About this video
Ellie reads a Tokyo office's technical due diligence, including Japanese reports, and finds the seismic risk the IM understates.
Full description
The information memorandum and engineering report give Project Wisteria a 9.8% earthquake PML, assuming the 2006 retrofit covered the whole building. The Japanese completion report shows braces on floors 1 to 4 only. The buyer's seismic assessment gives 16.4%, above the lender's 15% limit. Strengthening costs ¥318m and brings PML to 9.5%, with the capex and price consequences laid out for the committee.
Key points
- Seismic PML traced back to what the retrofit actually covered
- Japanese completion report read against the English IM
- Loan condition breach found before signing
Part ofAcquisitions & due diligence
Video details
- Roles
- Investor / LP, Lender
- Processes
- Due Diligence, Acquisitions
- Geographies
- APAC
- Markets
- Japan
- Tags
- author-demo-2, technical due diligence, seismic, Japan