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Commercial Real Estate Due Diligence

Posted January 21, 2016

Purchasing commercial real estate is an investment. Like any other investment you should perform appropriate due diligence to avoid costly mistakes.


Negotiation is the key to a good contract.  Having this expectation from the beginning can save a lot of time and headache when dealing with the seller especially if they aren’t willing to provide what you request, it could indicate that you don’t want to continue the deal.

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Since commercial real estate is very different than residential real estate, it is important to understand how it is valued, any restrictions on its use and whether its income stream is reliable.  Involve an attorney early on to make sure you obtain the appropriate documents with sufficient time to review them and retain adequate rights to cancel depending on what the documents reveal.  Some documents that may be important include leases, addendums, options, certificates of occupancy, and prior zoning resolutions of approval and so on.  There might be a lease clause that is a deal breaker for you or someone may have been denied a variance that you would need to use the property productively.   If the deal is not going to work, it is best to figure that out before it is too late.


Having a solid acquisition team is essential to getting the benefit of your bargain in commercial real estate. Being able to assign due diligence tasks to experts prevents missteps and can make your purchase smoother and more profitable. Contact the attorneys at Foss, San Filippo & Milne, LLC for assistance with your commercial property acquisition. Fill out our online contact form or call 732-741-2525.