Obtaining Commercial Property in Illinois
Obtaining commercial property in the state of Illinois is a multi-step process that requires both sound planning and thorough due diligence. There are many items to keep in mind over the course of this process that will make sure you get the most out of your investment.
Here, we’ll go over a number of priorities to be aware of when obtaining commercial property in Illinois.
Determine Your Purpose
First, you need to know what you’ll be using the land for. Are you looking to build residential structures to rent out? Are you planning to develop the land into a commercial shopping center? Or are you simply looking to add already developed land to an investment portfolio? These will inform the types of property you’ll look at as well as the location, easements, and so forth.
Due diligence is a key part of any investment, and it’s particularly important when purchasing commercial property. There are many items that you’ll need to examine, including:
- Property survey, including title, liens, easements, etc.
- Current liens or claims against the property
- Location of the property, foot traffic, accessibility, etc.
- Zoning restrictions or violations
- Environmental inspections
- Building inspection
- Value versus potential profit
- Existing leases or tenants
Obtaining the proper surveys and knowing the circumstances surrounding the property are key to making a wise purchase, so it’s important to be thorough with your due diligence investigations.
Obtaining Commercial Financing
Once you’ve determined which property you are going to purchase, you will need financing. This can be an involved process all on its own, especially since different lenders will often have their own requirements when it comes to qualifying for financing.
Negotiations of price, inspections, costs, contract terms, and so forth are integral to any commercial real estate purchase. These are best handled by a commercial realtor or real estate lawyer since they are familiar with the laws and norms that permeate these types of transactions.
Real estate contracts of any kind are inherently complex, and in the case of a commercial situation where each party is doing their best to benefit from the transaction (and where some laws don’t necessarily apply), it can often be slanted one way or another. Having a skilled and knowledgeable negotiator on your side is crucial to making sure the transaction is favorable.
In addition, these transactions typically occur between two legal entities, so there will usually be extra steps involved in order to determine how to fit each party is to conduct the transaction.
Once everything has been examined, negotiated, and underwritten (which is typically a highly drawn-out process), the closing process begins. If you haven’t performed due diligence in advance, this will often be the time when it will be handled. If all goes well, you’ll be able to begin using the property since it will be legally titled to you (or rather, to your legal entity).
Throughout the process, a real estate attorney will be able to provide invaluable assistance. Our lawyers at Hart David Carson LLP stand ready to assist you as you purchase commercial property in Illinois.