Commercial Real Estate Pro Network

Darrin: [00:00:08] James Kandasamy, what is the BIGGEST RISK? [00:00:11][3.6]

James: [00:00:11] I think the BIGGEST RISK, is not doing due diligence properly either on the physical property inspection or even on the you know the business plan right. To make sure your business plan is correct. Because when you buy a deal we always have to make sure that we understand everything about the deal. We're buying multi multi-million dollar deal that we are syndicating we have passive investor money in the line. Our money is on the line and we want to make sure that we do as much due diligence as possible. So, that because it is our list that I fear is always likely did I miss out something. I'm always checking and checking and checking and double checking triple checking and making sure that I know everything that I do. And and a lot of times this is being mitigated by our lender because we usually get like Fannie or Freddie and they do another round of checking. They do another on underwriting and they do another round of inspection on top of we are doing right. But that's also risk when you go and take other smaller loans like community bank loans and normal loans because they're not as thick as what the agencies are. And because they're not being straight they may keep out things and we as a sponsor may be maybe stuck with something that we should have done. I mean you are alone in that case right. The lenders are not doing their due diligence you are alone. So I think people who have no known agencies loan or a lender which doesn't really stress on the on the inspection side of it and you want to be very very careful and you wanted to double triple check on your own. Because, you can you can end up you know with a big loss if you found something that you didn't expect.