New York Real Estate Lawyer Explains Commercial Real Estate law
Commercial real estate investing can be profitable and rewarding, but it can also be fraught with challenges.
From ensuring transactions go smoothly to addressing tax issues, to attending real estate closings, it’s imperative that investors get the right comemrcial real estate attorneys to protect large investments in real estate projects.
Daniel Kron can help. A New York commercial real estate lawyer at our firm can offer you comprehensive advice and represent your interests in all real estate transactions you enter into. You should give us a call early in the process so we can help you to protect your investment, negotiate favorable contracts, and make the legal system work to protect you.
We can also handle your real estate closing for you, making sure all the paperwork is in order and correctly filed so your transaction is completed properly. Call today to get an advocate on your side.
Purchase and Sales Agreements
Purchase and sale agreements are one of the key issues that a New York real estate lawyer can help you with. Purchase and sale agreements govern every commercial and residential transaction in which the ownership of the property changes hands. These agreements spell out every detail of the transaction, ranging from the purchase price to what is included with the sale to the timeline for the sale being completed.
While purchase and sale agreements all must contain specific details about how the transaction will take place, the terms, conditions, and clauses in the contract need to be negotiated for each transaction. Buyers and sellers both must ensure there are appropriate protective clauses included within purchase and sale agreements to protect their interests.
For example, buyers may want to ensure there are clauses in the contracts that allow the buyer to walk away without penalty if inspections reveal serious problems or that there are clauses in the contract to make it possible for the buyer to walk away from the transaction if the buyer is unable to secure financing.
Both buyers and sellers should be represented by a commercial real estate lawyer in New York who can help them to negotiate for the inclusion of clauses that provide them with important protections under the law.
Other terms of the contract need to be negotiated as well, including details on the cost of the purchase, the date of closing, and the bundle of rights that the seller will transfer to the buyer.
Daniel Kron has the negotiating skills to draft a purchase and sales agreement that is comprehensive, fair, and enforceable. Our legal team knows how to drive a hard bargain during negotiations so you can ensure the contract is as favorable as possible – without jeopardizing the deal. We also know how to effectively draft contracts with clear, enforceable language to reduce the risk that any part of the contract will be misinterpreted or found unenforceable if a problem arises.
Commercial Real Estate Closings
In the state of New York, an attorney oversees the real estate closing process. There are many technical steps involved in the process including:
- Running a title search: This needs to be done just before closing in order to make sure there are no new liens or assessments on the property. While buyers often request title searches well before closing to catch any possible issues early in the process, you don’t want to miss any last minute liens or encumbrances so doing a search very close to closing is essential.
- Preparing paperwork for changing the title and deed: An attorney will need to prepare this paperwork. The buyer will need to decide how to take title. The closing paperwork will also specify the date that the ownership transfer will take place and will provide details about the land being transferred to the new owners during the closing process.
- Determining the amount of money the buyer must bring to the table: The buyer must come to closing with a cashier’s check to cover all mortgage closing costs, property taxes and utilities paid by the seller to-date and any other costs necessary to conclude the sale.
- A final walkthrough: Typically, a walkthrough takes place on the day of the sale to verify that the property is in appropriate condition.
- Settlement: This process typically takes place at the real estate attorney’s office or a title office. The buyer will need to pay over the funds, and the attorney will record the transaction and deed with the municipality where the property is located.
- The buyer will take possession: The buyer is given the keys and becomes the new official owner of the property.
Many things could go wrong during the closing process, from problems during the title search to disputes over the final terms of the agreement to questions about how to structure ownership on the deed. Our real estate lawyers will be there to answer any questions you may have and to provide you with the insight and advice necessary to protect your interests.
Commercial leases, like purchase and sales agreements, are vitally important contracts to protect the interests of commercial real estate investors. Commercial leases govern the terms of rental agreements and establish the rights and obligations of both landlords and tenants.
Whether you are leasing your property or renting a commercial property, the terms of the commercial lease will have a major impact on whether the transaction is a profitable and positive one for you.
Because commercial leases can address so many key issues, anyone who is negotiating the terms of such a lease should be represented by a New York commercial real estate attorney throughout the process of drafting the lease. Both landlords and tenants should also ensure that an attorney reviews any final lease agreement before the contract is signed to provide insight into the rights and obligations that a lease imposes.
Commercial leases need to address basic issues, such as the duration of the lease, the rental cost, and who has the obligation to pay for repairs and to cover property tax and utility costs. Unlike in residential leases, which typically make landlords responsible for property taxes and repairs, these terms are up for negotiation in commercial leases and it is common for tenants to take on much more responsibility when it comes to maintaining the property and paying for expenses.
Commercial leases may also include many other clauses aimed at protecting the landlord and/or protecting the tenant. For example, lease agreements may specify the changes that tenants are permitted to make to the structure of the property. The agreements may also impose certain restrictions on landlords, limiting whether they can rent space in adjacent property to direct competitors of those who are currently leasing space.
Because many commercial tenants need to stay in their spaces for long periods of time, it is also common for commercial lease agreements to provide details on when a tenant has the right to renew a lease and what the terms of the renewal will be. Since the lease agreement can determine the terms of the relationship between the landlord and tenant for many, many years in the future, it is imperative that the lease agreement be sufficiently comprehensive and sufficiently fair to the interest of each party.
NY Litigation Firm can provide the necessary support and assistance to negotiate a commercial lease. We can provide representation to landlords or tenants and we will help with all phases of the process, from negotiating lease terms to drafting a lease agreement to taking appropriate action if conflict arises.
You should reach out to our legal team as soon as possible in the process of negotiating a commercial lease so you can get the assistance required to draft a contract that maximizes the chances the lease will fully protect your interests.
Commercial real estate owners need to ensure that their investment is a profitable one – which means they must take tax issues into account when entering into any real estate transaction.
Real estate owners must also ensure they are in full compliance with tax rules applicable to landlords, which were made even more complex as a result of 2017 tax reforms.
Daniel Kron can provide guidance on the tax issues that could affect your investment in commercial real estate. We can help you to understand rules related to depreciating buildings and can assist you with claiming all tax deductions and credits available to you. We can also provide you with advice on how best to structure your real estate investment company to pay the minimum in taxes and to gain the most flexibility in how your organization is taxed.
Our New York commercial real estate lawyers also have an understanding of a wide variety of other tax matters that can impact the owners of commercial real estate. We can assist with claiming tax credits for the development or improvement of low income housing properties, and can provide guidance on doing 1031 exchanges to defer taxes and invest in new properties.
Tax issues can be very complex, but the tax code contains many special carve-outs and clauses that can actually help commercial real estate owners to reduce their tax bills and increase their profitability. Let NY Litigation Firm help you to take full advantage of the tax rules that can benefit you as a real estate investor.
Joint Ownership and Shared Ownership
Because commercial real estate transactions often involve substantial amounts of money, it is common for those investing in real estate to do business with partners or other investors. When real estate is owned by multiple people or entities, this creates complexities associated with joint ownership.
A New York real estate lawyer can provide assistance with legal issues related to jointly owning property. We can help you to understand different methods of taking title, including joint tenants with rights of survivorship and tenants in common. These different methods of taking title can affect your rights both during the course of your lifetime and when any of the co-owners passes away.
If you are working with others, forming LLCs or incorporating your real estate business could also help to protect you from liability and from potentially being held personally financially responsible for losses that occur.
NY Litigation Firm will advise you on the best way to pool your resources with others to invest in property while getting the maximum in tax benefits and the maximum in legal protections.
Condominiums, Cooperatives, and Community Association Projects
While commercial real estate owners develop many different types of property, condominiums, cooperatives, and community association projects are very popular types of commercial real estate to invest in within the New York area.
When investing in these types of buildings in which ownership is shared among co-owners and in which developers maintain an interest and obligation, it is important to get the proper legal advice.
Building owners may retain responsibility for maintaining common areas, ensuring the building is in compliance with rules and regulations, and managing financial issues connected with the shared ownership.
Owners may also need to facilitate the creation or operation of condo or co-op boards who govern conduct, address conflict among tenants, collect fees, make repairs, and determine what improvements need to be made. The potential for conflict is high in these types of ownership arrangements and it is imperative that there are clear written bylaws or other contracts governing the rights and obligations of all co-owners and developers with an interest in the building.
A New York commercial real estate lawyer can help developers to understand and address the unique issues that arise when investing in condominiums, cooperatives, and community association projects. We have experience drafting enforceable, comprehensive bylaws and contracts and facilitating the effective operations of condo and co-op boards.
You should get an attorney involved as early as possible so a real estate lawyer in New York can help you to develop the processes and protocols necessary to reduce the risk of problems or conflicts arising.
Our firm can also help when issues do occur that must be resolved through mediation, arbitration, litigation, or other formal proceedings.
While many commercial real estate investors restrict their involvement in the real estate industry to purchases, sales, and leases, developers also build new properties as well. Construction raises many complex issues that must be addressed through detailed and comprehensive construction agreements.
Construction contracts need to be extremely comprehensive and detailed in order to ensure that a finished project meets the demands of the developer and end users.
Construction agreements should include detailed specifications regarding the materials and design of the finished structure. A timeline for completion must be included in a construction agreement and there should be clear policies in place regarding who is responsible for cost overruns or for unexpected expenses that arise during the construction project.
Construction agreements should also specify the timelines and conditions for periodic payments made during the construction project, and should address the issue of mechanics liens when timely payments are not made to contracts or to subcontractors. Agreements should also specify when and how disputes will be resolved.
Because each development project raises its own unique issues, it is imperative that all parties to a construction agreement be represented by an experienced attorney who can negotiate for the drafting of a contract that is fully protective of their interests.
An attorney can help developers, investors, and contractors throughout the construction process in negotiating and drafting a contract and responding when problems arise.
When properties are bought and sold, title examinations must occur. Title establishes ownership in a property, and no seller can transfer a greater degree of ownership to a buyer than the seller possesses. This means if a property has restrictions on the deed, if there are liens on the property, if there are easements, or if there are other limitations on a property owner’s use, those limitations and encumbrances transfer with the property.
Those who are purchasing any commercial property will need to ensure that the property comes with clean title and that they are acquiring the bundle of rights they need to use the property for its intended purpose. A detailed title examination is necessary and the purchase of title insurance is vital to protect the investment made by the property owner.
A New York commercial real estate attorney can provide assistance with title examinations and title issues.
Getting Help from a New York Real Estate Lawyer
No matter what your role is within the commercial real estate industry, NY Litigation Firm can advise you, protect your interests, and advocate for you.
Give us a call today to learn how we can help with contracts, building management and operation, real estate closings, title searches, purchase and sale transactions, leases, tax issues and more.