What’s the Difference Between Residential and Commercial Real Estate Transactions?
The differences are that commercial transactions involved property that is used for business purposes. These include an office buildings, hotels, warehouses and vacant land. The due diligence process is different as there are specialized inspections and income and expense analysis for the property. Also, the lending have different standards than residential.
Commercial property most often involved corporate entities such as a limited liability company as the buyer and seller. Closing a commercial real estate transaction involves reviewing the corporate documentation of the entity in title as well as that of the purchaser. This would entail information as to who has the authority to sign on behalf of the corporate entity.