Owning a piece of commercial real estate in Passaic, New Jersey can be a significant achievement. But while ROI on commercial real estate can be attractive, this type of investment (like any other) comes with its share of risks. And this underpins the importance of exercising due diligence when taking this investment route.
Whether you are a first-time investor or a seasoned one, here are two things you need to take into account when investing in commercial real estate in New Jersey.
Pay attention to zoning and land use
Every parcel of land in a municipality falls within a zoning district. And each zoning district has specific regulations that govern what can be done on the property built on it. For instance, a commercial property may not be built in a residential district.
Understanding the New Jersey zoning code can shield you from costly missteps that can ruin your commercial real estate investment goals. Besides closing the deal, it is important that you obtain crucial documentation relating to the property in question’s zoning. These may include applicable permits, licenses and any past violations.
Carry out a title search
Before inking that deal, take time to get a clear picture of the ownership of the commercial property you are interested in buying. You can only achieve this by conducting a title search. During the title search, be sure to look for the following:
- Whether the property has any title issues
- Whether the property has been used as collateral or if there is a lien on it
However insignificant they might be, title issues can complicate matters down the road. Do not leave anything to chance.
Protecting your rights
Commercial real estate investment comes with a myriad of financial and legal complexities. Learning more about New Jersey real estate laws can help you protect your rights and interests while investing in commercial real estate.