How to Mitigate Risk When Waving Contingencies

GlobeSt.com (September 23, 2019) With limited investment opportunities and high competition, investors are waving contingencies to win deals. Known as sign-and-go-hard transactions, these deals give an investors a competitive edge, but they are also higher risk. Still, buyers have options to protect against the inherent risk that comes with sign-and-go-hard deals. “During purchase agreement negotiations, buyers can negotiate specific seller representations to insure against the risk they would typically investigate during the diligence period,” Alain R’bibo, a real estate attorney at Allen Matkins, tells GlobeSt.com. These representations can address due-diligence concerns, adds Allen Matkins real estate attorney Shannon Snell. “Sign-and-go-hard buyers should negotiate representations which address key diligence-related concerns, such as the legal compliance of the property and its existing uses, the environmental condition of the property, the status of existing or pending litigation against the seller or the property, the status of entitlements and conditional use permits, and, if there are leases, the seller’s compliance with its obligations as the landlord,” Snell tells GlobeSt.com. Read More (subscription required)