With Commercial Real Estate, Is It Enough To Rely On A Property Broker Or Realtor To Get Through A Transaction Or Should You Include An Attorney In The Process?
Generally speaking, the participants in a deal are the buyer, the seller and the lender. All three of those parties are going to have an attorney. So normally in commercial real estate, you’re almost always going to want to have an attorney.
A broker is going to bring a lot of experience and a lot of insight and information to you but usually, there is a legal component that’s added to that as well. Especially in commercial deals, every deal is handled uniquely. That means residential is very much a “forms based” deal. Residential mortgages are all regulated for the most part by Fannie Mae, Freddie Mac, VA, FHA and are fairly uniform. Though estate laws vary state to state, the underlying principles and the underlying documentations are very standard. They might all look different but to a large extent in residential, it’s all the same. Whereas in commercial real estate, every bank has the right to use their own documents and every contract that’s written could be written differently.
In commercial deals, you could theoretically be negotiating the various terms of a contract, every paragraph and every word. The real estate associations and the Board of Realtors, national and local, have come up with their form documents, much like the national and local mortgage companies have for residential. This makes things very uniform to the extent that it cuts down on transaction costs in residential. As a result, when you’re buying or selling your house, you’re not spending thousands of dollars retaining attorneys to review the documents.
In the commercial, that is what happens. You retain attorneys and it can take months to negotiate. You have long due diligence periods while you go through everything and because there are many more moving pieces, it is always advised have an attorney on your side in some respect. That’s necessary because the broker is going represent you from a seller’s standpoint but they can’t give you legal advice and they can’t give you necessary tax advice, especially in the commercial world. There are a lot of other considerations that go into it.
If you want to Contact An Attorney For Commercial Real Estate, call the law office of Attorney Brian Douglas for an initial consultation at (770) 933-9009 and get the information and legal answers you’re seeking.