Property Transactions
Avanko Capital provides a wide range of real estate investment advisory services and expertise with a special focus on property related mergers and acquisitions and property transactions. Our main goal is to serve the property related objectives of clients who are interested in buying ready-to-use properties (e.g. office buildings or industrial premises for own use, or let premises generating stable cash flow) or land plots/brown field sites for the construction of new premises.
Property transactions services:
Our key and specific competence in property transactions support the following client groups
1. For clients interested in investing in real estate in Russia:
- Knowledge of the current state and development trends of the Russian real estate market.
- Understanding of the basic obstacles that occur with Russian property owners (private owners and state bodies), their basic requirements and expectations.
- Comprehensive approach in the search for prospective property for acquisition (taking into account infrastructure, labor force, logistics and raw materials supply requirements etc).
- Due risks analysis (both in the process of the land-plot acquisition and further new premises construction) and deal structuring based on the identified risks.
- Comprehensive risks analysis related to required utilities (availability, costs, and obstacles for obtaining permits for connections).
- Knowledge and opportunity of attracting reliable utilities service suppliers for providing services related to utilities networks design, obtaining all required permits for construction, construction and commissioning.
2. For clients interested in selling their premises:
- Knowledge of and access to the main international and local property investors.
- Knowledge of the international standards of the property sale process.
- Understanding of the international investors' decision-making process and key requirements for the project's approval.
- Wide network of reliable and professional experts involved in real estate operations worldwide.
Acting on the buy side our main goal is to identify and successfully acquire premises with the feasible price, minimum risks and avoidance of any unpredictable costs related to further object development or operation.
We believe that the development of the comprehensive requirements of the property to be acquired is the main factor in successful deal implementation. This analysis has to take into account the needs for infrastructure, labor force, logistics, raw materials delivery, etc., (green field projects), or existing, announced and future area development and investment projects, main trends and driving forces on the market, state authorities' plans for area development, etc. (existing cash-generating properties).
By taking into account these factors, the property acquisition process will be effectively structured and successfully implemented. The detailed structure of the acquisition process is presented here.
Acting on the sell side our aim is to achieve the best result (from value and terms points of view) for the client with reasonable responsibilities and warranties. We consider that selling a property is more or less the same as selling a company. We follow the same structure and strategy when implementing property sales transactions (see structure - link).
We believe that only a comprehensive approach and diligent implementation of all processes during the sale can achieve the best result and ensure the success of the project.
Typical sale process through an open tender procedure
1. Pre-sale review
- Validation of the reasons for sale
- Defining the deal perimeter
- Preliminary analysis of potential buyers universe
- Identifying value drivers and planning actions to get the best of them
- Valuation
2. Strategy development and project planning
- Defining the sale strategy (prospective buyers, direct approach vs. formal auction, possible responsibilities / warranties, support in further object development, etc)
- Project planning (timing, milestones, and project team)
3. List of buyers and information documents
- Long list of potential buyers
- Information documents: brief profile (teaser), information materials (memorandum, presentations, etc.)
4. Tender
- Distribution of the teaser
- Signing of the Non-Disclosure Agreement with interested parties
- Distribution of the process letter and information materials
- Organisation of site visits
- Negotiations and collection of non-binding offers
- Selection of priority buyers to continue
- Coordination of data room- access to key information about the object
- Selection of the best proposal, signing of Letter of Intent (Memorandum of Understanding)
5. Confirmatory Due Diligence and legal documents drafting
- Coordination and support of the Due Diligence process
- Negotiations on the impact of Due Diligence results on the transaction value
- Coordination of the drafting of transaction documents (SPA, etc) with lawyers
6. Final negotiations and signing
- Final negotiations and signing of the transaction documents
7. Closing
- Control over fulfillment of the conditions precedent
- Closing
