Selling a non-residential property can no doubt be tricky in Massachusetts. In some cases, the issues that crop up during a commercial real estate transaction are beyond the control of the seller. However, in other cases, these issues stem from the seller’s mistakes. Here are a couple of common mistakes that sellers make when selling commercial properties.
First, some commercial property sellers neglect to disclose their tenant defaults. For instance, perhaps certain tenants are behind on their rent, and security deposits had to be applied to cover the missing rent payments. The reality is that the potential buyers of a property will likely uncover such issues as the commercial transaction progresses, and these undisclosed problems may end up jeopardizing the deal.
Second, some buyers struggle with managing their financial records correctly. An important move for commercial property owners is to classify their expenses properly — something with which an accountant can help. In addition, it may behoove them to depreciate their capital expenses and tenant improvements. It might be easier to expense such costs during the year in which they were incurred, but depreciating these expenses over time instead is advantageous long term.
Just as purchasing commercial real estate in Massachusetts can be exciting, selling it can also be thrilling. However, a potentially lucrative deal may end up falling through if a seller does not know how to approach a deal properly, especially from a legal standpoint. Fortunately, an attorney can provide sellers with the guidance they need to execute their real estate sales in the most personally beneficial manner possible.