CASE STUDY A Real Estate fund sells more effectively with VDR

In recent years, the real estate market in the CEE region has on one hand been driven by the growth of the e-commerce sector, and on the other – stopped by the price uncertainty caused by the pandemic. It was seen especially in the office sector, which had to unexpectedly adapt to the trends of remote working. In result, some investments were suspended, while others required to maintain a fast pace of proceedings due to price fluctuations and pandemic restrictions. What did VDR provide to our RE client in these changing circumstances?

Client:

A Real Estate fund operating in CEE

Transaction type:

Due Diligence, sale of commercial real estate

Target:

Sale of several companies managing commercial real estate

Our client, a Real Estate fund with an established position in the Central European market, needed a tool that would enable quick implementation of the Due Diligence process and the sale of real estate, and at the same time ensure:

• easy and constant communication with the investor
• keeping confidential documentation of high-value companies secure
• convenient participation in the transaction for target companies, the fund, as well as investors and advisers

The exit from the investment regarded several companies managing real estate portfolios in the retail sector. For the investor, a foreign company, it was important that the process run remotely, fast and without geographic or technical restrictions. Access to documentation had to be possible 24/7 so that document analysis could take place quickly, regardless of the investor’s time zone.From the perspective of the owners of the target companies and the fund, however, what was important was the ease of making required documentation available to the investor, and maintaining control over who will have access to it and to what extent.

Dealmaking in the Real Estate industry requires covenient realization online from any place. The client’s process had to run smoothly and quickly to secure project’s goals.

FORDATA Virtual Data Room system answered perfectly to the needs for secure and convenient confidential documentation exchange. Especially, when there appeared pressure to close the investment quickly.Under the contract signed with all target companies we have configured the system in such a way that individual parties had easy access to their own
parts of the project.Thanks to this, we were able to limit the risk of information chaos , which had a direct impact on the speed of completion of the real estate sale process.Documentation of each company has been clearly structured, and the system administrators gained full insight into what happens in VDR thanks to:

• Administrative reports, thanks to which the administrator could see, for example, who uploaded and/or deleted certain files, who changed file permissions and their names, or who moved documents in the structure
• Reports on the activity of external users, thanks to which the administrator could determine which documents were the most popular with the investor, to better understand their intentions, and to prepare for the Q&A session

The very process of uploading and sharing documents, thanks to, among other features, automatic operations for entire groups of users, was as fast and efficient as possible.Every time a new document was uploaded, the investors and their advisers received notifications.
They could also take advantage of the built-in Q&A module.

FORDATA
Virtual Data Room system was deployed specifically to ensure confidentiality of the shared documentation and to streamline the project.

It is once again worth referring to the needs that have arisen on the side of the owners and investors. Thanks to the shortening of the duration of the transaction, the owners – i.e. the target companies, and the fund itself, could also reduce the costs and risks arising from the uncertain market situation.We could see a similar benefit on the buy-side as well: shortening the Due Diligence proceedings results in, among others things, lower susceptibility to market fluctuations. Not only remote 24/7 access, but also the ease of navigating the system and finding interesting documentation have been particularly important to and appreciated by our clients.

Company owners could restrict costs and risk. Whereas the investor could benefit from lower susceptibility to market fluctuations and remote access.

The sale of all companies was successful and closed within the estimated time and without the need for involving significant resources. We are proud that FORDATA team has helped realize another multi-million dollar transaction in the Real Estate industry.

If you are interested in learning more about how FORDATA can assist your project, go to the section where we provide details on how VDR solutions can benefit transactions in the commercial real estate sector.