Common Documentation Mistakes with Commercial Real Estate Acquisition
Apr 27 2022 0

Common Documentation Mistakes with Commercial Real Estate Acquisition

The decision to purchase commercial real estate is nothing to be taken lightly and should be a strategic determination that will ultimately benefit your business intentions and increase your bottom line. Business owners in California that are thinking about buying a commercial listing must consider many things including taxes, projected profits, overhead, and more. There are many legal documents that are involved with the execution of a commercial property purchase. With each of these documents, there is always the potential that problems may come up and issues could arise that can derail a business owner’s plans for the future.

For more support and legal guidance when it comes to commercial real estate acquisition in California, the Los Angeles real estate acquisition attorneys at Leiva Law can help.

What Real Estate Acquisition Documents Could Be Problematic?

The process of determining what type of property and location best meets the specific needs of a business to finding that location and then ultimately procuring it takes patience and effort. Once a property is in the process of being purchased the amount of paperwork that must be scrutinized and completed is quite a task.

Commercial property acquisition documentation includes:

Letter of Intent

Common Documentation Mistakes with Commercial Real Estate Acquisition

An initial document where all of the terms of the real estate purchase are detailed is the letter of intent. This is not a binding agreement or sales contract, but rather a document that informs the prospective buyer about the purchase before the buyer commits to acquiring a property. If the wording is not written properly, this could change the function of the document to be more binding.

Brokerage Agreement

The brokerage agreement is a legally binding document that will outline the broker’s duties to the buyer. A buyer can experience significant difficulties with a property purchase if a bad agreement is signed.

Sales and Purchase Agreement

When a timeline must be met, the sale and purchase agreement (SPA) must be done correctly or deadlines may not be completed on time. As a result of issues with a SPA, additional unexpected costs could be accrued.

Environmental Impact Assessment

Commercial property development can come with negative ramifications on many aspects of the social and natural environment where it is to be located. This environmental assessment could make or break a deal.

Tenancy Agreement

Should the property you choose already have tenants, this must be considered and managed appropriately before you can become the new landlord.

It is important for businesses to have each step of the commercial property acquisition process go smoothly, including all of the documentation and assessments. In-depth research and analysis of potential properties should be done in preparation for buying a commercial property.

For any questions or for legal support when you are searching for an appropriate commercial property in Los Angeles, please connect with the Los Angeles business attorneys at Leiva Law.

Speak with a Los Angeles Commercial Real Estate Acquisition Attorney Today

A qualified California business litigation attorney is invaluable when it comes to closing a commercial real estate transaction in the most favorable and least costly way. The legal team at Leiva Law is skilled at negotiations, documentation, and efficient closings and can be there for you through every step of the process. 

To learn more about California commercial real estate acquisition, please call Leiva Law today to schedule a free consultation with an experienced attorney at (818) 519-4465.

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