Updated February 16, 2021
If you’re looking for a sample template for a Letter of Intent to Purchase Commercial Real Estate in PDF or MS Word format, we’ve got your back!
In a commercial real estate purchase, the Letter of Intent (“LOI”) serves as a negotiating device that outlines all of the terms the Buyer & Seller have agreed to before entering into a Purchase & Sale Agreement contract.
Once you’ve found a commercial property for sale that you are interested in purchasing, you will to draft a proposal (also known as: a Letter of Intent) To Purchase Commercial Real estate to start the negotiation process.
As mentioned earlier, the Letter of Intent is designed to outline all the key terms a Buyer or a Seller desires to obtain in the transaction.
If you don’t see a key term you want to negotiate in the LOI template, just add it. More about this later.
LOIs are living things that change depending on the situation of your purchase.
For example, A standard LOI outlines the purchase price, the length of the escrow, the due diligence period, deposit amounts, etc.
But let’s say that you want the Seller to replace the roof before the close of escrow; well, then add that section and outline exactly what you want the seller to do before the close of escrow.
You can download the Sample Letter of Intent (PDF or Microsoft Word Format) by clicking here or the button at the bottom of this post.
In the Letter of Intent, you need to include the names of the parties negotiating.
For example, the name of the Buyer & Seller, and a list of industry standard list items.
Most Industry standard things to include in the Letter of Intent To Purchase Commercial Real Estate are:
- Name of the parties in the transaction (ie. Name of Buyer or Buying Entity trying to purchase the commercial property – and the Name of Seller)
- A expiration date for the LOI. (a good rule of thumb is to make Letters of Intent last no more than 5 business days)
- Wording that explicitly mentions that the LOI is a “non-binding” agreement, and that it is simply to be used for negotiating the terms of the purchase, not a contract
- If you have a special type of business use, and require a Conditional Use Permit (“CUP”), make sure you add that to the terms of your transaction make sure that you state that the purchase is subject to you getting approval from the City for your specified use.
- Full Address (and unit size in case of a condo) of the property you intend to purchase
- The purchase price
- The square foot size of the property (you may also want to request that the price be adjusted if the square footage of the property is found to be smaller during the due-diligence process.
- The length of escrow
- The length of the due-diligence period
- Who the brokers involved are
In the Sample Letter of Intent To purchase Commercial Real Estate you download below, you will see many of these terms included. You can adjust them as you see fit.