Government Approval for My Commercial Property

One of the key roles of local government is approving what people build on their land. From zoning to permitting and inspections, a local government can be a great partner or your worst enemy.

For just about any type of commercial project an investor wants to undertake, government action will be required.

Time and again, investors in commercial properties can find themselves in protracted battles with the government without the proper due diligence on what will be needed to accomplish the investors’ desires.

You do not want to invest significant amounts of money or sign a binding contract without understanding everything that will need to be done with the property.

To be prepared, you need to work with an attorney who understands all the issues that come with land use and permitting to give you all of the facts and possible scenarios you need to know before investing in any commercial real estate.

Check the zoning!

At the heart of any government approval is understanding what the government will allow on a particular property. Every parcel in the United States is zoned for something, a church, a single-family home, a warehouse or more.

In many cases, the zoning is not obvious. For instance, most people have driven by a piece of land with one or two cows on the property. Around the land on adjacent properties are hotels and shopping centers in this case.

The land with the cows may be very attractive to purchase for a commercial real estate investor, but the investor must understand the government will need to approve a zoning change from agricultural to a designation that allows them to build what they want.

That change will usually be smooth – after all, a new shopping center will provide significantly more tax revenue for the government than a cow pasture. Plus, because all the adjacent properties are commercial, there are relatively few detractors.

Still, there are multiple boards to approve the change and the investor will still have plenty of preliminary work to do on the legal and engineering needs of the process.

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