Thorough due diligence is the foundation of every successful real estate development and investment. Inadequate due diligence is a primary cause of project failures, cost overruns, and investment losses. BDP Development shares our comprehensive due diligence framework, refined over 25 years and 1,500+ projects.
Legal and Title Due Diligence
Legal due diligence confirms clear, marketable title to the property and identifies any encumbrances, liens, easements, covenants, or restrictions that could affect development potential or future value. Key checks include: title search and opinion, survey review, existing lease and tenancy review, planning and zoning compliance confirmation, covenant and restriction analysis, and environmental liability review.
Physical and Technical Due Diligence
Physical due diligence assesses the existing conditions of the site and any structures to identify issues that affect development feasibility or cost. Key investigations include: topographic and boundary survey, geotechnical investigation (soil bearing capacity, groundwater, seismic risk), environmental Phase I and II assessment (contamination), structural assessment of existing buildings, utilities and infrastructure capacity verification, and flood risk assessment.
Planning and Regulatory Due Diligence
Understanding what can be built on a site is critical to investment feasibility. Planning due diligence covers: zoning and land use designation review, development standards (height, density, setbacks, parking), planning history and precedent analysis, pre-application meetings with planning authorities, heritage and cultural resource assessment, and transportation impact requirements.
Financial Due Diligence
Financial due diligence for development sites establishes the financial viability of the proposed development. Key components include: comparable land transaction analysis, development cost estimation (construction, professional fees, financing, contingency), revenue projection (comparable sales/rents, market demand analysis), financial feasibility modeling (profit and loss, cash flow, returns), and sensitivity analysis. BDP Development’s financial analysis team conducts rigorous feasibility modeling for all project opportunities.