The Investment Property Forum has launched two standard agreements dealing with confidentiality and exclusivity, which are intended to save time and costs during early negotiations in real estate investment transactions.
The IPF has released its standard form non-disclosure agreement and exclusivity agreement, intended to be used by the parties with minimal changes when a seller makes the agreements with prospective buyers directly or via an investment agent, granting a specified period for exclusive review of certain marketing material about the property and to begin due diligence.
The IPF believes the two agreements offer a fair and reasonable position for both parties and reflect current general market standards.
Dan Buckle, legal counsel at Aberdeen Asset Management and a member of the IPF working group explained: “On a daily basis, I and other members of the legal department spend a disproportionate amount of time reviewing and negotiating NDAs, as each one tends to differ in content, substance and form. After speaking with in-house lawyers at our competitors (all of whom had experienced the same issue), I suggested the introduction of an industry-backed template NDA, to create greater efficiency and to try to avoid protracted early stage negotiations. There was overwhelming support from everyone I spoke to and we agreed to contact the IPF to pursue the idea further.”
Ciaran Carvalho, head of real estate at Nabarro and chair of the IPF and the working group added: “I hope that even those organisations wedded to their own forms of these agreements will consider adopting the standard forms. They allow everyone to focus on the transaction itself rather than on spending time and effort negotiating documentation that relates solely to the transaction process. The forms should help reduce costs and transaction times for buyers and sellers.”
Copies of the two agreements and their respective set of guidance notes are available to download free-of-charge from the IPF website >>
