Commercial and Residential Real Estate
Commercial Purchases
- Purchasing real estate using a Limited Liability Company (LLC) or Limited Partnership (LP)
- Clarity for profitability of the operating business – below market rents do not distort the profitability analysis
- Limits liability in the event someone is injured on the premises
- Can be a vehicle for estate planning. Real estate can be owned by the next generation or by family members who are not actively involved in the operating business.
- Every separate piece of real estate should be in a separate entity to limit liability cross contamination with the operating business
- Should always consider the tax impact of real property transfers
- State Transfer tax may apply
- Some states charge a separate transfer tax on mortgages
- Foreign Investment in Real Property Tax Act (FIRPTA) requires federal tax withholding on the sale of US real estate by a non-US person, including sales of limited liability entities. We recommend separating an operating business from any underlying real estate and placing the real estate in a limited liability company
- State Transfer tax may apply
Commercial Leases
There are many issues involved in commercial leases. We represent landlords and tenants and can advise you accordingly. Through a related company – Bayard Farms LLC – we can help you manage your real estate investments.
Remember only an attorney will exclusively represent and protect your interest. Realtors and Title Company officers can represent multiple parties including themselves.
There are many issues involved in commercial leases. We represent landlords and tenants and can advise you accordingly. Through a related company – Bayard Farms LLC – we can help you manage your real estate investments.
Remember only an attorney will exclusively represent and protect your interest. Realtors and Title Company officers can represent multiple parties including themselves.
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Anatomy of a Real Estate Transaction in New Jersey
- Contract of Sale is prepared by a Realtor/Broker and signed by all parties
- Attorney Review - In NJ attorney review is concluded three (3) business days following the delivery of a completely executed of Contact of Sale to all parties. You do not count the day the Contract is delivered, Saturdays, Sundays or holidays. An attorney may cancel the Contract at your request for any reason or no reason.
- Inspections - New Jersey contracts call for inspections for the following:
- Structural defects
- Environmental defects, including asbestos, radon, underground storage tanks and some forms of insulation and exterior coatings. A visual inspection of the subject and surrounding properties before you sign the contract can reveal an environmental problem.
- Mortgage financing contingency – A New Jersey residential buyer will generally be given six weeks to obtain a standard 30 year mortgage.
- Residential Certificate of Occupancy - A smoke detector/carbon monoxide certificate is required in all New Jersey municipalities along with a sump pump inspection. Some towns require more inspections, which are made for the Buyer's benefit.
- Land use and zoning – buyers rarely consider the potential impact of zoning. Some properties do not conform to the current land use ordinance. In some cases, these are “grandfathered.” This means that the use is “non-conforming” but can continue. To qualify as grandfathered, a use must have been legal when it began (before the ordinance was adopted) and have been continuous since the ordinance was adopted. A gap of six months or less in that use can void a grandfathered use.
- Title Insurance – required in most purchases, and generally considered to be a good investment. Rates are set by statute.
- Property Survey – while sometimes not required, a current survey by modern methods is worthwhile and required if the property will be redeveloped.
- Closing – At the closing you should be represented by an attorney who can knowledgeably review all final adjustments and explain all of the documents that you will be required to sign. Your home may be the most expensive thing you ever buy. While a Realtor or Title Agent may tell you, “you don't need an attorney,” do you really want to buy the most expensive thing you will ever own without an attorney's review?
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