It’s imperative that you take a little time to save a lot of time. This is why establishing a detailed transaction plan is so important. Your plan should outline your objectives and what it will take to achieve them. It will guide you through all contract negotiations, including the steps needed to move through closing and into post-closing.
What else will this plan include? Think details such as zoning requirements, the building’s structural elements, and environmental regulations that may affect the transaction. And these are just some of the many factors you will want to feature in your plan.
While your transaction plan doesn’t have to be complex per se, it should definitely be thorough. It must also highlight the time required to get to closing, with some flexibility factored in for any challenges that may come up. This brings us to the next step in the process.
You can expect a few hurdles as you approach the closing of your commercial real estate transaction. As such, you’ll need to expect the unexpected—and be prepared for any curveballs that might pop up.
The idea here is that anticipating issues before they become a problem can help you close your deal faster. It’s also important to note that many issues can later turn into opportunities. Risk-shifting methods are vital here. These may include title insurance with the relevant commercial endorsements, with help from a skilled lawyer and an expert title underwriter.
By being aware of each and every problem that may set you off course, and by engaging in multiple negotiation sessions with the relevant parties when necessary, you can mitigate potential problems and move swiftly through closing.
On paper, commercial real estate transactions involve a buyer and a seller. In reality, these transactions are far more complicated! From public agencies to vendors, there can and will be other parties involved in the process—and these entities may experience delays that will set your timeline off-course.
It’s key to remember that while you might have a deadline in mind, these third-party people and organizations do not (at least not necessarily). Your transaction is likely one of many these entities must navigate, and chances are they simply aren’t under the same level of pressure.
Fortunately, a seasoned commercial real estate attorney can navigate delays and leverage their network to push for a quicker response. Title companies’ in-house attorneys have generally developed close relationships with these third parties, and they can expedite the commercial transaction when necessary.
The end of a commercial real estate closing can be anxiety-inducing. From relying on independent third parties to providing certifications on a moment’s notice, there’s a lot at stake during this part of the process. While approaching the closing date, it’s paramount that all real estate brokers, attorneys, and other representatives remain available and responsive.
This is because near the end of your transaction, you will almost definitely face tight deadlines and both new and unexpected requirements. Signatures issued too early in the process may well be void by the necessary time—and everyone involved will need to quickly resign to avoid any delays.
And so, staying organized and well-coordinated is truly indispensable. You will want to make reverifying your closing requirements, dates, and documentation top priorities. The closer you are to the end of your transaction, the more attentive and responsive you will need to be. Every party involved in the commercial transaction must stay in touch to ensure a smooth process.
With awareness and creativity, however, you will be well-equipped to solving any problems that may arise in your commercial closing.