The commercial real estate market is in crisis and the bottom line is a window of opportunity for investors to acquire properties at deep discounts. Even in today's turbulent market, commercial real estate can provide investors with opportunities to obtain higher yields and potential appreciation. However, along with opportunity comes increased risk. Therefore, it is more important than ever for real estate investors to enlist an experienced team that will reduce the threat of risk. During the initial step of selecting a real estate brokerage firm to assist in identifying potential acquisitions, the investor should reach an agreement in writing as to exactly how the firm is compensated. Terms would include fees for selection of property, broker commission for tenants, and management services. An experienced real estate lawyer can advise during this step, as well as handle contract negotiations with the seller later in the process. Once acquisitions are identified, an offering brochure should be obtained from the seller's broker that includes-along with the purchase price-information about the physical description of the property, capital improvement programs, property information, historical and budgeted operations, prospective cash flows and net operating income, and tenant background and leases. When reviewing this information, take the current economy into consideration. In down economies, vacancy rates tend to be higher than normal and the financial condition of the tenants may have weakened. Also, rental rates have been declining, which typically affects the real estate cap rates and real estate value. Since good deals usually go fast, it is important that the financing be obtained through a dedicated real estate financing firm, which can process the financing faster than a general financing firm. Fees charged by the real estate financing firm should fall between .75% and 1% of the loan. The contract should provide for a due diligence period after the signing, during which the buyer must inspect, examine and investigate all aspects of the property. If the buyer determines that the premises are not acceptable, he/she should have the right to terminate the agreement by written notice to the seller at any time prior to the expiration of the diligence period. The following due diligence steps should be carefully carried out to reduce risk: * Evaluate current marketing reports affecting the region and county where the property is situated; *Obtain an engineering report, environmental phase 1 report and an appraisal of the property by firms acceptable to the lender; *Secure a title search and updated survey; *Obtain certificates of occupancy of all tenants and estoppel certificates for at least 75% of tenants; *Review all tenant leases and service contracts, and *Inquire about commissions due. It is essential to verify the income and expenses for the property, both historical and prospective, by examining underlying documentation. As an accounting firm that specializes in real estate, we are often asked to perform these functions. CPA firms also typically can provide referrals for real estate firms and lawyers with good reputations in this sector. In conclusion, to reduce risk the savvy real estate investor should assemble an experienced team consisting of a real estate firm, attorney, and CPA. These professionals should be vigilant throughout the process: questioning inconsistencies, demanding full documentation, and conducting complete analysis. Robert Vallone is a CPA and partner with Eisner & Lubin LLP, New York, N.Y.