Certainly! In my experience, a typical commercial real estate transaction involves several key steps. First, the parties enter into a letter of intent (LOI), which outlines the basic terms of the transaction, such as the purchase price, earnest money deposit, and due diligence period. The LOI is typically non-binding and serves as a foundation for negotiating the final, binding purchase agreement.
Next, the parties negotiate and execute a purchase agreement, which is a legally binding contract that sets forth the specific terms and conditions of the transaction. This document will cover issues such as representations and warranties, indemnification, and closing conditions.
During the due diligence period, the buyer conducts a thorough investigation of the property, including reviewing title, survey, and environmental reports, as well as any leases and other contracts affecting the property. This is a crucial step, as it allows the buyer to identify any potential issues or risks associated with the property.
Once the due diligence period expires and the buyer is satisfied with the property's condition, the parties proceed to closing. At closing, the seller delivers a deed to the buyer, transferring title to the property. The buyer will also typically deliver the purchase price to the seller, either through a wire transfer or a cashier's check. Finally, the parties will execute and exchange various closing documents, such as closing statements, affidavits, and tax forms.
Next, the parties negotiate and execute a purchase agreement, which is a legally binding contract that sets forth the specific terms and conditions of the transaction. This document will cover issues such as representations and warranties, indemnification, and closing conditions.
During the due diligence period, the buyer conducts a thorough investigation of the property, including reviewing title, survey, and environmental reports, as well as any leases and other contracts affecting the property. This is a crucial step, as it allows the buyer to identify any potential issues or risks associated with the property.
Once the due diligence period expires and the buyer is satisfied with the property's condition, the parties proceed to closing. At closing, the seller delivers a deed to the buyer, transferring title to the property. The buyer will also typically deliver the purchase price to the seller, either through a wire transfer or a cashier's check. Finally, the parties will execute and exchange various closing documents, such as closing statements, affidavits, and tax forms.