Commercial real estate matters can have significant financial consequences for business owners. Business owners and investors should protect their investments by making smart legal decisions. Commercial real estate lawyers at Kim & Feliz, LLC can assist clients with negotiation, contracts drafting, and litigation.
Commercial Leases in New Jersey
A commercial lease is an agreement between a Landlord and a business outlining the terms and conditions of the rental property. Commercial leases differ significantly from residential leases because there are fewer consumer protections in place. Therefore, the terms of the lease control any disputes that arise. An attorney experienced in commercial real estate can help negotiate favorable lease terms for clients and draft commercial lease contracts.
Business properties may be subject to zoning laws and other local regulations. The terms of a commercial lease can affect the operation of a business, including what type of business is allowed to operate in a particular rental space. The terms of a commercial lease can affect the tenant's rights to affix signage outside the leased space and the number of parking spaces that customers of the business will be allowed to use.
Most commercial leases charge a base rent, but for many other leases, the rent is all-inclusive and includes payment for basic utilities. Some commercial leases may also charge additional rent based on a tenant's proportionate share of other expenses, which may include taxes, water, sewage, electricity, repairs and other costs for the building. This is often called a Triple Net Lease (NNN). It is important to understand what costs will be covered by the landlord and what costs the tenant will be responsible for paying themselves. An attorney can assist with drafting contracts and explaining the terms of the agreement.
Construction Contracts
Careful contract drafting is essential for the protection of all parties involved in a construction project. Each step of the process should involve an experienced attorney.
It is important for developers and contractors to understand the terms of a contract and what will happen if a dispute arises. A contract should specify the terms of any payments to be made and who will be held liable for the quality of work performed. Contracts usually state where a lawsuit must be filed if there is a dispute and whether or not the parties must participate in arbitration rather than filing a complaint in court. An attorney can help make sure that the terms of the contract are favorable to their client and ensure that it reflects the actual agreement made between the parties.
Construction contracts involve complex transactions. One project often involves a general contractor as well as multiple subcontractors. It is important to consult an attorney experienced in commercial real estate and litigation. Construction deals involve legal issues that are specific to the industry, e.g., a mechanic's lien. A mechanic's lien is filed to ensure that contractors will be paid. Investors should obtain releases from all contractors to prevent future litigation. An attorney can assist with the technical and legal steps business investors should take to protect themselves.
Site Acquisition
Site acquisition is one of the very first steps a developer must take in any commercial real estate project. The developer's objective is typically to gain control of the site as quickly and as affordable as possible. At this stage of the project, the developer may still be trying to secure the funding necessary to complete the project. The developer may still be working out details to ensure the project is feasible. An attorney can help with working out these details to help the developer save time and money.
A purchase agreement should specify what will happen in the event that the developer must back out of the project. For example, if the site does not pass an inspection, the developer may end up needing to scrap the project or choose another site. An attorney can help make sure that the purchase agreement between the seller and developer provides as much protection for the developer as possible in the event that this occurs.
There are many legal factors that go into site acquisition for a commercial space, including zoning laws. In some cases, landowners near a proposed project may object to the acquisition of land for a certain use. Government regulations may restrict the use of some sites. An attorney can help developers request permission from the appropriate agencies to ensure that a project can be completed at a particular site.
Commercial Real Estate Sales in New Jersey
Commercial real estate sellers and buyers can both benefit by having an experienced attorney assist with the sale. Commercial real estate sales often involve the sale of the goodwill of an existing business. The sale of commercial real estate can include complex factors including the following:
- Easements
- Existing mortgages
- Financing
- Lease assignments
- Management agreements.
An easement is a property right that allows a property owner to use property that he or she does not possess. An easement may be created with a written instrument such as a deed. When commercial real estate is sold, it is important to make sure that any easements needed to protect business interests are included in the transaction.
When a business is sold, the new business owner may be required to take over existing mortgage payments. An experienced attorney can help with the negotiation process.
The purchaser of commercial real estate may have the option of taking over any existing lease and management agreements. Existing lease agreements can provide income for commercial real estate purchasers. Management agreements allow business owners to grant the supervising power to another individual so that the business owner can focus on multiple business ventures. Taking over contracts from prior business owners will require the creation of a new agreement.
Contact Kim & Feliz, LLC for Your Commercial Real Estate Legal Needs
For all of your real estate questions, contact Kim & Feliz, LLC today. Our experienced attorneys can help make sure that you are treated fairly and save you time and money. Contact us online or call (201) 585-2250 to schedule an appointment.