My partner and i read once that if you took all the real estate lawyers on Illinois and laid them end to end along the equator – it would be a good idea to leave them there. That’s what I study. What do you suppose that means?
I have written before regarding the need to exercise due diligence when purchasing commercial real estate. The requirement to investigate, before Closing, every significant aspect of the property you happen to be acquiring. The importance of evaluating each commercial real estate transaction using a mindset that once the Closing occurs, there is no going back. The owner has your money and is gone. If post-Closing problems come up, Seller’s contract representations and warranties will, at best, suggest expensive litigation. CAVEAT EMPTOR! “Let the buyer beware! inches
Paying extra attention at the beginning of a commercial real estate transaction to be able to “get it right” can save tens of thousands of dollars when the package goes bad. It’s like the old Fram® oil filtration slogan during the 1970’s: “You can pay me now : or pay me later”. In commercial real estate, nevertheless , “later” may be too late.
Buying commercial real estate is NOT just like buying a home. It is not. It is not. It is NOT.
In Illinois, and others states, virtually every residential real estate closing requires a lawyer for any buyer and a lawyer for the seller. This is probably smart. It truly is good consumer protection.
The “problem” this causes, nevertheless is that every lawyer handling residential real estate transactions takes into account himself or herself a “ Matterport Lyon real estate lawyer”, that can handle any real estate transaction that may arise.
We learned for law school that there are only two kinds of property: real estate investment and personal property. Therefore – we intuit – once we are competent to handle a residential real estate closing, we should be competent to handle a commercial real estate closing. They are each and every “real estate”, right?
ANSWER: Yes, they are each properties. No, they are not the same.
The legal issues and risks inside a commercial real estate transaction are remarkably different from the legal issues and risks in a residential real estate transaction. Most are not remotely similar. Attorneys concentrating their practice handling domestic real estate closings do not face the same issues as law firms concentrating their practice in commercial real estate.
It is a few experience. You either know the issues and risks built in in commercial real estate transactions – and know how to handle them – or you don’t.
A key point to remember is that the multitude consumer protection laws that protect residential home customers have no application to – and provide no protection regarding – buyers of commercial real estate.
Competent commercial real estate training requires focused and concentrated investigation of all issues substance to the transaction by someone who knows what they are looking for. To put it briefly, it requires the exercise of “due diligence”.
I confess – the exercise of due diligence is not cheap, nevertheless the failure to exercise due diligence can create a financial disaster with the commercial real estate investor. Don’t be “penny wise and pound foolish”.
If you are buying a home, hire an attorney who regularly symbolizes home buyers. If you are buying commercial real estate, hire legal counsel who regularly represents commercial real estate buyers.
Years ago I just stopped handling residential real estate transactions. As an active business real estate attorney, even I hire residential real estate recommend for my own home purchases. I do that because personal real estate practice is fundamentally different from commercial real estate.
Possibly I do “harp” on the need for competent counsel experienced in commercial real estate transactions. I genuinely believe it. I think it is essential. I believe if you are going to invest in commercial real estate, you must utilize your critical thinking skills and be smart.