Buying Commercial Property In Today’s Economy: Top Tips For US CRE Investors

Learning how to buy commercial property in today’s uncertain economy can be a good way to snatch up quality properties for cheap. However, for that, you must have a good understanding of the commercial real estate law.

The high interest rate environment that prevailed post-COVID-19 drained liquidity from the CRE market as investors stayed on the sidelines. 

It looked like the tides were going to change when the Federal Reserve cut interest rates twice in 2024. However, fiscal uncertainties resulting from the new Trump administration led the Fed to pause interest rate cuts in its January 2025 meeting.

Yet commercial properties have started appreciating due to higher demand and high occupancy rates. More fundamentally, the CRE market has been historically known for its ability to provide strong gains even during times of economic uncertainty and downturn. 

Therefore, instead of sitting out the market, you should consider the best way to profit from it. But how can you do that?

Hi. In today’s blog, this is what I will be talking about. So, if you want to know what are some of the things that you can do to profit from this resilient market, keep on reading till the end…

Understanding the Commercial Real Estate Law in the United States

As we all know, the commercial real estate law governs the legalities that are related to the commercial properties. Unlike personal residential properties, these include real estate for business purposes.

But what does it revolve around? Well, to put it simply, these laws are about property ownership for business and commercial purposes.

Additionally, these laws also outline the rules and regulations that you have to adhere to when it comes to the use and sale of such properties.

So, if you are planning to create that contract or indulge in the lease of a commercial property. These are also under the commercial real estate law.

Tips For US CRE Investors Dealing With Commercial Real Estate Law

Now that you know what commercial real estate law is about, here are some of the tips that you should keep in mind if you are a CRE investor:

Select the Right Properties

Though a CRE recovery has begun, it is not yet widespread. Office spaces continue to be underutilized despite the growing calls for employees to return to the office. Also, retail continues to struggle as the rise of e-commerce reduces demand for retail spaces. 

On the other hand, high homeownership costs make multifamily CRE attractive. Warehouses are also benefitting from the growth in e-commerce. 

Furthermore, non-traditional CRE sectors like data centers, film studios, and co-working spaces are experiencing rising demand. 

The main takeaway here is that you should focus on sectors where demand is high, the vacancy rate is low, and the occupancy rate is high and avoid being too cautious to explore non-traditional sectors. 

Use a Qualified Agent

A good real estate agent can make your life easy in many ways. 

First, they can help you identify opportunities that others cannot see. Given that they have a local presence, they can get wind of distressed properties, fixer-uppers, and off-plan properties with the potential for higher return on investment (ROI). 

Second, they can use their negotiating skills and knowledge of the local market to help you get better terms.  

Do Your Due Diligence

Is earnest money refundable? Yes, it is, provided that the reason you are backing out of the deal is part of the contingencies agreed upon in the purchase and sale agreement. 

Before signing the purchase and sale agreement, ensure you include contingencies that give you enough time to conduct due diligence. These include physical inspection, financial records, environmental, zoning, and appraisal contingencies. 

In other words, your due diligence must include ensuring that there are no undisclosed damages (physical inspection). It should also ensure that the property is truly profitable (financial records).

Additionally, you should also meet relevant environmental conditions (environmental) and zoning requirements and must continue to do so (zoning). Apart from that, you must ensure that the property is worth its purchase price (appraisal).  

Negotiate Purchase Agreements

In addition to including all the relevant contingencies, ensure that you negotiate the price and terms of the deal. 

As a CRE investor, you should have in mind the maximum amount you are willing to pay for a property (based on your return on investment expectations) and stick to it.  

Close Deals Quickly

In competitive markets, speed is essential. Whether it is securing EMD financing, conducting due diligence, or paying for the property, there should be a sense of urgency. 

However, speed should not be absolutized. When it comes to deciding if this is the right property to buy, you should take the time you need to crunch the numbers and evaluate other qualitative factors.

Have a Property Management Plan

As a CRE investor, every property you acquire should have a specific role to play in your overall portfolio. You should not buy a property just because it is the talk of the town or the subject of dinner conversations among real estate agents. 

Furthermore, you should have a plan for managing the properties in your portfolio. If you have the time, you can choose to do this on your own. Alternatively, you can employ a property manager who will handle all the tasks. 

Secure the Needed Financing

At the beginning of the deal, you will need to pay an earnest money deposit (EMD) so you can inspect the property and negotiate its purchase terms. If everything goes well, you will also need to secure funding to pay for the property.

Though there were two interest rate cuts in 2024, traditional lenders have not returned to pre-COVID-19 leniency with their lending requirements. Thus, you will need to look beyond traditional lenders to secure EMD as well as the purchase price of the property. 

Wrapping It Up!

Duckfund is a CRE financing company you can trust in this regard. They will provide you with quick EMD financing at the beginning of the deal. You can complete an EMD application in two minutes and get the money to an escrow within 48 hours. 

After you have secured the deal, they will also offer you both equity ($100 million) and debt financing (up to $500 million) to complete it. Duckfund offers financing for pre-development, development, redevelopment, and value-added commercial real estate projects.

Read Also:

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• Having a Real Estate Attorney Can Simplify Your Entire Property Process
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