Land & Project Acquisition

2. Acquisition of a project company

Instead of acquiring the property, the buyer acquires shares or quotas in the company that owns the property.

This may preserve project contracts and operational continuity, but it also means that the buyer acquires a company with its history, liabilities, contractual obligations and potential undisclosed exposures.

• A share acquisition therefore requires corporate, accounting, tax, employment, litigation and contractual due diligence in addition to the full property and planning review.

3. Acquisition of project rights

A buyer may acquire a package of contractual and project rights, such as:

• architectural and engineering designs;
• consultant appointments;
• planning applications;
• information requests or planning decisions;
• construction contracts;
• operator or management agreements;
• marketing materials;
• pre-sales arrangements;
• warranties;
• surveys and reports;
• and rights under existing development agreements.

Not every project document, contract, licence or administrative position is automatically transferable. Assignment restrictions, third-party consents, intellectual-property ownership and administrative requirements must be checked individually.

4. Conditional acquisition

The buyer agrees to acquire the property only if defined conditions are satisfied.

Typical conditions may concern:

• satisfactory legal, planning and technical due diligence;
• confirmation of the development capacity;
• obtaining a favourable planning decision;
• rectification of boundaries or registered areas;
• cancellation of mortgages or attachments;
• delivery of the property free from occupants;
• non-exercise of applicable pre-emption rights;
• financing approval;
• corporate approvals;
• or delivery of specified project documents.

The condition must be objectively drafted. The contract should identify who is responsible for satisfying it, the evidence required, the deadline, any right of waiver and what happens if the condition is not satisfied.

5. Option to acquire

An option can give the investor the right, but not the obligation, to acquire the property within an agreed period and under defined conditions.

An option may be useful when the investor needs time to:

• investigate development potential;
• obtain a planning decision;
• assemble adjoining plots;
• arrange financing;
• secure an operator;
• or complete commercial negotiations.

The option document must define the asset, price or pricing formula, option period, exercise mechanism, exclusivity, access rights, option fee and consequences of expiry.

6. Landowner joint venture

Instead of selling the property immediately, the landowner may contribute land or grant development rights to a joint project.

The developer may contribute:

• capital;
• project management;
• design and licensing work;
• financing arrangements;
• construction management;
• and sales or operational expertise.

The agreement must address control, funding, decision-making, land valuation, security, cost overruns, distributions, deadlock, default, dilution and exit. A joint venture does not eliminate acquisition risk. It changes how that risk is shared and governed.

Share purchase

The buyer acquires:

• The company that owns the property.
• Main advantage: operational and contractual continuity may be preserved.
• Main risk: historical and undisclosed company liabilities.

Conditional purchase

The buyer acquires:

• The property after defined conditions are satisfied.
• Main advantage: limits exposure to identified development risks.
• Main risk: conditions may be disputed if drafted subjectively.

Option

The buyer acquires:

• A right to acquire during an agreed period.
• Main advantage: allows investigation before committing to purchase.
• Main risk: protection depends on enforceability, duration and contractual structure.

Landowner joint venture

The buyer acquires:

• Contractual or corporate participation in the project.
• Main advantage: reduces the immediate land acquisition cost.
• Main risk: governance, funding and exit disputes.

Project-rights acquisition

The buyer acquires:

• Designs, applications, contracts and other project assets.
• Main advantage: may accelerate an existing project.
• Main risk: rights and approvals may be incomplete or non-transferable.

The proposed structure

State whether the transaction is intended to be:

• an asset purchase;
• a share purchase;
• a project-rights purchase;
• an option;
• a promissory purchase agreement;
• a joint venture;
• or another conditional arrangement.

The structure should remain subject to legal and tax confirmation until the relevant due diligence has been completed.

The price assumptions

Clarify whether the price is:

• fixed;
• calculated by registered area;
• calculated by verified site area;
• linked to permitted construction area;
• adjusted by planning outcome;
• subject to completion accounts;
• partly deferred;
• or supplemented by an overage or earn-out.

Terms such as “construction area”, “gross floor area”, “saleable area” and “approved area” must be defined. Different documents and professionals may use these expressions differently.

The due diligence period

The buyer should have sufficient time and access to:

• inspect the property;
• review the complete data room;
• commission surveys;
• meet the project team;
• verify planning information;
• and raise follow-up questions.

The timetable should begin only when the agreed minimum information has been delivered.

Exclusivity

Exclusivity should define:

• its duration;
• the properties and transaction covered;
• prohibited seller conduct;
• whether existing negotiations must be disclosed or terminated;
• the seller’s duty to cooperate;
• permitted communications;
• extensions;
• and remedies for breach.

A short exclusivity period with an incomplete data room may provide little real protection.

Binding and non-binding provisions

A letter of intent or heads of terms may be described as non-binding while containing binding provisions on:

• confidentiality;
• exclusivity;
• access;
• costs;
• governing law;
• dispute resolution;
• announcements;
• and return or destruction of information.

The legal effect depends on the wording and circumstances, not only on the title of the document.

2. Boundaries, area and cadastral consistency

Compare:

• the land registry;
• the tax register;
• cadastral information;
• topographical surveys;
• municipal plans;
• existing project drawings;
• and the physical occupation of the site.

A price linked to area should state which measurement controls and what happens if the verified area differs from the stated area.

3. Access and infrastructure

Confirm legally enforceable access to a public road and the practical availability of:

• water;
• sewage;
• electricity;
• telecommunications;
• drainage;
• waste services;
• and any infrastructure required by the intended project.

Physical access does not necessarily establish a legal right of access. The acquisition documents should address any easements, infrastructure agreements, municipal works or off-site improvements required for the project.

4. Planning and licensing

Review:

• applicable territorial plans;
• land classification and qualification;
• planning constraints;
• information requests and responses;
• approved designs;
• licences;
• prior communications;
• conditions imposed by authorities;
• use documentation;
• infrastructure obligations;
• fees;
• expiry dates;
• pending amendments;
• administrative proceedings;
• and correspondence with the municipality and other authorities.

Never price an acquisition solely on the seller’s statement that a project is “approved”.

5. Physical and technical condition

Depending on the asset, commission appropriate investigations covering:

• topography;
• geotechnical conditions;
• structural condition;
• contamination;
• asbestos or hazardous materials;
• utilities;
• flood and fire exposure;
• demolition;
• archaeology;
• trees and protected habitats;
• existing buildings;
• construction defects;
• and incomplete works.

The contractual remedy should reflect the risk. A report identifying a problem does not itself protect the buyer.

6. Occupation and third-party rights

Identify all persons using or occupying the property, including:

• tenants;
• licensees;
• operators;
• caretakers;
• contractors;
• neighbouring owners;
• agricultural users;
• and informal occupants.

If vacant possession is required, define what “vacant” means, who must deliver it and the evidence required at completion.

7. Existing project contracts

Review all material contracts, including:

• architectural and engineering appointments;
• planning consultancy agreements;
• contractor appointments;
• project-management agreements;
• operator or franchise agreements;
• brokerage and marketing agreements;
• pre-sales;
• reservation agreements;
• utility agreements;
• insurance;
• financing documents;
• and litigation settlements.

8. Intellectual property and project information

Ownership of the land does not automatically give the buyer unrestricted rights to use, alter or reproduce every design prepared for the project.

Confirm rights to:

• architectural drawings;
• engineering designs;
• BIM and digital files;
• surveys;
• renders;
• branding;
• marketing materials;
• specifications;
• reports;
• and databases.

The buyer should receive the editable source files and not only PDF copies where continued project development requires them.

9. Tax position

For an asset acquisition, review:

• Property Transfer Tax, known as IMT;
• Stamp Duty;
• any applicable VAT treatment;
• annual property taxation;
• tax values;
• exemptions or benefits;
• municipal charges;
• and the tax consequences of the intended ownership and development structure.

Tax analysis should be completed before the transaction structure becomes binding. See the Portuguese Tax Authority’s IMT Code — Article 2.

10. Corporate due diligence in a share acquisition

When acquiring a property-owning company, review:

• commercial registration;
• articles of association;
• shareholders or quota holders;
• beneficial ownership;
• corporate approvals;
• annual accounts;
• management accounts;
• tax returns;
• financing;
• shareholder loans;
• guarantees;
• employment;
• social-security compliance;
• litigation;
• insurance;
• related-party transactions;
• distributions;
• contracts;
• data protection;
• and regulatory compliance.

A permanent commercial certificate gives access to current registered information and pending commercial registration requests. The RCBE identifies the natural persons declared as ultimately controlling the entity, but RCBE information does not itself constitute proof of the entity’s legal status.

Exclusivity agreement

Exclusivity prevents specified negotiations or transactions during an agreed period. It does not necessarily oblige the buyer to acquire the property or the seller to complete the sale.

It should provide enough time and cooperation for the proposed investigation.

Option agreement

An option may give the buyer a unilateral right to proceed with the acquisition during a defined period.

The exercise procedure must be unambiguous. The agreement should also address registration or other protective measures where appropriate and legally available.

Promissory purchase and sale agreement

A Portuguese promissory agreement, commonly referred to as a CPCV, creates an obligation to enter into the future definitive contract on the agreed terms.

It should not be treated as a simple reservation document. Portuguese law imposes form requirements on promissory agreements, with additional requirements potentially applying to promises concerning buildings or urban units. The form and execution method should be confirmed for the specific transaction. The agreement should address:

• exact identification of the parties and property;
• purchase price;
• payments;
• conditions precedent;
• completion date or mechanism;
• long-stop date;
• seller cooperation;
• access;
• title and encumbrances;
• possession;
• public and private pre-emption rights;
• project documents;
• representations;
• allocation of taxes and costs;
• assignment;
• default;
• contractual remedies;
• specific performance;
• termination;
• and dispute resolution.

Under the Portuguese Civil Code, amounts paid by a promissory purchaser to the promissory seller are generally presumed to constitute a deposit or “sinal”. Depending on the circumstances, contractual wording and party responsible for non-performance, the statutory consequences can include loss of the amount paid or a claim for double its amount. The deposit, default and remedy provisions must therefore be deliberately drafted. Do not assume that a payment is refundable merely because the transaction has not completed. See the Portuguese Civil Code, including Articles 410 to 413 and 440 to 442.

Planning outcome

A favourable planning decision meeting objectively defined parameters, such as use, gross construction area, number of units, height, parking, access and infrastructure obligations.

Avoid vague conditions based only on obtaining “approval”. An approval materially different from the investment case may have little commercial value.

Area and boundaries

Confirmation of minimum site area, agreed boundaries and absence of material overlaps or occupations.

Release of security

Cancellation of mortgages, attachments or other charges at or before completion, using a coordinated release and payment mechanism.

Vacant possession

Delivery of the property without occupants, leases, licences, materials or equipment not accepted by the buyer.

Pre-emption rights

Evidence that applicable statutory or contractual pre-emption procedures have been completed without the right being exercised.

Public pre-emption rights can apply, for example, to certain classified properties and properties in protected areas or urban rehabilitation areas. The specific property and transaction must be checked. See the official Casa Pronta pre-emption service.

Project documents and consents

Delivery or valid transfer of agreed designs, reports, contracts, warranties and intellectual-property rights, together with any required third-party consents.

Financing

Where completion depends on financing, the contract should specify whether financing is a condition, how it is evidenced and whether the buyer must use reasonable efforts to obtain it.

Sellers may resist a broad financing condition. This risk should be negotiated expressly and not left to assumption.

Area-based adjustment

The price is adjusted by reference to verified land area, approved construction area or another defined measurement. The agreement must specify:

• the measurement standard;
• the responsible surveyor;
• the controlling document;
• permitted tolerance;
• dispute procedure;
• and any minimum or maximum adjustment.

Planning-linked price

Part of the price depends on the planning outcome.

The formula should define the relevant approval, area, use, date and calculation method. It should also address later amendments, phased approvals and appeals.

Deferred consideration

Part of the price is paid after completion.

The documents should address:

• payment dates;
• conditions;
• interest;
• security;
• set-off;
• subordination to lenders;
• and dispute mechanisms.

Overage or earn-out

The seller may receive an additional payment if the project later achieves an agreed planning, construction, sales or operational outcome.

Long-term overage provisions require precise definitions, reporting obligations, audit rights, security and clear rules governing changes to the project.

Share-deal price adjustments

A share acquisition may use:

• a fixed or locked-box price;
• completion accounts;
• adjustments for cash, debt and working capital;
• or specific deductions for identified liabilities.

The property value and the equity purchase price are not necessarily the same figure.

Between signing and completion

The agreement may regulate:

• maintenance of the property;
• new leases or contracts;
• project amendments;
• financing;
• distributions;
• litigation settlements;
• communication with authorities;
• access by the buyer;
• insurance;
• and preservation of project information.

In a share acquisition, these interim controls are especially important because the value and liabilities of the target company may change before completion.

At completion of an asset acquisition

The parties should confirm:

• execution of the legally required transfer instrument;
• payment of the applicable taxes;
• payment of the balance of the price;
• cancellation or controlled discharge of security;
• delivery of possession;
• delivery of original and digital project records;
• satisfaction of pre-emption procedures;
• and submission of the acquisition and related security for registration.

Portuguese property transactions may be completed through a public deed, an authenticated private document or an integrated registration service such as Casa Pronta, depending on the transaction and chosen procedure. An authenticated private document used for property registration must comply with the applicable authentication and electronic-deposit requirements. See the Justice portal guidance on authenticated private documents.

At completion of a share acquisition

The parties should address:

• transfer instruments;
• corporate approvals;
• resignations and appointments;
• company books;
• commercial registrations;
• bank mandates;
• shareholder loans;
• releases;
• beneficial-ownership information;
• original records;
• and control of the company’s accounts, systems and documents.

After completion

Post-completion actions may include:

• definitive property or commercial registrations;
• beneficial-ownership updates;
• tax reporting;
• municipal notifications;
• insurance updates;
• utility transfers;
• contractor or consultant novations;
• finance drawdown requirements;
• and implementation of the next planning and design phase.

Property acquisition is subject to mandatory registration. The registration publicises the new ownership and protects the parties’ legal position. See the IRN guidance on definitive acquisition registration.

Step 2 — Preliminary structure and offer

Select the provisional transaction structure and issue a carefully qualified offer or heads of terms.

Step 3 — Exclusivity and data room

Secure an appropriate investigation period and obtain the agreed documentation.

Step 4 — Due diligence

Complete the legal, planning, technical, environmental, tax, financial and commercial review.

Step 5 — Risk allocation

Decide which risks must be resolved, priced, insured, secured or accepted.

Step 6 — Transaction documents

Negotiate the option, CPCV, sale and purchase agreement, joint-venture agreement or other definitive documentation.

Step 7 — Conditions precedent

Obtain the required planning decisions, consents, releases, financing and other evidence.

Step 8 — Completion

Execute the required documents, pay the applicable amounts, transfer control or possession and submit the necessary registrations.

Step 9 — Post-completion implementation

Complete the outstanding registrations, transfer project information and move into planning, design or construction.