300 Unit Bid Questions

[Fred Gaston]

Thanks in advance for your thoughts.  My investors & I made it to the final round of bidding on a 300 unit apt bldg in the Southeast and I have some questions.  We all have varying levels of RE investing experience, but only one of us has multi-family experience, and that's on two 30 unit buildings, so we're pulling a Jonathan Twombly!

1. The broker indicated that size of due diligence fee would be a major factor in their decision, even more so than final offer price.  Any DD fee can be subject to whatever terms we might offer but would not be refunded should we pull out of the offer after contract is accepted.  So my question is besides legal, title and environmental inspection, what other contingencies would you require, and if we're "all in" on the deal, is there a danger to agreeing to a high DD fee to try to win the deal?
2. The other important lever for the owner is capital improvement plan.  The property has been neglected by the owner and one building is completely down, so this is ironic but he's offering seller financing and wants to protect his debt risk.  The seller wants a capital improvement escrow account setup at closing and he would approve withdrawals.  Is this reasonable?
3. Given our inexperience with a deal of this size, would you suggest hiring any type of expert to either review the deal or bring onsite before the final bid is due.  I was thinking a commercial inspector could help us with our capital improvement budget and advise on any major potential problems we are unaware of.

Thanks again, Fred

[Nick G.]

Speaking of the man, it definitely sounds like a question for him if you haven't asked him already. @Jonathan Twombly