Define the investment case
Decide whether you want income, appreciation or both, your holding period and how you will exit. This tells you what kind of asset and tenancy fits.
Title and approvals
Have your lawyers verify title back through the chain of ownership and check for encumbrances, disputes and lender charges. Confirm the building's approvals, including the Occupancy Certificate, and that the project is registered where the law requires it.
Tenancy and income quality
For a let asset, the income is the asset. Review the rent roll and every lease:
- Tenant strength and the length of the lease remaining.
- Lock-in periods and exit rights.
- Escalation clauses and renewal options.
- Arrears, disputes or requests for concessions.
- Whether the rent is at market or above or below it.
Understand the yield you are quoted
Ask how the yield was calculated: on which income, after which costs, and on which price. Gross and net yields differ, and outgoings, vacancy and capital expenditure reduce what you receive.
Outgoings and building condition
Obtain maintenance, property tax and utility records, and a technical inspection. Find out what capital works are due and who pays for them.
Taxes and costs
Allow for stamp duty, registration, GST where it applies, legal and advisory costs and any financing costs. Confirm the current position with your advisers. This guide is general information and not legal, tax or investment advice.
Plan the exit
Think about who the next buyer will be and what they will need to see. Well-documented leases, clean title and a stable tenancy make a future sale easier.
Frequently asked
What should I check before buying a let office?
Title, approvals, the rent roll and leases, tenant quality, outgoings, building condition and the taxes and costs of the transaction.
Why is the quoted yield not enough?
It depends on how income and costs are counted. Ask for the basis, and model vacancy, outgoings and capital expenditure yourself.
Do I need legal due diligence?
Yes. Title and approvals are the foundation of any purchase, and lawyers should verify them.
Related: Capital Markets & Investment Sales, Mumbai micro-markets, how we work.
