New York City has always and will always be the best city to operate a business. Recent research shows that businesses in New York City are growing at record-breaking rates. If you want to get into business in NYC, having an excellent piece of commercial real estate will take you far.
If you're ready to get started in the New York real estate market, then it's critical that you understand all aspects of commercial property due diligence. Not sure where to get started? Read on for a quick introduction!
Get a Title Report
When you purchase any piece of property in NYC, the end goal is to have your name on the title. You need to make sure that nothing is standing in the way of you getting the title, free and clear. That's where the title report comes in.
Title reports are usually completed by title insurance or abstract companies. The title report gives you all of the information you need to know about the property before you finalize the sale. Typically, it is the first thing you'll want to do after you've agreed to purchase a property.
Ask your broker for the information you should look for in the title report when you hit the NYC real estate market.
Look at the Mortgage Chain
The mortgage chain refers to information about mortgages that currently encumber a piece of property. Some ambitious business owners will take a risk and assume the current mortgage. Most frequently, you'll want the seller to either pay off the mortgage or reassign it to the buyer's lender.
Zoning Report
When you're struggling to decide which property is right for you, consider taking a peek and the zoning report. Every city has zoning laws that dictate what types of buildings and activities are allowed in specific areas of the city. You wouldn't want to purchase a building that's in an industrial zone if you want to open a restaurant, and vice versa.
The zoning report gives information about whether the building is up to code. For example, the following items could pop up:
- Parking requirements
- Construction restrictions
- Setbacks
- Coverage requirements
Restrictive Covenants
Finally, you want to check if the building you purchase is subject to any restrictive covenants. These aren't always a bad thing, but they can impact the way you use and upgrade the building. Covenants are attached to the land, not the buyer, so they are passed down.
Need Assistance with Commercial Property Due Diligence?
Buying commercial real estate in NYC is one of the best property investment strategies you can make. Knowing what to look for when you're conducting your commercial property due diligence is the best way to ensure you make a solid purchase. Don't forget to hire a professional to help you get a holistic perspective and spot things you might otherwise miss!
There is no shortage of property management companies in New York. PMI New York City delivers high-quality products and representation that you can't get anywhere else. Contact us today to learn how we can help you find the perfect piece of commercial real estate!
