Letter of Intent: Agreement to Agree
The first step in solidifying terms of a commercial real estate transaction is the Letter of Intent.
The Letter of Intent (“LOI”) contains the essential terms of the transaction and is often executed before the parties negotiate terms and provisions within the contract. Key terms a prospective buyer of commercial real estate should consider include the Purchase Price, duration of Investigation Period, and the Earnest Money Deposit.
The terms should be negotiated, based on a wide variety of factors pertaining to the property condition, existing business, and potential restrictions for current use or future development, and finalized prior to signing the LOI.
Investigation of Commercial Property
Purchasers should identify the key business terms of the transaction prior to signing the Letter of Intent.
We represent developers, investors, and owner-operators in the acquisition and sale of a wide variety of commercial properties including multi-family housing, office buildings, shopping centers, franchised hotels, independent motels, convenient stores, and gas stations.
NEGOTIATING THE PSA
The Purchase and Sale Agreement (PSA) defines the rights and responsibilities of the parties involved and will define the investigation timeline and notice requirements. Commercial real property agreements should be tailored to account for intended us of the property as well as existing or planned leasing and financing, or future sale of the property.
A prospective purchaser can ascertain the basic legal description from the county records; however, this description alone does not reveal access rights or restrictions, easements for utilities, and possible limitations for development if intended.