If leasing the property post-transaction, consider the type of lease agreement:
- Gross Lease: Tenant pays a fixed monthly amount covering rent and operating costs.
- Net Lease: Tenant pays rent plus expenses like taxes, insurance, or maintenance (single, double, or triple net leases).
- Percentage Lease: Tenant pays a base rent plus a percentage of gross sales.
Standard lease terms include duration, rent amount, escalation clauses, maintenance responsibilities, and default provisions. While lease agreements contain common clauses, landlords often tailor provisions to fit specific needs.
Factors Influencing the Transaction Timeline
Several factors impact how long a transaction takes:
- Market Conditions: High-demand markets tend to move faster than slower markets.
- Property and Transaction Complexity: Size, permitted use, or multiple parties can extend due diligence and approval times.
- Financing Delays: Large loans may require extra documentation or appraisals, slowing the process.
- Legal and Regulatory Issues: Disputes, zoning restrictions, or environmental concerns may require additional time and resources.
- Due Diligence Requirements: Delays may occur due to incomplete documents or uncooperative parties.
- Negotiation Challenges: Prolonged negotiations can delay closing; hiring an attorney can help navigate disputes.
Common Reasons Deals Die
- Open Permits (e.g. electrical, LAA, etc.) | Combined Units | Zoning
- Financing Considerations a. “All Cash” vs. Non-Contingent| Financing vs. Funding Contingency
- Local Law 11: DOB NOW to see if a building is designated as “Unsafe”
- “SWARMP” Safe with a Repair and Maintenance Program
- Communication Issues Between All Parties: Responsiveness | Deal Sheet Accuracy
