Real Estate ASC 805

Stout was engaged by a Washington, D.C.-based real estate fund to assist with ASC 805 needs in conjunction with the acquisition of a regional mall in the Washington metropolitan area. The acquired property was highly complex and involved multiple condominium and ground lease agreements. Furthermore, the allocation was to reflect a partial interest in the property and the overall transaction.

Our work included a review of both market-based and historical income streams, cash flow projections, closing statements, and other transaction due diligence. We projected cash flows for more than 60 tenant suites and ground leases, built out cost models, and discreetly valued the underlying land. We also valued various other real estate intangibles such as in-place leases, avoided lease-origination costs, and assessed favorable/unfavorable leasehold interests.

Our analysis was successfully reviewed by a national audit practice, and we were able to smoothly and efficiently assist our client with their purchase accounting requirements.