(Newswire.net — January 23, 2014) Denver, Colorado — Purchasing real estate is a huge investment. This is especially true in the commercial real estate marketplace. Just like any other piece of property, it is especially important for the prospective buyer to do their due diligence before committing to a sale. Local Denver real estate attorney, Eric L. Nesbitt offers ten questions every buyer should ask. “As a commercial real estate attorney,” says Mr. Nesbitt, “I feel you should have these questions answered before you even consider putting in a bid or a down payment on any property.”
The first question you should have answered is perhaps the most important one, and that pertains to ownership of the property title. Making sure the title ownership of the commercial real estate building or parcel is clear is a good way to protect yourself from future legal entanglements. “Be sure you have a clear title and will be granted a general warranty deed for the best protection,” Nesbitt says. Once the title is verified to be clear, you should also make sure that the property lines are accurately surveyed. This will make sure that the property owner hasn’t built onto a neighbor’s property, or vice versa.
The next thing that you should verify is that the property has insurable access. Just because there is a road, doesn’t always mean there is insurable access to the property. This is especially important if you plant to develop the property further. You’re also going to want to make sure that your intended use of the property complies with city and or county zoning code, says Denver real estate attorney Eric Nesbitt.
Whether or not the property was previously used as a gas station, dry cleaners, or any other business that hosts hazardous chemicals, you should obtain a phase one environmental assessment, and a phase two environmental assessment may also be needed, according to Nesbitt. You’re also going to want to make sure there aren’t any liens, permits, or any unpaid municipal liens on the property that would otherwise obligate you to pay for.
Mr. Nesbitt also believes that another important aspect to clarify is the state of the property. Is the roof in good condition? What is the state of the electrical and plumbing? Having these questions answered will expose if the property has been neglected or cared for. You should also know if there are any tenants occupying the property that may or may not have a right to purchase the property. If there are tenants, you should obtain a rent roll. This will detail any obligations to the tenants that would affect your income projections.
The last thing to be requested should be a detailed record of operating expenses and other financial records pertaining to the property. These financial documents dating back prior to your ownership of the property will ensure accuracy in accounting and when making income projections. “These financial records have an impact on the value of the property,” says Mr. Nesbitt, “so the seller should have them readily available upon request.”
By taking the time to ask these questions, you should be well informed enough to make a smart decision when purchasing a piece of commercial real estate. However, having an experienced real estate lawyer will also make sure these issues, among many others, are fully addressed to your satisfaction.
Eric L. Nesbitt is a real estate attorney serving the greater Denver, Colorado area and is currently accepting new clients. Beyond his expertise as a commercial real estate attorney, Nesbitt is also a seasoned bankruptcy attorney, foreclosure defense lawyer, commercial real estate broker and business law attorney. Appointment requests are welcome via phone or through The Law Offices of Eric. L Nesbitt, P.C.’s website.
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