Regardless of whether it is a share deal or an asset deal, the underlying contracts usually contain detailed guarantee declarations from the seller. In the past, it was not uncommon to question the reasonableness of the scope and the associated expense. Driven by the rapid and thoroughly lucrative exit opportunities in recent years, these guarantee declarations were more of an annoying accessory that unnecessarily delayed negotiations, at least for the predominantly commercially-minded parties involved. And now, after the much-vaunted turnaround?
Suddenly, attitudes towards and the handling of such guarantee declarations have changed abruptly, particularly with regard to contracts that have already been concluded. If an originally planned exit strategy cannot be pursued - as is not uncommon at present - and a new one is not on the horizon, longer holding periods are the result. Short and medium-term financing must be extended at higher interest rates. Now it is the business people among the real estate players who are looking at the one or other contract that has already been filed and searching for an economic balance. This necessity is reinforced not only by internal objectives, but also by external requirements, particularly from creditors and financing partners. The sometimes forced change of strategy from "trade" to "portfolio" brings completely different factors of the original deal into focus, which - fortunately - have mostly become part of the seller's guarantees due to the meticulous thoroughness of the lawyers involved. The lawyers, much-maligned in the hectic market as "eternal doubters", are now back on the scene to check whether factors that are suddenly necessary for the imposed change of strategy are reliably present in the portfolio and can be underpinned by seller warranties and strengthened by legal consequences provided for in the contract. Whether every purchaser is able to benefit from the seller guarantees once signed is a question of the individual case, i.e. the structure of the guarantee declarations and in particular the legal consequences provided for a breach. In order to fully process the acquired portfolio and answer the questions posed by the financing partners, a comparison between guarantees and reality will have to be made in many places in the near future. It may be possible to provide one or two portfolios acquired in the recent past with additional strategy options as a result of this alone.

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