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TRUE DILIGENCE

Representative Properties

 

TrueDiligence has proven beneficial for buyers and sellers of commercial real estate throughout the United States.

 

Hotels and Resorts

Malls and Shopping Centers

Office Buildings

Retail Establishments

Multi-Family Housing

Senior Living Facilities

     

 PARTIAL LIST

TrueDiligence™ for Buyers and Sellers of Commercial Real Estate

 

TrueDiligence™ is a comprehensive suite of property tax and related due diligence services that provides valuable insight and information to Buyers and Sellers of Hospitality and other commercial real estate. 

 

Developed by Aspen Resource Group through decades of property tax and transaction support engagements, TrueDiligence™ allows participants to model unlimited permutations of financial assumptions and price allocation scenarios and provides immediate and supportable tax projections for use in underwriting and price negotiation.

 

How It Works

 

TrueDiligence™ is a combination of our proprietary tax analysis and optimization software tool, complemented by our proven property tax strategies and remedies that can be applied to achieve optimal tax and NPV outcomes. 

 

Our TrueDiligence™ software tool incorporates decades of experiential knowledge with real-time policy and practice research and local market tax intelligence.  Using your financial and transaction structure assumptions and projections, TrueDiligence™ can:

 

  • Provide multi-year projections for real and personal property tax based on a sale price, income and/or local market conditions and planned PIP among other factors.

  • Provide portfolio level guidance at incremental price and asset allocations to calculate the effect on real estate, tangible personal property, transfer and sales taxes.

  • Allow buyers to achieve increased confidence in the property and transfer tax assumptions resulting in more accurate value estimates.

  • Gather and document current tax policy and practice intelligence to support underwriting assumptions and price negotiation.

  • Solve for an optimal deal structure to achieve desired tax or allocation outcomes within predefined limits and client-specified constraints.

  • Identify and recommend specific actions and strategies that will minimize negative tax consequences created by an acquisition. 

 

Pricing

 

Aspen Resource Group provides basic TrueDiligence™ services on a complimentary basis to current clients for pre-assigned assets that are actively being negotiated for purchase.

 

Fee-based solutions are also available on an a la carte or all-inclusive basis with pricing determined by transaction size and complexity, geographic dispersion, and the specific services selected. 

 

TrueDiligence™ services include:

  • Tax Projection

  • Allocation Analysis

  • Optimization Study

  • Acquisition Support Services

  • Tax Proration (Review/Preparation)

 

In addition, we also custom-tailored solutions to meet the highly specialized needs of buyers and sellers of portfolios and properties throughout the United States.

Aspen Resource Group is positioned to act quickly to effectively respond to your specific transaction requirements throughout the United States.

 

 

TrueDiligence™ is a trademark of Aspen Resource Group.

CASE STUDIES

A TrueDiligence evaluation and report provide measurable results for our valued clients during the sales and acquisition phase.

 

Aspen Resource Group has produced significant property tax savings for our clients. We proactively mitigate tax increases through proactive and highly effective assessor negotiations and intelligence reporting

 

Below are representative examples of how our TrueDiligence services have benefited property owners involved in the purchase and selling of commercial properties throughout the United States.

 

WASHINGTON DC | ASSESSOR RESOLUTION

 

Challenge:  An institutional investor acquired an office building and hotel on the same tax parcel in Washington, DC.  The seller had sub-divided the main parcel so that the office and hotel could be sold separately.

 

The Washington, DC Office of Tax and Revenue then reassessed all parcels and arrived at a total assessment that was greater than had existed prior to re-parceling.

 

Solution:  We met with the DC Office of Tax and Revenue and demonstrated to them that they had erroneously increased the assessment via the re-parceling project.  We provided detailed income and expense analyses for the office building and hotel which supported the pre-acquisition assessment. 

 

Result:  The assessment was reduced back to the pre-acquisition level at the assessor level appeal resulting in $120,000 in reduced real estate taxes.

 

WASHINGTON DC | BUYER AND SELLER ALLOCATION RESOLUTION

 

Challenge:  Our client purchased a limited-service hotel in Washington DC for $75,000,000.  The assessment at the time of purchase was $47,000,000.  Buyer and seller were unable to agree on an allocation of the transaction price and a real estate value of $73,000,000 was recorded for transfer tax and recordation purposes.  This transaction created a potential annual real estate tax increase exposure of $550,000.

 

Solution:  We completed a State and Local Tax Allocation, and provided a comparable assessment study and income and expense analysis to the assessor while he was working on the upcoming assessment roll.  

 

Result: After several rounds of negotiations with the assessor and his supervisor, we reached a settlement at a value of $47,400,000, effectively eliminating the possible $500,000+ tax increase.

 

MIDWEST | RETAIL RECOVER RESOLUTION

 

Challenge:  A client specializing in retail assets was looking at a Center in the Midwest that had some cost recovery challenges.  Specifically, one of the out parcels was significantly undervalued and the excess value was placed on the main parcel.

 

Solution:  We worked proactively with the local assessor to move value from the main parcel to the out parcel so that the out parcel assessment was in line with the fair market value and the main parcel had more manageable recovery.

 

Result:  Fair market value achieved and liability reduced.

 

CALIFORNIA | PROPOSITION 13 RESOLUTION

 

Challenge:  An institutional hotel investor paid $50,000,000 for a select-service hotel in Southern California that had an existing assessment of $25,000,000.  The Purchaser was looking for a way to keep the post-acquisition assessment under $40,000,000 in order for the deal to pass underwriting.

 

Solution:  We recommended an independent State and Local Tax Allocation that would provide guidance with respect to the recorded real estate transfer value.  Additionally, we performed a modified Rushmore Approach Income and Expense analysis that supported the purchase price allocation.  

 

Result:  All information was submitted in the PCOR and in direct negotiations with the assessor during the enrollment process, and the resulting assessment was issued at just over $35,000,000.