How to compare material contracts in a diligence table for Commercial Property Dispositions

Compare material contracts by connecting each property-level agreement to the seller’s proposed disposition: what transfers, what requires consent, what must end, and who bears the cost or continuing obligation. Build a source-linked table covering operative terms, amendments, buyer elections, assignment restrictions, termination exposure, and unresolved facts. Reconcile those findings with the purchase agreement and proposed assignments. The deliverable is a reviewed comparison supporting accurate disclosures, seller decisions, and documented instructions for contract treatment at closing—not merely a list of vendors.

When to use this workflow

Use this workflow when seller’s counsel or an in-house real estate team must compare operating contracts before circulating disclosure schedules, responding to buyer diligence, or implementing assumption and termination elections. It is especially useful where a property manager holds the records or several buildings share vendors.

Include maintenance, security, elevator, utilities, waste removal, telecommunications, property management, and equipment agreements. Include warranties when transfer restrictions affect the sale. Keep lease abstraction separate unless a lease provision affects an operating contract, such as responsibility for equipment or services.

This is a US transactional workflow, not a litigation procedure. Contract treatment depends on executed language, governing law, facts, and transaction structure. The recommendations below are internal review practices; state-specific disclosure and enforceability questions require separate analysis.

What you need

Collect the executed purchase and sale agreement (PSA), amendments, service-contract schedules, buyer election notices, proposed assignments, and agreed termination forms. For underlying contracts, obtain signatures, amendments, statements of work, equipment schedules, renewal notices, side letters, and relevant correspondence.

Ask the property manager for a vendor register, accounts-payable records, and information about deposits, prepayments, disputed invoices, service interruptions, and contracts covering other properties. These records test completeness; an invoice does not establish every contractual term.

Record the anticipated closing date, election triggers, seller approval authority, and property-management contact. Assign stable document IDs before extraction.

Separate internal completeness requests from contractual production commitments. One SEC-filed PSA distinguishes materials delivered or made available from records available for inspection, with possession, control, and permission qualifications. Those negotiated provisions do not establish a universal duty to create missing records. See §§4.1–4.2.

Use the template

Use Commercial Property Dispositions — Material contracts comparison as the working template. You can copy this table into your working document or spreadsheet. Create one row per agreement family; use separate rows where property-specific terms require different decisions.

In Contract / sources, identify the counterparty, contracting entity, executed version, amendments, and clause/page citations. Use document IDs to connect each conclusion to its evidence; filenames alone are insufficient where versions conflict.

In Fees / balances, separate recurring charges from deposits, credits, prepayments, and disputed amounts, with an evidence date. Assignment / release records transfer restrictions, consent conditions, and seller-release status separately within the cell or linked note.

PSA treatment records assumption, rejection, termination, exclusion, or unresolved status, citing the election and relevant PSA provision. Gaps / exposure captures missing evidence, defaults, retained obligations, and uncertain allocation.

Use Action / owner for the next step, responsible reviewer, approval authority, and date or contractual trigger. Link longer source notes rather than compressing conflicting provisions into an ambiguous summary. Keep proposed, approved, and completed actions visibly distinct.

Step by step

1. Establish the comparison population

Start with the PSA’s definitions and schedules, then reconcile them with the manager’s contract register and vendor payments. Identify the signing entity and buildings receiving services. Flag portfolio agreements that extend beyond the property being sold.

Set an internal inclusion rule based on sale relevance: transfer restrictions, service continuity, termination exposure, deposits, performance disputes, or surviving obligations. Do not substitute an internal spending threshold for the PSA’s disclosure criteria. Preserve exclusion reasons for vendors that do not require substantive comparison.

Record: document and property IDs, contracting entities, inclusion decisions, and missing-document requests. Label an unlocated agreement “not located,” not “none.”

2. Assemble each operative agreement family

Read the base agreement with amendments, work orders, renewal notices, and incorporated schedules. Identify which document controls each relevant term. Check signatures and referenced attachments; label unsigned drafts without assuming they establish operative wording.

Separate absence of evidence from evidence of absence. A missing equipment schedule does not establish that no equipment remains onsite. Ask the custodian for the attachment and supporting performance records. Where documents conflict, retain both citations until a reviewer resolves precedence or seeks clarification.

Record: the controlling source for each field, version uncertainty, missing attachments, and the person responsible for obtaining them.

3. Compare duration and economic exposure

Extract commencement, expiration, renewal mechanics, notice requirements, recurring charges, and minimum commitments. Test notice triggers against the anticipated closing date. Do not assume a property sale creates a termination right.

For deposits and prepayments, identify the holder and dated balance evidence. Distinguish contractual refund rights from proposed closing allocations. Record disputed invoices and alleged defaults separately from established obligations, including relevant notices and responses.

A termination estimate should identify its source formula, assumed effective date, included charges, and verification owner. If timing or inputs remain uncertain, label the amount provisional rather than presenting it as a closing charge.

Record: term and renewal data, notice dependencies, dated balances, disputes, and verified or provisional cost treatment.

4. Analyze assignment separately from seller release

Identify restrictions addressing assignment, delegation, property transfers, or changes of control. Assess the contemplated transaction against the actual language; refer ambiguous provisions for governing-law review rather than deciding them from a shorthand summary.

Keep three questions distinct: can the agreement transfer, what evidence or conditions support transfer, and what seller obligations remain? Do not use buyer assumption language as proof of vendor consent or seller release. Examine guarantees, indemnities, and continuing payment provisions separately.

For shared agreements, consider whether the sold property needs a partial termination, amendment, or replacement agreement. Do not invent a property-level allocation unsupported by the documents.

Record: clause citations, consent and release status, retained exposure, and the precise unresolved question for counsel.

5. Reconcile buyer elections and negotiated exceptions

Map each finding against the PSA’s assumption and termination provisions. Check the buyer’s election, covered contracts, delivery evidence, contractual trigger, and amendments. Do not translate silence into acceptance without reading the actual mechanism.

The Dunwoody Station PSA illustrates the need to reconcile general definitions with specific arrangements. Section 5.7(b) defines designated contracts, including certain contracts where no election notice is delivered, but also records an election to terminate contracts and specific arrangements for identified vendors. It includes a Comcast exception, seller-paid termination fees, and survival language. These are negotiated terms, not evidence of unrestricted assignment or termination. See §5.7(b).

Record: election source, PSA section, exception, cost bearer, and any conflict requiring an approved resolution.

6. Assign decisions and verify supporting evidence

Separate missing facts, interpretation questions, buyer agreements, vendor consents, and commercial approvals. Give each issue an owner and escalation point. The manager may verify service history, counsel may address consent wording, and an authorized seller representative may approve expenditure or retained risk.

Check the table against disclosures and proposed assignments. An upload is not evidence that a closing condition is satisfied. The Dunwoody Station example conditions purchaser performance on material deliveries, materially accurate representations, and material covenant performance, subject to purchaser waiver. See §4.6.

Record: evidence, approved treatment, unresolved closing impact, and authority to seek any required agreement or waiver. Refer broader closing-condition administration to the closing checklist.

7. Issue a controlled comparison

Have a second reviewer check decision-driving entries against operative sources, concentrating on consent, renewal, termination charges, defaults, and surviving obligations. Confirm that requested actions are not marked completed without supporting evidence.

Date the comparison and identify its document cutoff. Preserve the internal version containing analysis and approvals. Prepare any buyer-facing extract deliberately, reviewing confidentiality and privilege before release. New documents should prompt review of affected rows, with changes traceable to their sources.

Record: review status, evidence cutoff, approved decisions, and assigned open issues. The final table should support contract decisions without replacing the underlying documents.

Worked example

The following parties, documents, amounts, and clauses are entirely fictional.

Juniper Quay Owner LLC is selling a two-building office property to Alder Span Investments LLC. Its initial comparison labels all vendors “buyer to assume.” Fictional PSA P01 §7 instead requires written buyer elections and assigns Juniper the costs of terminating rejected service contracts. It does not supply vendor consent or seller release.

Buyer notice B01 accepts elevator maintenance, rejects security, and omits telecommunications. Closing is expected six weeks after the comparison date. The election deadline remains open. The manager supplies three agreement families, but telecommunications attachments are missing. All underlying agreements identify Juniper as the contracting party.

The comparison changes three decisions. Elevator maintenance remains proposed for assumption, but consent and continuing-liability questions require resolution or express risk approval. Security needs immediate notice and service planning: six weeks is shorter than the contractual 60-day period even if receipt occurs promptly. Its final cost still depends on verified timing and charges.

Telecommunications remains unresolved while the election period is open. The team requests the missing documents and buyer position rather than inventing a default election or termination amount. The ledger supports a reported deposit balance, not a refund entitlement. The security invoice dispute also remains separate from prospective notice-period charges.

Common mistakes

• Comparing filenames instead of operative agreements. Link amendments and attachments before summarizing rights.
• Treating the vendor register as the disclosure schedule. Reconcile PSA scope, contracting entities, and shared-property coverage.
• Combining assignment, assumption, and release. Record the language and evidence supporting each conclusion separately.
• Treating rejection as completed termination. Verify notice requirements, receipt evidence, effective date, and charges.
• Reporting “no issue” where evidence is missing. Identify the gap, its decision impact, and its resolution owner.

Final quality check

• Every included agreement identifies the property and contracting entity.
• Operative documents and attachments are linked or explicitly missing.
• Decision-driving summaries match cited clauses and pages.
• Renewal and notice triggers are distinguished from anticipated closing.
• Balances and estimates identify evidence dates and assumptions.
• PSA treatment reflects elections, delivery evidence, and specific exceptions.
• Consent, release, and retained seller exposure have separate statuses.
• Open issues are resolved or assigned with authority, a next step, and a date or trigger.

Complete the workflow with DecoverAI

DecoverAI is the Legal Intelligence Platform for litigation and transactions. Its transactional capabilities support tabular review across documents, while due diligence classification can organize the document population and prioritize human review. Use those capabilities to support your working comparison, with counsel verifying sources, contract treatment, and unresolved exposure. To discuss this seller-side workflow, book a demo.

Frequently asked questions

Should every vendor appear in the comparison?

Reconcile every identified vendor against the contract population. Use PSA disclosure criteria and sale relevance to determine which agreements need substantive rows. Preserve exclusion reasons so an omitted vendor is not confused with an overlooked contract.

What if the manager has invoices but no signed agreement?

Record invoices as billing or service evidence, request agreements and correspondence, and identify the custodian. Leave unsupported terms unresolved. Counsel should assess the available evidence rather than assume that missing signatures establish either no contract or unrestricted termination.

Can an assumed contract be marked complete before consent arrives?

Keep buyer assumption intent separate from consent status. Review whether consent is required by the operative language and transaction. If required evidence remains outstanding, record the owner and decision needed instead of marking treatment complete.

How should shared-property contracts be compared?

Identify affected properties and the signing entity, then isolate the sold property’s services, charges, and proposed treatment. Where documents do not support allocation, seek clarification or negotiated documentation. Track effects on retained properties before approving partial termination or transfer.

Sources

• SEC-filed Purchase and Sale Agreement, June 8, 2010, §§4.1–4.2 — delivery and inspection provisions with specified qualifications.
• Post Apartment Homes–Dunwoody Station Purchase and Sale Agreement, March 4, 2009, §§4.6 and 5.7(b) — closing conditions and specific service-contract arrangements. These filed agreements illustrate wording, not market standards.

This guide is general information about legal workflows, not legal advice for any matter. It was drafted and reviewed with AI assistance. The worked example is fictional. Contract rights and procedure depend on the governing law, the actual wording, and the facts, so check the cited sources and the rules that apply in your jurisdiction before relying on it.