Off-Plan Acquisitions: Due Diligence Protocols and Risk Containment
Verifying building permits, developer solvency, municipal land registration, and structuring milestone payment protections.
Off-plan acquisitions allow buyers to purchase property at competitive valuations before project completion. However, this structure introduces developer insolvency and planning non-compliance risks, necessitating strict legal due diligence prior to signing.
1. Verifying Building Permits and Municipal Approvals
We audit the municipal planning files under Law 90/1972 to confirm that the project has active, non-conditional building permits and zoning approvals. Purchasing an unapproved project exposes the buyer to structural non-compliance penalties or demolition risk.
2. Assessing Developer Solvency and Land Ownership
We verify that the developer holds clear legal title to the land under Cap. 96, or that joint-venture agreements are registered with the Land Registry, preventing developers from double-mortgaging the property or using client funds to settle unrelated debts.
3. Structuring Milestone-Based Escrows
We structure purchase contracts where buyer funds are deposited into restricted escrows, released only after independent building control authorities certify construction milestones. The contract is registered under Law 81(I)/2011 to secure specific performance rights.
This briefing is prepared for general informational purposes and does not constitute direct legal advice. Clients are advised to complete independent compliance and conflict verification before making capital commitments.
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