How the contract structures the deal
The buyer's deposit is commonly held in escrow, often by the seller's attorney or a title company, and the contract usually says when it becomes non-refundable. Due diligence periods, financing contingencies, and title objection procedures are negotiated rather than implied, and New York generally does not require sellers of commercial property to disclose defects. A closing date in a New York contract is often not treated as firm unless the contract says time is of the essence or a party later makes it so by proper notice. If the buyer defaults, the seller's remedy is frequently limited by the contract to keeping the deposit. Sellers often resist financing contingencies in commercial deals, so buyers who need a loan usually line up the lender before signing.
What diligence should cover
Title and survey review should confirm what easements, liens, and restrictions affect the property. Zoning and certificate of occupancy checks confirm the current use is lawful. For leased buildings, tenant estoppel certificates and the leases themselves verify the rent roll the price was based on. Environmental assessments, building condition reports, and violation searches round out the picture. Transfer taxes and, where relevant, a like-kind exchange schedule should be coordinated with your accountant early, since those timelines do not wait for the closing. Service contracts, warranties, and leases that will pass to the buyer should be listed in the contract rather than assumed.
Reviewing the draft
We read the draft for how the deposit is protected, what representations the seller makes and how long they survive closing, and what happens if title problems or casualty damage arise before closing. For sellers, the review focuses on limiting post-closing exposure and making the buyer's obligations clear. A first meeting covers the business terms already agreed, the timeline, and which provisions are worth negotiating. We also flag where the commercial real estate purchase agreement leaves a gap that the parties would otherwise fill by assumption.
