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7 Practical Steps to Expedite the Sale of Commercial Real Estate
Owners selling commercial real estate should consider these seven practical steps to expedite the due diligence period, decrease the negotiated reductions in sales prices, and speed up the eventual closing.
Property Information. Collect and organize all available property information to provide to potential buyers as early as possible. Gather and organize property information prior to placing the property on the market. Your ability to promptly deliver well organized due diligence materials will shorten the buyer’s due diligence period. Information to collect includes: financial information (rent rolls, operating statements, tax bills and other expense information), leases, environmental reports, soil reports, physical inspection reports, termite reports, surveys, plans, permits and warranties.
Title and Survey. Obtain a survey and title commitment to shorten buyer’s due diligence period. Obtaining and delivering a current title report, together with a copy of the underlying documents, from a financially sound title company may enable...[read more]
Angel Law Offices - Commercial Real Estate Lawyers - Los Angeles | Denver | Boulder
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Due Diligence for Commercial Real Estate: A Checklist for Seller’s Documents
The information a buyer gathers and evaluates during the due diligence period will vary depending upon many factors, including the size of the transaction and due diligence budget, property type (office, retail, industrial, multi-family, land, etc.), occupancy (vacant, single tenant or multi-tenant), prior uses of the property, etc. Depending upon the property involved, there are items in this due diligence checklist that may not be appropriate and other items not listed that a buyer may want to include.
Buyers of commercial real estate often ask sellers to insert in the purchase agreement a list of due diligence documents to be delivered by the seller. If information in the buyer’s document list is not readily available to the seller, the document list may be narrowed down by the seller during negotiations. This process, in itself, may provide the buyer with insight into unquantifiable risks or costs that will be incurred to obtain the necessary information.
There are many elements of the due diligence process for commercial real estate, including obtaining new third-party inspection reports and a title report. This due diligence checklist focuses on information that buyers attempt to obtain from sellers. Whatever information is ultimately provided, sellers generally include a provision in the purchase agreement stating that the information contained in documents and third-party reports must be verified by the buyer and shall not constitute a representation or warranty of the seller as to their accuracy. [CLICK TO VIEW CHECKLIST]
Angel Law Offices - Commercial Real Estate Lawyers - Los Angeles | Denver | Boulder
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