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Real estate law for Westchester County and the greater New York area
Commercial Purchases and Sales
Commercial real estate transactions in New York involve significantly more complexity than residential closings. The contracts are longer and more heavily negotiated. Due diligence extends beyond title to environmental conditions, zoning compliance, lease review, and financing structures. The consequences of an overlooked issue are proportionally larger. Buyers and sellers of commercial property in New York need experienced transaction counsel from the outset, not just at the closing table.
Parandian Law represents buyers, sellers, and investors in commercial real estate transactions across Westchester County, New York City, Rockland County, and Orange County. We handle various property types including office buildings, retail properties, mixed-use properties, industrial facilities, and multi-family investment properties. Our services extend from letter of intent through closing and post-closing.
Commercial real estate transactions often involve financing structures, entity considerations, and tax planning dimensions. These aspects require coordination with the client’s accountant and lender. We manage the legal side of the transaction while ensuring collaboration with other advisors to address the full picture before closing.
Commercial Real Estate Attorney New York · Commercial Property Attorney Westchester · Investment Property Attorney · Commercial Closing Attorney · Due Diligence Attorney New York · Commercial Contract Review · Multi-Family Property Attorney · 1031 Exchange Attorney New York
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New York commercial real estate framework
Commercial purchases and sales — the essentials
Commercial real estate transactions in New York typically begin with a letter of intent. This document outlines the key economic terms of the deal before a formal purchase and sale agreement is drafted. The letter of intent is generally non-binding regarding price and structure but sets the framework for subsequent negotiations. The purchase and sale agreement is a fully negotiated document covering price, deposit, due diligence period, representations and warranties, conditions to closing, and post-closing obligations. Unlike residential contracts, there is no standard form; each agreement is drafted from scratch or heavily negotiated based on individual circumstances.
Due diligence in a commercial transaction extends well beyond title review. A buyer should investigate zoning compliance, certificate of occupancy status, environmental conditions, existing leases, tenant estoppels, service contracts, pending violations, and the physical condition of the improvements. In New York, environmental due diligence is particularly critical for industrial and mixed-use properties with prior commercial use. Financing a commercial acquisition typically involves a commercial mortgage, which has more extensive lender requirements than a residential loan. This can include environmental reports, appraisals, and occasionally a Phase I environmental site assessment. We manage the legal due diligence process and coordinate with the buyer’s lender and other advisors throughout.
Key FACTS
Contract type:
Fully negotiated, no standard form
Due diligence period:
Typically 30 to 60 days
Common starting point, typically non-binding
Phase I commonly required by lenders
Transfer taxes:
NY State, NYC, and mansion tax may apply
1031 exchange:
Available for investment property dispositions
Entity structure:
LLC acquisition common for liability protection
Post-closing obligations:
Tenant notifications, lease assignments
What we handle
Commercial real estate services
Buyer, seller, and investor representation for commercial real estate transactions across Westchester County and the greater New York area.
Purchase and sale agreement negotiation
Drafting and negotiation of commercial purchase and sale agreements covering price, deposit, due diligence period, representations and warranties, closing conditions, and post-closing obligations. We represent buyers and sellers and negotiate terms that reflect our client’s position and protect their interests throughout the transaction.
Commercial due diligence
Legal due diligence on commercial properties including title review, zoning and certificate of occupancy analysis, lease review and tenant estoppel coordination, violation searches, environmental report review, and service contract analysis. We identify issues that affect value or risk before our client is committed to closing.
Financing and lender coordination
Coordination with commercial lenders on mortgage documentation, title insurance requirements, environmental reports, and closing conditions. We review loan documents, advise on lender requirements, and ensure all financing conditions are satisfied so the transaction closes on schedule.
Closing and post-closing matters
Management of the closing process including preparation and review of all transfer documents, transfer tax filings, deed recording, and title policy issuance. We also advise on post-closing obligations including tenant notifications, lease assignments, and any surviving representations or indemnification obligations under the purchase agreement.
How it works
Our commercial real estate process
01
Letter of intent and contract negotiation
We review or draft the letter of intent setting out the key deal terms and then negotiate the purchase and sale agreement. Commercial contracts are fully negotiated documents and the terms agreed at this stage drive the rest of the transaction. We protect our client’s interests on price adjustments, due diligence rights, closing conditions, and representations before the contract is signed.
02
Due diligence
We manage the legal due diligence process during the contract’s due diligence period, including title review, zoning analysis, lease review, violation searches, and coordination with the buyer’s environmental consultant and lender. We surface issues that affect value or risk and advise on whether they warrant a price adjustment, additional representations, or termination of the contract.
03
Closing preparation
We coordinate with the title company, lender, and opposing counsel to prepare all closing documents, confirm transfer tax calculations, and ensure all conditions to closing are satisfied. We review all closing documents with our client before the closing date so there are no surprises at the table.
04
Closing and post-closing
We attend the closing, manage the execution and delivery of all transfer documents, and confirm deed recording and title policy issuance. After closing, we advise on post-closing obligations including tenant notifications, lease assignments, and any indemnification or escrow arrangements surviving the closing.
Common questions
Commercial purchases and sales FAQ
What due diligence should a buyer conduct on a commercial property in New York?
A thorough commercial due diligence investigation in New York should cover title review and title insurance, zoning compliance and certificate of occupancy status, existing leases and tenant estoppels, open violations and environmental conditions, physical inspection of the improvements, review of service contracts and warranties, and analysis of financial performance if the property is income-producing. Lenders financing the acquisition will typically require a Phase I environmental site assessment and an appraisal as conditions of the loan commitment. The scope of due diligence should be calibrated to the type and history of the property. We manage the legal due diligence process and coordinate with other advisors on the non-legal components.
What is a 1031 exchange and can it apply to my commercial sale?
A 1031 exchange, named for Section 1031 of the Internal Revenue Code, allows an investor to defer federal capital gains tax on the sale of investment property by reinvesting the proceeds into a like-kind replacement property within a defined timeframe. The seller must identify the replacement property within 45 days of closing the relinquished property and close on the replacement within 180 days. The exchange must be facilitated by a qualified intermediary who holds the proceeds between the two closings. New York recognizes 1031 exchanges for state tax purposes as well. We advise on the legal requirements of a 1031 exchange and coordinate with the client’s accountant and qualified intermediary on the tax dimensions of the transaction.
Should I purchase commercial property in an LLC?
Purchasing commercial property through an LLC is standard practice in New York for several reasons. An LLC provides liability protection, shielding the owner’s personal assets from claims arising out of the property. It also simplifies future ownership transfers, allows for multiple investors to hold interests in a single entity, and can provide estate planning benefits when coordinated with the owner’s broader plan. Lenders financing commercial acquisitions are generally comfortable with LLC borrowers, though they will typically require personal guarantees from the principals. We advise on the appropriate entity structure for each acquisition and coordinate with the client’s accountant on the tax implications of the chosen structure.
What transfer taxes apply to a commercial real estate transaction in New York?
Commercial real estate transactions in New York are subject to New York State real property transfer tax of 0.4 percent of the consideration. Properties sold for two million dollars, or more are subject to an additional New York State transfer tax of 0.25 percent under the mansion tax provisions applicable to commercial property. New York City imposes its own commercial real property transfer tax on properties within the five boroughs at rates that vary based on consideration and property type. Westchester County does not impose a separate county transfer tax on commercial transactions. Transfer taxes are typically the seller’s obligation in New York, though the allocation can be negotiated in the purchase agreement. We calculate applicable transfer taxes and coordinate their payment as part of every closing.
Related services
Often considered alongside Commercial Purchases and Sales
Have a commercial transaction coming up?
Commercial real estate transactions in New York move quickly and the consequences of an overlooked issue are significant. Get experienced transaction counsel on your side before you sign a letter of intent or purchase agreement.
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