Commercial real estate transactions are more complicated than residential deals and usually involve much higher stakes and risks. While there may be an inclination to keep a deal “short and simple,” a well-drafted contract, overseen by professionals who understand the process and all of the legal aspects involved, is absolutely essential!
There are no set “rules” in a commercial real estate contract. Every term, every word, is up for negotiation. Whether you are represented as the seller or the buyer, the time and money spent to create a thorough and complete contract is well worth the effort in reaching the fairest deal possible. If any steps are missed during the due diligence, negotiation, and contract processes, the outcome could turn into a financial disaster.
Remember- for your own protection everything must be in writing! Don’t ever accept someone’s word on any of the terms and conditions. Legal representation is imperative to ensure the contractual document is clear and concise. Vague references, confusing language, omissions, or lack of clarity on certain provisions will ultimately lead to issues down the road. Clear, concise, specific wording will avoid misunderstandings that can result in financial losses or unexpected obligations.
There are a number of issues to consider before entering into a commercial real estate deal. All provisions within the contract must be reviewed carefully, as this is where the unfavorable factors often lie hidden. Some of the top items that need to be addressed and clearly defined in a contract include:
- Survey issues
- Title concerns
- Zoning restrictions
- Land use approvals
- Property income and expenses
- Building conditions and maintenance issues
- Tenants and their leases
- Property-related contracts including management and insurance
- Environmental concerns
- Intellectual property and warranties
We understand that each real estate deal is unique and rightfully demands a high level of scrutiny and attention to detail. Our firm has the expertise to successfully navigate through the variety of challenges and opportunities presented in a commercial real estate contract. No issue is too small to consider.
Even if a prospective property and business opportunity initially looks like a good deal, it is a bad idea to rush into a contract before carefully examining all of the complexities. If you are entering into a commercial real estate transaction, get in touch with our firm right away. When you work with us, we will counsel you to make informed and conscious decisions. We will also help you avoid creating significant and long-lasting detrimental obligations. With our legal representation and guidance, you will be protected and have a definite advantage when negotiating. Your interests and financial well-being are important to us.