When it comes to buying commercial real estate, the importance of assessing and managing environmental liabilities before purchasing should not be underestimated. Environmental liabilities can end up costing you hundreds of thousands, in some cases millions, of pounds in the future. For example, you could get sued by the environment agency if you fail to deal with current environmental hazards on the land that your commercial property is built on.
It’s important to conduct your own assessment of possible environmental liabilities and not just rely on the information stated on a real estate listing. You should ideally hire a professional assessor to conduct a full survey of the land before you even think about making an offer on a building. Environmental problems can cost a future to fix and in cases where they can’t be fixed, you could find yourself unable to develop on the land or even resell the land.
Some environmental problems that can cost a lot of money to deal with include the discovery of radioactive materials, contamination on the water table, subsiding land, rerouting of a river, problems with underground pipelines, pest invasions, poisonous vegetation overgrowth and more. There are many possible environmental liabilities that could become a problem for real estate investors. Many of them you won’t even be able to imagine unless you start researching or are unfortunate enough to encounter them yourself. Therefore, seeking professional advice is essential.
There are also many other things you need to take into consideration before you purchase any types of commercial properties. If you are planning on investing a large sum of money, you should ensure you hire a team of lawyers to go through the contracts and purchase agreement documents. Never try to negotiate a commercial real estate deal by yourself unless you have an extensive legal background. There are many loopholes that can be difficult to spot and you need an ironclad agreement when millions of pounds are involved.
Even if you are just planning to invest in a relatively small commercial development, you should always speak to a lawyer and/or an environmental consultant. You could also take a look at http://www.argyllenvironmental.co.uk/environmental-due-diligence where you will find some excellent information. In addition, you need to ensure that you have all of your financing sorted out before you make an offer. How are you planning to fund your purchase? A commercial bank loan or mortgage? Private investor contributions? Crowd funding? You need to get your finances in order to avoid stressful problems and legal complications in the future.