What should small business owners know before buying commercial real estate?

An occupied purchase is a different question from an investment purchase because the business and the building are one account. The investor spreads risk across tenants; the owner-occupier carries the whole thing once, and a slow season hits the building and the business at the same time. The logic holds when the location is the one the business needs and the number is one the business can carry.

The financing comes off a commercial menu, not the residential table. The SBA owner-user programs, such as the 7(a) and the 504, and the commercial loans of local banks each have their own uses, down payments and terms. Lenders underwrite the business, the owners' credit and the property all together, which is why the lender conversation comes early, long before the offer.

The due diligence is heavier and less forgiving than a home inspection. The title, the survey, the environmental review, the structure and systems, the zoning and permits: each report has its own cost and schedule, and the closing date is set around them, not around a hope. Several take weeks, and the findings have a way of rewriting the price.

Representation is the hinge. The listing agent serves the seller by default, and Georgia's brokerage law holds that an engagement exists only if it is written. A buyer who wants an agent working for them gets it down in writing before the negotiation starts; without that, the buyer is a customer of the listing brokerage, and the seller's agent owes the seller the deal.

Georgia is clear that a real estate agent's relationship with a buyer or seller of commercial or residential property exists only when it is put in writing. The small business owner who expects the agent showing them the building to be on their side gets the expectation put on paper, before confidential numbers are shared.

Georgia closes real estate through an attorney, and commercial sales follow the same track: the title work, the settlement, the payoffs and the recording handled by the closing attorneys. Commercial deals add their own layers, from leases to lender consents and guarantees, so the attorney's review of the contract is scheduled early, not at the end.

The county and the city decide what the property may be used for. Zoning districts, the certificate of occupancy and the permit history are all in the local record, so the intended use, retail, office, warehouse, is either lawful and approved or a separate project. The planning office will tell you, and the answer is needed before the contract, not after.

Start with the business plan, not the listing search. The location, the size and the parking have to serve the business first; the building that serves it will show the way.

Map the full cost. Price, closing, taxes, insurance, maintenance, a reserve and the month of the move all belong in the number, and the mortgage is the loudest line, not the only one.

Commission the reports in the order the schedule needs: title, survey, environmental, structural, zoning. Each takes its own weeks, and nothing is worth closing over a report that was not ordered in time.

Write the representation down. The written engagement, the closing attorney and the business's own accountant are the team; the owner who negotiates a commercial contract without the three is working without a staff.