At Davidzon Law we understand the complexity of commercial real estate transactions and never treat any deal as “routine”. We always advise our clients looking to purchase a commercial property to consult with us prior to negotiating any deal so that we may undertake a preliminary search of title to understand what type of encumbrances may be registered on title to the property. With this information our clients are in a better position to negotiate a deal in which they purchase a property with clear and marketable title.

Our title review includes reviewing all instruments registered on title to the subject property or affecting title to the property. We regularly review encumbrances such as:

• easement agreements;
• right-of-way agreements;
• restrictive covenants;
• site plan control agreements;
• development agreements;
• subdivision agreements;
• municipal by-laws;
• registered leases; and
• liens.

We will always review available surveys of the property and point out any concerns to our clients.

We will also review title to all adjacent properties to ensure that there are no issues or contraventions of the Ontario’s Planning Act which might come back to haunt our clients in the future. We will prepare a summary report of our findings for our clients and have a discussion with them so they understand how title to the property is affected by its registered encumbrances and how that may affect them as potential registered owners.

Further to our title searches, we conduct an exhaustive off-title search. Our off-title searches include inquiries with:

• the municipal tax department to ensure there are no unpaid realty taxes;
• the municipal water department to ensure there are no unpaid utilities;
• the municipal building department to ensure zoning compliance, that there are no outstanding work orders, that the property was never used as a waste disposal site, no open building permits and that there are no septic tanks on the property;
• Ontario’s Electrical Safety Authority to ensure there are no outstanding work orders;
• the local hydro company to ensure there are no unregistered hydro easements affecting the property or unpaid utilities;
• Ontario’s Hydro One to ensure there are no non-local unregistered hydro easements affecting the property;
• Ontario Conservation Authority to ensure the property is not located in a flood plane and that there are no outstanding work orders or breaches of any regulations;
• the local fire department to ensure there are no outstanding orders against the property;
• the municipal public health department (in the case of restaurants) to ensure there are no outstanding orders affecting the property;
• Ontario’s Technical Standards and Safety Authority to ensure there is no history of fuel oil spills or underground storage tanks, and to ensure any elevators on the property are compliant; and
• if relevant, inquiries to ensure compliance with heritage designation, Ontario’s Greenbelt Plan, Oak Ridges Morraine, Niagara Escarpment Commission, Airport Zoning.

We will always summarize the results of our inquiries and explain the findings to our clients so they understand how the subject property may be affected.

In situations where our clients are purchasing a commercial real estate property from a corporate vendor (which is normally the case) we will perform searches against the corporation which include:

• reviewing a corporate profile report;
• reviewing any Personal Property and Security Act (PPSA) registrations against the company to ensure that none affect the subject property and obtaining releases or comfort letters in the event that there are any registrations affecting the subject property;
• Federal and Provincial bankruptcy and insolvency searches to ensure the corporation has the right to sell the property;
• inquiries with the local land registry office and sheriff to ensure there are no judgments or executions against the corporation;
• on the day of closing reviewing a certificate of status to ensure the corporation is active at the time of sale; and
• on the day of closing confirming the corporation’s HST registration with the Canada Revenue Agency.

We have acted for many clients purchasing residential multiplexes, apartments, commercial plazas, and commercial office buildings. The common denominator in all these situations are that the properties are tenanted. In these situations we undertake thorough due diligence of all leases. We will review all current leases and summarize key terms to our clients in an easy-to-understand manner. We will prepare estoppel certificates to be executed by tenants to protect our clients’ interests. In the event that our clients are required to execute non-disturbance agreements with tenants we will review and negotiate these agreements to protect our clients’ interests.

Davidzon Law real estate law team are well versed in all aspects of commercial real estate law in Ontario and have years of experience acting on behalf of our clients to achieve their goals. We regularly work together with real estate agents and mortgage brokers to ensure that our clients complete their transactions with ease and without worry. We understand that our client’s livelihoods are tied into their commercial real estate holdings and we are proud to represent them. If you would like to discuss a commercial real estate purchase with a lawyer at Davidzon Law, please call us today to schedule a consultation.