Legal Aspects To Consider Before Selling Your Business Property

The main focus of an investor who is looking to buy a commercial property is ROI, especially during the COVID-19 outbreak. They want to know the property is valuable and that they can use it to generate income as soon as possible. Still, this doesn’t mean the seller should forgo legal aspects for the sake of making their property desirable and accessible to anyone interested.

As such, I listed some of the most important legal precautions to keep in mind when selling.

Make All the Preparations Before Posting the Ad

Just like when you want to sell personal property, it’s best to make sure everything is sorted out before you put it on the market. In the case of commercial property, the owner should make sure all the features are up to standards and that all damages are fixed.

This step includes sprucing up the property, to make it as attractive as possible. Curb appeal is just as important when you’re selling business property! In fact, it may be the factor that lets your broker find the best price in a timely manner.

Also, from a legal point of view, make sure you have the right to sell the property and that there are no debts or conflicts attached to it. Also, gather all the relevant documents such as copies of leases, rental agreements, environmental reports, mortgage information, and more.

Lastly, it’s important to have the property inspected for the purpose it serves (an office building, an industrial hall, and so on). By having this inspection now, you have the chance to identify and repair any problems that could hinder the sale or drive possible buyers away.

Get an Exclusive Commercial Agent

A commercial agent is mandatory if you want the project to move on quickly and get the best possible price on the property. This is true because most commercial agents have connections in the market and know where to market the sale in order to attract the right type of possible buyers. This saves you both time and money (real estate agent commission is based on the sale price, so they're interested in finding the best deal for you).

Furthermore, an agent should be a member of an accredited trade body so they can offer insurance (in case of damages) and provide you with a detailed valuation report before getting the property out.

Talk to a Lawyer

A commercial sales procedure requires the attention of a specialized lawyer who can recommend the right paths to take. They will also take care of the documentation required for a commercial property sale, whether it’s best to use a bill of sale with a warranty, they will cover the exchange of contracts with the buyers’ attorneys, and so on. Lastly, a lawyer can verify and vouch for the money transfer and its legality and is there to answer questions you may have along the way.

Set a Pricing Strategy

This is something you should discuss with your commercial agent and your lawyer, to make sure the final price is reasonable for all the parties involved in the process without hindering the sale.

Start by comparing your property with similar ones in the area focusing on price, location, purpose, amenities, lease rates, and so on. Your agent will be of great help with this step since many of the commercial databases are not public. You should also pay a visit to other properties for sale (in the area) to see how other agents handle things.

Lastly, it’s best to document the strategy and make sure you’ve covered all legal aspects - a step where your attorney could get involved.