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Contact us by filling out the online form or calling us at (315) 255-3368. to schedule a free initial consultation and to learn more about real estate investments.
Contact UsBuying commercial real estate in New York is not like purchasing a new family home. The costs are more, the funding is harder to get, and to top it off if you need tenants, you will have to cover the expenses of marketing, identifying, and securing new leases. Purchasing commercial property for a new investment endeavor or a new business is rewarding and can be quite profitable if the process is undertaken strategically and in compliance with state, city, and local laws.
At Testa Law Firm, we handle commercial property transactions from start to finish. We will discuss what your goals are, help you find the right property, negotiate contracts, and more. Contact us at 315-255-3368 to schedule a free initial consultation and to learn more about our commercial real estate services.
Commercial real estate (CRE) is property used for purposes related to business rather than residential. A CRE can be a mom-and-pop store or a huge shopping mall and includes restaurants, hotels, office spaces, hospitals, and doctors' offices. CRE is generally broken down into five distinct categories: industrial use, multi-family rentals, office space, hospitality, and retail.
Buying commercial real estate can prove a valuable investment if it is handled correctly. There are various steps to purchasing a CRE, though the exact process may vary depending on the jurisdiction.
The first order of business is to locate the property to be purchased. While this may seem an easy task, there are many things that must be considered, including:
A real estate lawyer who specializes in CRE properties can help you find exactly what you are looking for in a CRE.
The property will definitely have an asking price, but the purchaser must do their homework to ensure they do not offer too much initially. There are different approaches used in the industry, but two of the most popular are:
There may be other ways to calculate the offer price depending on the CRE being purchased.
The purchase and sale agreement contains all the terms of the sale and should include everything agreed upon between the seller and purchaser. At Testa Law Firm, we will negotiate, draft, review, and analyze these agreements to ensure they favor your needs and that there is no hidden language that may negatively impact you or your property.
Securing financing for the property can be a complicated task, but due diligence must be performed to ensure the best terms are found. You should compare several lenders before settling on one. You want to know what the interest rate is, what the fees are, and whether there are penalties. Commercial property financing options that can be employed for various purposes include:
In most cases, the purchaser of the CRE will put a down payment of 20-40% of the purchase price and finance the rest of the purchase price amount. We work with several commercial real estate lenders and can recommend one that best fits your needs.
Once all the terms of the agreement have been agreed upon and the financing obtained, the purchaser can move forward with buying the property. Other important matters, such as a title search and execution of the documents, must take place before the keys are actually exchanged. Once the purchase has been completed, the buyer can move forward with their plans for the CRE.
Before purchasing a CRE, there are various questions to consider, including:
Other factors exist, which is why it is a good idea to hire someone who specializes in this area to provide legal and professional guidance during the purchase process.
If you are purchasing commercial property for investment purposes, several different strategies exist that could prove beneficial in this type of investment. Some of the most common real estate investment strategies include:
If you have not yet decided on how you wish to invest in commercial property, at Testa Law Firm, we can help you determine a strategy most suitable for your goals. Each strategy involves different roles, responsibilities, and requirements, and so each should be carefully considered.
Seller disclosure requirements vary from state to state. In fact, many states do not require the same (if any) disclosures for commercial properties as they do for residential properties. Some states specifically outline what information must be disclosed, while others leave it up to the seller to choose whether or not they want to disclose any information. Typically, most states still require disclosing any property defects or environmental concerns even if the property is a commercial one.
As a commercial property purchaser, it is imperative that you are aware of your jurisdiction's disclosure requirements and that you receive accurate information from the seller. You should also inspect the premises. All of this is critical if you live in a state that does not strictly regulate commercial property like they do residential properties.
Buying commercial property is not simple, but it is profitable – much more profitable than residential properties, plus your money is secured to something physical helping protect it. At Testa Law Firm, we will guide you through any commercial property purchase, making sure the transaction goes smoothly.
Contact us by filling out the online form or calling us at (315) 255-3368. to schedule a free initial consultation and to learn more about real estate investments.
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