Services

David Landau & Associates, LLC (“DLA”) announces a significant rise in audits

David Landau & Associates, LLC (“DLA”) announced that it has increased its focus and staffing dedicated to auditing the use of construction, acquisition and operating budgets in response to increased demand from lenders and equity partners, particularly on projects initiated over the last three years. DLA currently has significant presence providing such services for REITs, REOCs, lending institutions and private equity firms, and is also responding to clients’ real estate restructuring pressures by focusing on the analyses usually required to successfully modify existing debt or pave the way for foreclosures on commercial real estate loans.

DLA offers a unique perspective with regard to debt and equity issues surrounding commercial real estate projects as it is one of the largest providers of Sarbanes-Oxley (SOX) and internal audit services to the REIT industry, in addition to its Forensic Accounting, Construction Audit and Asset Management services. David Landau, DLA’s President and CEO, remarked, “Our basic audit services for equity and mortgage REITs, banks and private equity investors often drive additional investigations relying on construction audits, cash controls, operational deficiencies, risk management and situations involving malfeasance. The severe downturn in real estate has forced lenders and investors to pay closer attention to where the money went.” Given current market conditions, many investors are now struggling with assets that require more active management than originally anticipated.

Rob Hellman, Managing Director of DLA’s real estate practice, adds, “Much of what we’re seeing today is a repeat of what we’ve seen in real estate capital markets within the last 20 years. The major difference today is that we saw a huge influx of new investors and developers into real estate post-2001. They were seduced by plentiful credit and have never lived through a down-cycle.” Speaking to the lack of controls in a market with so much available capital, he added, “It also means that there wasn’t a lot of pressure to watch costs or install proper controls because real estate had become such a liquid asset. I see it in my asset management activities for clients and I see it in the kind of engagements we’re being retained to do on the forensic side.”



Since most of DLA’s senior management came out of Big Four practices, the value-add component for clients is enormous. Phil Ramacca, formerly at E&Y and head of DLA’s internal audit practice, noted that “since all of our staff has considerable experience, we can spot issues for our clients early on and we can work with our clients to try to prevent serious damage. Unfortunately, we’re often brought in after the fact, but in those cases we’ve been very successful in establishing claims against partners or borrowers, enabling our clients to claw back or save significant amounts of money.”



In addition to its regular staff of audit and business optimization professionals, DLA has dedicated personnel conducting construction audits and several Certified Forensic Examiners. Additionally, DLA’s litigation support practice, led by Deloitte veteran, Paul Hammond, has seen a significant increase in litigation and support engagements. While these areas of DLA’s business have always been an important part of the company, real estate investors and lenders are increasingly recognizing the value and DLA has responded accordingly.

DLA (www.dlallc.com) has worked with over 100 SEC Companies and completed more than 500,000 hours of 404 advisory and internal audit services, including many REITs. Beyond the internal audit advisory capability, DLA services its real estate clients with asset management, forensic investigation and construction audit capabilities. DLA was founded in 2001 to fill the void of services that public accounting firms could no longer provide their clients as a result of independence issues. DLA utilizes a cross-functional approach derived from our business group expertise: Internal Audit, Forensic Accounting & Litigation Support and Business Advisory & Transactional Support, enabling DLA to field a multi-talented team that is able to take on a wide-range of real estate engagements.