It is important to be prepared for commercial real estate opportunities when they come up. A Florida company recently purchased a 390-unit apartment complex for $37 million in a Miami suburb. The buyer plans to update the complex and has interior and exterior renovations planned which will cost $3 million. The complex will also be renamed. The commercial real estate transaction was financed with a $33.5 million loan. The 170,900 square foot complex is reportedly 98 percent occupied and was listed for sale at a price of $41 million.
The recently purchased apartment complex is near a planned $1 billion theme park and a mixed-used development with plans to add 600 new apartments to the area, among other attractions in the area where the complex is located. Commercial real estate transactions are an important feature of many businesses but can be complex with a number of moving parts and important considerations to take into account.
From negotiations, to due diligence, to drafting a purchase or sale agreement, to executing an agreement to purchase commercial real estate, there are a variety of parties involved and legal considerations to take into account. Following that, it may be necessary to engage construction companies, property management companies and others to fully develop the project. A solid understanding of the contract relationships involved is important for parties to a commercial real estate transaction.
Commercial real estate transactions can be complicated and challenging at times but can also be tremendously rewarding. The more familiar the parties are with the process, and the legal tools to help them along the way, the better opportunity they, and their project, have for success.
Source: The Real Deal, “Apartment complex in Country Walk sells for $37M,” Sept. 7, 2017