BERYS LAW | Business, Real Estate, Wills/Trusts

Purchasing commercial real estate is a significant investment that carries both opportunity and risk. To protect yourself from unexpected legal issues and financial pitfalls, conducting thorough legal due diligence is essential. This process helps verify that the property is legally sound, properly zoned, and free of encumbrances that could hinder its intended use or value. Here’s a practical legal due diligence checklist to guide you through a smart and secure purchase.

1. Title and Ownership Verification

Start by confirming the seller’s legal ownership of the property. Request and review the property’s title deed and ensure it’s free from disputes. Engage a title company or real estate attorney to conduct a title search to uncover:

• Liens or mortgages
• Easements or rights of way
• Restrictive covenants
• Pending litigation

Clear title is crucial to transfer ownership without future legal challenges.

2. Zoning and Land Use Compliance

Zoning regulations determine how a property ...

In commercial real estate transactions, the stakes are high and the details complex. From due diligence and financing to closing and title transfer, every step must be carefully managed. One crucial mechanism that ensures security and fairness during the process is escrow. Although often misunderstood, escrow plays a vital legal role in protecting both buyers and sellers, ensuring compliance, and facilitating a smooth transaction.

What Is Escrow?

Escrow refers to a neutral third-party service that temporarily holds funds, documents, and instructions on behalf of the transacting parties until all contractual obligations are fulfilled. The escrow agent—usually a title company, attorney, or specialized escrow firm—acts impartially to oversee and execute the conditions of the agreement. Once all requirements are met, the escrow is “closed,” and the funds and property are exchanged accordingly.

In the context of commercial real estate, where transactions involve significant financial inv...

When it comes to commercial real estate, there’s more to a transaction than the price tag or the square footage. One of the most critical yet often overlooked components of a successful deal is the property title. Ensuring a clean title transfer is essential not only for legal ownership but also for protecting your investment from costly future disputes. Whether you're a buyer, seller, or broker, understanding the title process is key to a smooth and secure transaction.

What is a Title in Commercial Real Estate?

In real estate, a title refers to the legal right to own, use, and transfer a property. A “clean title” means the property is free from liens, disputes, unpaid taxes, or legal encumbrances. In commercial transactions, where large sums and complex legal structures are often involved, ensuring a clean title is even more important than in residential deals.

The Importance of Title Due Diligence

Due diligence is the backbone of any commercial real estate transaction. It involve...

Property damage caused by a commercial tenant can lead to significant financial and legal challenges for landlords. Whether it’s structural damage, unauthorized alterations, or neglected maintenance, such incidents not only affect the property’s value but can also hinder its future use or leasing potential. It’s essential for landlords to understand the legal steps they should take to protect their investment and seek appropriate remedies.

1. Review the Lease Agreement

The first step is to carefully review the lease agreement. Most commercial leases contain specific clauses that outline tenant responsibilities related to property care, maintenance, alterations, and damage. These clauses typically require the tenant to return the property in its original condition (reasonable wear and tear excepted) and may include provisions for inspections, security deposits, or required repairs.

Understanding the terms of the lease will help determine whether the damage constitutes a breach and wh...

Commercial real estate often brings together various stakeholders—property owners, tenants, developers, and neighboring businesses. While these relationships can be mutually beneficial, conflicts may arise, particularly in the form of nuisance claims and neighbor disputes. These disputes can affect the value, usability, and profitability of commercial properties, making it essential for stakeholders to understand their legal and practical implications.

What Is a Nuisance Claim?

In the context of commercial real estate, a nuisance claim typically involves an allegation that a property owner or occupant is interfering with the use and enjoyment of a neighboring property. This interference can be public—impacting a larger community—or private, affecting specific neighbors. Common sources of nuisance complaints include excessive noise, odors, vibrations, pollution, lighting, or obstructive signage. In commercial settings, issues may stem from restaurant exhaust systems, manufacturing noi...

When leasing commercial property, tenants often encounter Common Area Maintenance (CAM) charges. These charges cover the costs of maintaining shared spaces within a property, such as lobbies, hallways, parking lots, and landscaping. Understanding CAM charges is crucial for tenants and landlords alike to ensure transparency and fair allocation of expenses. This article explores the key aspects of CAM charges and their implications in commercial leases.

What Are CAM Charges?

CAM charges are additional costs paid by tenants in a commercial lease to cover the maintenance, repair, and upkeep of common areas shared by multiple tenants. These expenses ensure that the property remains functional, clean, and presentable. CAM charges typically include expenses for landscaping, security, property management fees, janitorial services, parking lot maintenance, snow removal, and utility costs for shared spaces.

Types of CAM Charges

CAM charges are generally classified into two types:

• Fixed CA...

Negotiating a commercial lease is a critical step for any business, as it directly impacts operational costs, flexibility, and long-term success. Whether you are leasing office space, retail premises, or industrial property, understanding key lease terms and how to negotiate them effectively can make a significant difference. Here’s what you need to know to secure a favorable commercial lease agreement.

1. Lease Term and Renewal Options

One of the most important factors in a commercial lease is the lease term. Consider whether a short-term lease (e.g., 1-3 years) or a long-term lease (5-10 years) best suits your business needs. Shorter leases offer flexibility, while longer leases may come with lower rental rates. Also, ensure the lease includes renewal options that allow you to extend the term under pre-agreed conditions.

2. Rent and Rent Escalation Clauses

Understanding the rental structure is crucial. Look for clauses detailing base rent, additional costs, and rent escalation....

Leasing a commercial property comes with responsibilities for both tenants and landlords. One of the landlord’s key obligations is to maintain the property and ensure it remains in a safe and functional condition. However, there are instances where landlords fail to make necessary repairs, causing inconvenience and potential financial loss to tenants. If you find yourself in this situation, here are the steps you can take to address the issue effectively.

1. Review Your Lease Agreement

The first step in resolving any repair dispute is to review your lease agreement carefully. The lease should outline the landlord’s obligations regarding maintenance and repairs, as well as the tenant’s responsibilities. Understanding these terms will help you determine whether the landlord is in breach of contract.

2. Notify the Landlord in Writing

If you identify a necessary repair, inform your landlord in writing as soon as possible. Clearly describe the issue, its impact on your business, and r...

When dealing with commercial real estate, understanding the key legal terms in property contracts is crucial for protecting your interests and ensuring a smooth transaction. Whether you are a landlord, tenant, buyer, or seller, being familiar with these terms can help you avoid costly legal disputes and make informed decisions. Here are some essential legal terms and strategies to safeguard your commercial property investments.

Key Legal Terms in Commercial Property Contracts

Lease Agreement

A lease agreement is a legally binding contract between a landlord and a tenant that outlines the terms and conditions of the rental arrangement. Key elements include lease duration, rental amount, renewal options, and responsibilities for property maintenance.

Rent Escalation Clause

This clause specifies how and when rent will increase over the lease term. Rent escalations can be fixed (e.g., a set percentage increase annually) or tied to economic indicators like the Consumer Price Index (C...

The Americans with Disabilities Act (ADA) is a landmark civil rights law enacted in 1990 to ensure equal access and opportunities for individuals with disabilities. One crucial aspect of the ADA is its impact on commercial properties, mandating accessibility in facilities open to the public and places of employment. Compliance with ADA regulations is not only a legal obligation but also a step toward inclusivity and equity. This article provides an in-depth understanding of ADA compliance for commercial properties.

What Is ADA Compliance?

ADA compliance refers to adherence to the guidelines established under the ADA, particularly those outlined in Title III and Title I. Title III applies to public accommodations, including retail stores, restaurants, hotels, and offices, requiring them to be accessible to individuals with disabilities. Title I focuses on ensuring accessibility for employees with disabilities within the workplace.

Compliance encompasses the removal of architectural b...