When you decide to purchase a piece of commercial real estate, there are many considerations. Profit margins, projections and tax liabilities all are part of it, but the nuts and bolts of the purchase include a dizzying array of documents. Mistakes in these documents can throw your entire strategy out the window.
A quick overview of the potential issues with sale documents
While legal documents are often reviewed and researched extensively, they are still crafted by people. That means you can have problems with the documents, such as:
- Brokerage agreements: While you may not necessarily have a broker if you do and the agreement you have with them is faulty, it can impact your sale.
- Letter of intent: Improper wording in the letter of intent can change it from “an intention” to an agreement.
- Purchase and sale agreements: Potentially the most important part of the sale and easily the most scrutinized. Errors here lead to costly delays.
- Environmental impact assessments: Your team will need to conduct extensive research on the property if you’re expecting to renovate. A motivated party will use any oversight to vastly delay your project.
- Tenancy agreements: Most commercial properties have tenants already, and you’ll have to review their agreements and draft documentation to take over as their landlord.
These are just a few of the documents you will work with during the sale process, and you’ll review them all at various times. You must never lose sight of the fact that these documents are extremely complicated.
Getting help before it’s too late
At any point in the commercial real estate process, you can look into getting your documents reviewed by a second set of eyes. A second legal opinion can often find mistakes that your original attorneys and representation were too close to see.