Due diligence is a comprehensive, systematic review process aimed at evaluating all relevant information about a company, transaction, or project before making a decision. The review focuses on legal, economic, tax, and financial conditions to minimize risks and identify potential issues before making an informed business decision. Typically conducted by the potential buyer, it involves experts and often external advisors. Key information sources include company documents and discussions with management when assessing a company.
In the real estate sector, due diligence is crucial when buying or selling a building or complex. The goal is to ensure there are no hidden defects or financial risks. Relevant sources include blueprints, permits, environmental regulations, maintenance histories, and energy efficiency reports. In large construction projects, a thorough review can help secure timelines and budgets. Additionally, the process may reveal opportunities to enhance energy efficiency.
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