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Real Estate Due Diligence in Belgium

Real Estate Due Diligence in Belgium

Updated on Monday 22nd April 2019

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The due dilligence procedure in Belgium

 
Activities such as buying, selling, lending or managing commercial real estate require a variety of different types of commercial property due diligence in Belgium. There are many types of actions necessary and they differ from one country to another.
 
In Belgium, real estate due diligence is to be made before an acquisition of a real estate, when the buyers consider they would need more information regarding the legal and commercial status of the real estate. Usually, this involves the investigation of ownership titles and other rights, such as mortgages, easements or encumbrances. The rental status and validity of lease agreements, planning and zone situation, building permits, building contract and files are also investigated. In addition, environmental permits, soil pollution, insurance, waste, asbestos and other hazardous materials are among other investigated actions.
 
When performing a real estate transaction in Belgium, the seller must provide a different set of information to the buyer, or the buyer can investigate using public sources such as a notary, the cadaster, the mortgage office, or the public waste agency.
 
In Belgium, there are two main points used to invest in real estate: an asset deal, that involves the direct purchase of a property, and a share deal, which refers to acquiring shares in special purpose companies whose main assets are the underlying property. Long leases and superficies, also known as a temporary right since they offer a maximum duration of 50 years, are used as well. In addition, it is possible to perform a combination of the two, such as a direct sale of the right over a building alongside a sale of the shares of the entity owning the land.
 
The scope of the due diligence in case of a shared deal is broader, and it includes a financial, tax and corporate review of the company that transfers the shares.
 
Real estate due diligence in Belgium used in a commercial property transaction it also includes securing of a title insurance policy for the ownership of the property, as well as the encumbrances. Contact our lawyers in Belgium for more information on real estate due diligence in Belgium.

Technical due diligence applies in Belgium

As many European countries demand more and more technical due diligence reports, Belgium has also increased interest in this aspect. Usually, the technical due diligent details the physical condition of a property, information that is requested by financial institutions, investors and owners in the decision process of buying or selling a property. 

Institutional investors and private investors in Belgium

Pension funds and the favorable tax treatment of European funds are among the institutional investments, and they play an important part in the Belgian real estate market. When it comes to private investors, entities can close public real estate deals through PPPs in order to help the modernization of the public infrastructure, as well for the improvement of public services.
 
Investors interested in opening a company in Belgium that focuses on the real-estate business are obligated to obtain permits and permissions for each of the projects they plan on developing, in order to ensure that they follow the environmental law, urban planning and other regulations. Our Belgian law firm provides personalized consultancy for all types of businesses.