Commercial Real Estate Law in Illinois

In Elburn, Illinois, "commercial real estate" is any form of land or building which is utilized for a business, as opposed to residential, purpose.

The Elburn, Illinois laws regulating commercial real estate differ significantly from the laws that cover residential and other types of real estate.

People who buy and rent residential unites have a greater deal of legal protections not available to buyers of commercial property.

For instance, commercial real estate usually isn't covered by rent control laws, nor does it carry with it an implied warranty of habitability (because people generally won't be living in it). Furthermore, it also doesn't come with a covenant of quiet enjoyment. However, some of the most basic legal protections (such as laws against fraud, and concealment of defects) apply in both the commercial and residential context.

Common Commercial Real Estate Law Issues in Elburn, Illinois

Financing: Some small businesses in Elburn, Illinois find it necessary, at some point, to purchase a piece of real estate, for various reasons. Nonetheless, most owners of small to medium-sized businesses can't afford to make a real estate purchase up front, with the cash they have on hand. Simply put, very few individuals have hundreds of thousands of dollars just sitting in the bank. One solution to this is a mortgage, which is similar to most other forms of secured loans: a bank lends you money, and you put up some piece of property as collateral, so the bank has some security in the event of default. With a mortgage, however, the property being purchased with the loan also secures the loan, allowing the bank to foreclose on it in case the buyer defaults.

Concealment of Defects: Sellers and lessors of commercial real estate are under a duty to disclose any defects in the property which might impact the buyer's decision to purchase it, such as water damage, mold, or other structural problems. These defects are quite typical, and the buyer has a right to know about them. If the seller doesn't disclose these defects, where they exist, the buyer can sue for any harm this causes.

Duty to Inspect: This is a companion to the duty to disclose defects. Generally, buyers of real estate are expected to inspect the property. If they fail to conduct a good inspection, they might not be able to recover damages if they are harmed by any defects which an inspection would have revealed.

Encumbrances: Undisclosed encumbrances are defects of another sort: defects of title. An encumbrance is any interest that a third party has in the Elburn, Illinois commercial real estate. These usually take the form of easements, which are rights held by third parties to use the land for a specific purpose. Easements can have profound effects on how a new owner can use the land, so it is critical to know about them before buying.

Can a Elburn, Illinois Attorney Help?

Because of the importance and potential complexity of the issues surrounding commercial real estate, it's almost always recommended that, before engaging in any real estate deal, you seek the counsel of a good Elburn, Illinois real estate attorney.