To check out the financial strength of the property, investor should not
only look at the leases and lease-related information as described
above, but also several other categories of information, including
those listed below and the tax-related issues covered later in this
article.

· Appraisal. Third-party analysis and valuation reflecting the current
market.

· Audit. Audit of operating and other expenses. The intensity and nature
of this audit may vary with circumstances.

· Brokerage Commissions Due. Future payments of brokerage commission for
existing leases already in place.

· Budgets. Operating budget for the current year. Seller’s budget for
capital projects, or anticipated schedule of requirements.

· Financial Reports. Property financial statements for the last several
years.

· Insurance. Analysis of future insurance coverage requirements and
likely cost, including a comparison with seller’s cost of insurance.

· Operating Expense Changes. Possible changes in operating expenses
after the change of ownership.

· Percentage Rent. Sales reports from percentage rent tenants.

· Receivables. Amount, composition, and implications of seller’s
receivables from tenants (part of rent roll analysis).

· Service Contract Costs. Analysis of the cost of service contracts and
possible alternatives after the change of ownership.

· Staffing. Employee roster and compensation. Future staffing changes
for building. Impact of union contracts, if any.

· Tax Returns. Review of seller's tax returns and underlying schedules;
comparison against other financial reports and information.

· Tenants. Analysis of financial condition of tenants (particularly
major tenants) and their financial statements, if available.