The closing process for residential and commercial transactions in Florida differs in several key ways. While the end result is the same for both processes –  the successful transfer of property ownership – the road to get there is much more complex in commercial transactions. Here’s a breakdown of some of the main differences.

Key Differences Between Residential and Commercial Real Estate Closings

The most obvious difference between residential and commercial real estate closings is the property type and how it will be used. Residential real estate transactions involve the purchase or sale of properties primarily intended for personal or family use, such as single-family homes, condominiums and townhouses. 

Commercial real estate transactions, on the other hand, involve properties primarily used for business or investment purposes. This includes properties like office buildings, retail spaces, industrial warehouses, apartment buildings, hotels and land zoned for commercial development. 

Here are some additional differences that make the closing process more complex for commercial properties.

  • Parties involved – One reason commercial transactions are generally more complex than residential closings is that there are more parties involved, and all parties must agree to the terms of the deal.
  • Contractual aspects – Residential real estate transactions typically lean on standardized contracts and forms. Conversely, commercial closings often involve more customized contracts tailored to the specific needs and complexities of the deal. These purchase and sale agreements must be carefully drafted and negotiated by a skilled attorney prior to closing.
  • Financing – Residential real estate buyers often rely on conventional mortgage financing from banks or other lending institutions to finance their purchases, whereas commercial investors may seek a broader range of financing options.

Overall, while both residential and commercial real estate closings involve the transfer of property ownership, commercial real estate transactions tend to be more complex. If you have questions about commercial real estate transactions in Florida or would like to schedule a consultation, please get in touch with our team at the Law Offices of Alex D. Sirulnik, P.A. and ADS Title Services, Inc. for help.