property value?

1. Property Taxes: Current rates and any potential increases.
2. Depreciation: For tax purposes.
3. Tax Incentives: Any local or state incentives for property owners.