RE60RC10: Commercial Real Estate Transactions

A Description of Commercial Transactions
  1. Introduction and Agenda ( 15 mins)

a. Bundle of Rights (use, enjoy, control, dispose) as a way to understand the rights and obligations that are conveyed to others

b. Contractual nature of commercial real estate due to size of investments

c. Legal requirements for commercial real estate transactions and contracts in Massachusetts

d. Recording and other public notices

e. Types of commercial real estate contracts

2. Licenses for Commercial Users (10 mins)

a. Temporary right to use property for a specific commercial purpose

b. Revocability

c. Examples of licenses

d. Insurance, hold harmless and other risk considerations in licenses

3. Easements for commercial users (15 mins)

a. Permanent or long term nature

b. Specific rights conveyed

c. Types and applications

d. Removing or modifying easements

4. Commercial Leases (10 mins)

a. Longer term conveyance of specific real estate rights

b. Key terms and conditions

c. Tenant and landlord responsibilities

d. Lender interest in a lease

e. Validity of leases in bankruptcy

5. Commercial Sale Leasebacks (15 mins)

a. Transaction motivations, structuring and timing

b. Key terms and conditions

c. Accounting considerations

d. Synthetic Leases

e. Buy back options

6. Commercial Ground Leases (15 mins)

a. Ground lease versus property sale

b. Key terms and conditions

c. Rent setting and adjustment

d. Reversion of improvements at end of term

e. Mortgage considerations

f. Valuation of ground lease interests

7. Purchase and Sale Commercial Agreements (20 mins)

a. Commercial Buyer and Seller perspectives

b. Commercial real estate due diligence considerations

c. Timing, contingencies and options

d. Allocation of costs

e. Adjustments to price

f. Requirements, obligations and closing

8. Tax-Deferred and Tax-Free Exchanges (10 mins)

a. Tax considerations of real estate sales

b. Types of exchanges

c. Rules, structure and timing

d. Intermediaries and Exchange Accommodators, receipt of proceeds

e. Re-investment of obligations

9. Installment Commercial Sales (10 mins)

a. Use of installment sales

b. Tax considerations and recognized gain

c. Purchase money mortgages

d. Elections

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