Practicing Due Diligence When Purchasing Commercial Real Estate

 Posted on December 00, 0000 in Commercial Real Estate

Commercial real estate purchases might offer the buyer several opportunities, such as an expansion of their portfolio or an increase in income, but they are also a major investment. This is why due diligence is so critical in commercial real estate transactions. Know your rights, understand the importance of an experienced commercial real estate attorney, and learn how to ensure you have considered all aspects of a potential acquisition through proper and effective due diligence practices.

Your Due Diligence Rights

Under Illinois state law, buyers are permitted a due diligence period (generally 45 to 60 days) once a contract is signed. This time should be used to ensure that the property, and its intended use, will be able to meet all local, state, and federal zoning regulations. If you happen to find a major issue, you can still back out of the deal at this time. However, failure to practice due diligence – or ineffective due diligence practices – could leave you at risk for a substantial financial loss. In some situations, it could even result in the purchase of a property that is useless to you.

Practicing Due Diligence

When you are investigating a property, there are numerous aspects and factors to consider. You will want to know all present and past uses of the property, as well as any present or past tenants, subtenants, and owners. If the property was ever demolished, remodeled, or otherwise altered, you will need to know the dates of when this happened, and what the property was being used for before and after the alteration. Furthermore, you will need to determine if there are any environmental issues, zoning restrictions, and past zoning problems.

How An Experienced Commercial Real Estate Attorney Can Help

Due diligence factors are numerous and often highly complex. To ensure you have covered everything, and to avoid costly mistakes or oversights, it is highly recommended that you seek the skilled help of an experienced commercial real estate attorney. Able to serve as an advocate for your best interest, they can fully investigate all relevant factors in your commercial real estate transactions and advise you of the potential issues you may face, should you complete the purchase.

With more than 10 years of experience and a vast portfolio of successful transactions, Lindell & Tessitore, P.C. offers the high-quality legal representation you need. Dedicated to protecting your financial future, we help ensure your investment is a sound one. To learn more, contact our Naperville commercial real estate lawyers today. Call 630-288-2555.

Sources:

http://www.wvcommerce.org/App_Media/assets/doc/peopleandplaces/OnTrac/Checklist_for_property.pdf

http://www.ilga.gov/legislation/ilcs/ilcs5.asp?ActID=2301&ChapterID=0