Tips From Auckland Lawyers for Selling Commercial Property
Commercial property is a complex industry. Many real estate investors start with residential rentals but baulk at entering the commercial property market. The complexities, the numbers involved, obligations, and compliance issues can put off potential investors. However, it can be a lucrative investment if you have good legal backing from one of the Auckland lawyers for selling commercial property.
In this article we will look at some of the issues involved and how Auckland lawyers for selling commercial property will help new and experienced real estate owners.
Why Hire an Auckland Commercial Property Lawyer?
Successfully selling commercial property in Auckland has many branches. There is the obvious legal branch, but others include possible tax issues, providing seller finance if necessary, clearing mortgages if any, compliance to ease the sale, and more.
A commercial property lawyer will be able to assist with these. They can advise on the various aspects, negotiate the terms, carry out a range of transactions, produce and review documents, and arrange settlement of any financial obligations. This is a guide from the Real Estate Authority with issues to consider.
Actual Services From Auckland Commercial Property Lawyers
Negotiating The Deal
Commercial property deals are more involved than agreeing a price for a house. Cashflow is the key factor in owning commercial property. To make this attractive to a potential purchaser, you will need to ensure certain issues are in place. Some of the factors to take into account are tenants, if any, the length of the tenancy, rent reviews, maintenance projects both when and the cost, insurance risks, and more.
With these issues in mind, and the delicate nuances behind them affecting the overall sale price,
lawyers often carry out negotiations for their client. Do not be embarrassed about calling upon their knowledge and experience in commercial real estate deals
Drafting and Reviewing the Contract
If your lawyer is not using the Law Society Sale and Purchase Agreement they will draft the sale contract specific to your transaction.
If the buyer wants to make amendments, your lawyer will review these and consider a response or course of action from your end.
Finance
Commercial property finance can involve a number of lenders rather than a single bank like a residential purchase. Many times, seller finance is involved.
In this situation, the seller retains an interest in the premises acting like a mortgage lender. For the seller, they receive a cashflow income. For the borrower or buyer, they have a potentially easier source of capital from a lender that knows the building.
In other cases, the seller might have a mortgage or mortgages over the property. To clear this there has to be sufficient money to be paid to the lender. Depending on the time of purchase, sometimes the sale does not produce enough money to repay the loan. In this case, the seller will have to find additional sources of money to fully settle the mortgage.
Tax is sometimes a consideration, especially GST. Your lawyer will have an accounts department that will work out any tax liabilities.
Picking Auckland Commercial Property Lawyers
Before you choose a lawyer, consider the following points.
Do they specialise in commercial property? A residential real estate lawyer is unlikely to have the skills or experience to handle a major commercial deal.
Look for a lawyer who can show you actual commercial property transactions they have successfully managed.
Ask about their reputation. What do commercial real estate agents think about them? Are there positive reviews online?
Open and transparent. The legal aspects of a commercial property deal is not going to be cheap but at the same time you don not want a huge, unexpected bill at the end of the matter. Ask for a cost indication at the start. Ask to be kept informed if there are any major costs along the way,
Summing Up
For any commercial property it is imperative to hire a skilled lawyer to steer you though the process. McVeagh Fleming in the centre o the CBD has a team of experienced Auckland lawyers for selling commercial property. You can find out more on their website.