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Tips for negotiating a commercial real estate purchase agreement

On Behalf of | Oct 13, 2023 | Real Estate

Illinois commercial real estate is big business. Illinois Policy reports that Chicago has the second highest commercial property taxes in the United States. With so much money on the line, it’s no surprise negotiating real estate purchase agreements can feel overwhelming.

Maybe you’re not a commercial real estate mogul who excels at making real estate deals. However, you can negotiate like a pro if you have a certain mindset.

Set a price limit and stick to it

You might find a piece of commercial real estate that you feel is perfect. Avoid letting the desire to own the proper override your common sense. Set a limit on how much you’re willing to pay for the property. If the asking price goes above your limit, then it’s time to walk away.

Setting a limit prevents you from overpaying for the property. It’s also possible that the seller will lower the price when it becomes clear you’re not budging on your limit. Negotiating is a part of the game. But you don’t want to keep negotiating and end up paying more than the property is worth.

Approach the deal with respect and understanding

Ideally, both parties will benefit from the real estate deal. Things might not go well if you approach the real estate negotiations with ill intent. It’s best when the buyer and seller work together with a mutual understanding of what they both want.

Keep your best interest in mind

Buyer and seller should work together. However, don’t do anything against your best interest. For example, say you’re the buyer, and the seller asks for a price below market value. It’s not your job to tell the seller they’re not asking for enough. In this case, the seller can get what they’re asking, and you get the real estate you want below market value.

It helps to have goals and a strategy when negotiating real estate purchase agreements. But if the thought of negotiating makes you uncomfortable, you might consider hiring someone to help. In either case, you want to get the best real estate deal possible.