Let’s be honest, commercial real estate transactions can get a little thick. It is about sifting through contracts, zoning regulations, easements, haggling, and frankly, unending minute hurdles that can derail even the most promising of transactions. Though a good broker can seem like he can handle anything, at times, only a specialized attorney will do.
But how do you know who that person might be? The one who’s not just going to glance through the contract, but understand it – and maybe more importantly, notice the things you didn’t even know to look for?
Let’s guide you through it. Sincerely.
How to Choose The Best Commercial Real Estate Lawyer
Why You Need A Commercial Real Estate Attorney
Beyond Just Legal Documents
Yes, they’ll negotiate contracts, but that’s just the beginning. An expert real estate attorney keeps the big picture in mind. They can spot concealed risks, look out for your interests in lease negotiations, and help structure deals to minimize long-term risks. It’s not all about paperwork — it’s about protecting yourself.
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Think of them as your safety cushion, or smart insurance. They also alert you to risks you may not have considered, like environmental duties or zoning restrictions that could scuttle your project down the line.
Important Characteristics to Look for in Real Estate Lawyers
Commercial Real Estate Transactions Specialist
This might sound simple, but there are plenty of lawyers who work in commercial real estate without exercising a focused practice. Ask them what other deals they did. And not just how many, but what kind. How much experience have they had with office spaces, retail properties, or industrial sites? One has its challenges.
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Strong Negotiation Skills
One of the most important things to look for in a real estate agent is the ability to negotiate.
It’s not just small talk. You need somebody who won’t be intimidated by the developer’s legal team and will be able to negotiate terms for you. It is simply the case that contracts are live, open to negotiation.
Keen Attention to Detail
One forgotten clause could bring years of agony. In this kind of thing, the most fastidious (or possibly pathologically obsessive) person is your best friend.
Communication and Accessibility go Hand in Hand
Steer clear of those attorneys who disappear when you have a problem. Choose someone quick to reply to questions, explains things well, and understands your point of view.
First Steps for the Best Candidate
Asking for Recommendations from the experts in the field
Ask your broker, accountant, or other investors you respect for recommendations to reputable professionals. Early advice/names are very important and wield a lot of power.
Using Online Legal Directories
You may want to look into seeking legal help on the internet, Avvo, Martindale-Hubbell, or your local bar association. Remember, online profiles are curated, so interview thoroughly before you choose.
Assess Abuse Lawyer Websites and Testimonies
Sure, an attractive website is nice, but testimonials and Google reviews can do more to shed light on what a lawyer is doing inside the courtroom than a run-of-the-mill bio.
Questions to Ask Before Hiring a Lawyer
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“In the past 12 months, how many corporate deals have you worked on?”
“What sort of clients do you usually represent?”
Such questions are probing, and the word “relevant” suggests questions beyond mere qualifications.
Understanding Legal Structures for Sophisticated Deals
Some lawyers do this anywhere between; their negotiation style is anywhere between, on the cautious end or the more aggressive end, somewhere in that range. Learn their approach to solving problems involved when dealing with large deals.
Explanation of Fee Schedules and Billing Processes
Find out if the lawyer bills a flat fee or charges by the hour and whether you will be billed for correspondence such as emails or brief phone calls. Get it in writing. No matter how awkward it is, document all agreements.
Red Flags to Watch Out For
Indirection and Lack of Clarity in Communication
And if the discussion is not transparent, perhaps it is because of struggles with managing disputes in a professional manner.
Lack of Specialized Expertise
Although general practitioners are right for some legal needs, they could be the wrong choice when it comes to complex transactions, such as multi-million dollar commercial leases.
Opaque Fee Agreements
Elaborate or difficult-to-understand billing structures would be a red flag and may require more attention.
In this section, we demystify legal fees and payment structure
When To Charge By The Hour vs. Flat Rate
Flat rates provide pricing certainty, and hourly rates can build up pretty fast depending on the difficulty level. The overall setting of the transaction determines which is best.
Retentions and Other Charges
Know what retainers the attorney may require, and what is not covered in the initial fees, so you’re not shocked by unexpected charges later on.
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When you are in Legal Counsel
Want to buy a home? In the process of dealing with a triple-net lease? Working on complex joint ventures? Don’t take chances.
Due Diligence and the Attorney’s Fundamental Role
Confirm Zoning, Licenses , and Titles
Any of these considerations can derail the deal. Get someone who checks all the details carefully.
Consideration of Easements and Environmental Concerns
But these matters aren’t just afterthoughts. Even a profitable deal can become a legal morass. A good lawyer gets down to the nitty gritty, asks the hard questions.
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After a few transactions, they’ll know where you stand. That’s when the magic starts, allowing them to forecast issues before they even manifest themselves.
Benefits of Having Access to Legal Representation
Think of him as a mechanic for your new investments — someone to call with questions about any strange contract clauses or any odd delay from the service provider.
Dealing with a change in counsel
It’s not uncommon. Whether the energy is slow or nonexistent, it’s okay to change it up professionally. Ask for your documents, settle the unpaid balance, and go to a new beginning.
Case in Point: Proactive Work of Competent Attorney
(Example: Let’s call her Mark, a developer who is close to closing a retail property sale). He seemed perfect at first, but his lawyer discovered a buried restriction 60 pages in: a ban on alcohol sales. As a result, the inclusion of the SBE resulted in the proposed lease being in jeopardy due to Mark’s desire to have a wine bar as the anchor tenant.
Checklist: Before Hiring Anyone
Is the lawyer experienced in commercial real estate?
Are they able to prove relevant deal experience?
Do they have an open and fair pricing system?
Can you trust their judgment?
Are they good at explaining things in plain English?
Trust your instincts. Your money is at stake, along with your property and your future.
Closing Thoughts
But a business owner shouldn’t be in a hurry to bring the property to market without the right attorney; commercial real estate attorneys aren’t simply about checking off a box, they can determine whether a decision is good or harmful for your company. Take your time. Ask the tough questions. And then when you find the right match, don’t let go. A non-ineffective attorney can help protect you and FURTHER YOUR UNDERSTANDING, EXPERTISE, AND PREPAREDNESS for future deals.
FAQs
Can any attorney handle a commercial real estate deal?
Not quite. It’s a good thing to have someone more specialized in it — a general practice attorney who’s competent won’t get the same details that might be important in a commercial property.
What is the average cost of a commercial real estate attorney?
Fees can range from $200 to $600 an hour or a flat fee beginning at $1,500, depending on where you live and the complexity of the transaction.
When is the right time to bring a lawyer into it?
Because, if at all feasible, the favorable language should be completed before signing the LOI. They can help shape the terms before they become final.
What if the other driver is represented by a lawyer?
This just highlights the need to have your lawyer. You need someone who’s got your back.
Can I save money on a transaction with the help of an attorney?
Certainly. A good attorney can spot any superfluous fees, ask for better conditions, and protect against costly mistakes down the line.