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The Chicago real estate market is competitive, dynamic, and exciting, which can naturally lead to questions. Whether you are buying or selling, there are bound to be questions about the legal distinctions between residential vs. commercial real estate transactions in Chicago. While both categories fall under the purview of real estate law, residential and commercial real estate are often handled in noticeably different ways. There are several important legal distinctions between residential vs. commercial real estate in Chicago that you need to know before you move forward on that exciting real estate purchase or sale.
Are Commercial Reat Estate Transactions More Complex?
The first legal distinction to keep in mind regarding the differences between residential vs. commercial real estate is the complexity of the transaction. In Chicago, as in most real estate markets, it is considerably easier to purchase or sell residential properties over commercial ones. This is partly because there are fewer parties involved in a residential transaction. Commercial real estate transactions are more complex since the transaction must meet certain state and local requirements and regulations prior to the completion of the transaction. The closing process is also more complex for commercial properties and may require signature authority to be verified.
Who is Involved in Residential vs. Commercial Real Estate Transactions?
In a residential real estate transaction, the parties involved typically include the buyer, seller, real estate agent, and legal counsel for either party. In a commercial real estate transaction, these key figures are present while adding additional parties such as lenders, brokers, business partners, escrow agents, and any other relevant individuals or entities. It is also important to note that residential properties are often bought by individuals while commercial real estate may be bought by an entire team of business figures or investors. The fact that so many parties are involved showcases why it is crucial to have experienced real estate lawyers to advocate on your legal behalf during commercial real estate transactions.
What Requirements Differ between Residential vs. Commercial Real Estate?
In addition to the complexity and how many parties are involved in the transaction, the requirements also differ between residential and commercial real estate transactions. For example, while a residential real estate property must meet certain zoning requirements and pass an inspection, commercial real estate properties have stricter requirements and more thorough inspections often conducted by multiple agencies. Commercial property is subject to additional requirements such as passing environmental, zoning, and structural investigations. Commercial property needs to be safe for the general public in order to comply with regulations.
Do Commercial Real Estate Transactions Take Longer Than Residential Transactions?
Due to the complex nature of the transaction and the multiple parties involved, it makes sense that a commercial real estate transaction takes considerably longer than a residential real estate transaction. There are simply more moving parts to coordinate with a commercial real estate transaction. While there may be delays when dealing with residential real estate from time to time, commercial real estate rarely reaches the finish line without a few (or several) delays in the process, which is why it is important to have your own legal counsel from an experienced real estate lawyer in the Chicago area. By working with a lawyer familiar with the delays common to commercial transactions, you may be able to anticipate and avoid delays with their guidance.
Find Legal Help Today
Whether struggling with the complexities of commercial real estate, or you have questions about residential transactions, the first step is to speak with an attorney. From answering questions in-depth to navigating the entire process by your side, an experienced real estate lawyer is a crucial component to success in any type of real estate closing or real estate transaction. Contact our law firm today at 773-232-6643 for additional information and free consultation. With over three decades of serving Chicago, our firm is ready to help you solve any real estate law matter in a timely manner.
