You know how you can smell the familiar scents of the changing seasons in the air ? Well those of us who have the honor to have survived a career in the real estate industry have recognized the smell in the air for some time. Right now that smell is pretty offensive; but we know from experience that it is going to turn sweet before you know it ! Recently, I was speaking with Mark Sinkhorn of Lawyer’s Title Insurance Company National Services Division in Columbus, Ohio who reminded me that back in 1980 when the economy was experiencing record inflation and the only transactions we were doing were land contracts; and more recently in 1987 and 1994 there was a similar collapse in the lending market. In all instances, the economy and real estate industry rebounded .

Today, other than for some condominium developments in larger markets, the commercial real estate market is not over-built and once credit frees up again commercial development should lead the way as businesses expand their operations. In the mean time, manufacturing and distribution operators might wish to consider sale-leaseback transactions as an alternative to creating cash and moving assets from on balance sheets to off balance sheets. Sale-leaseback transactions properly structured are a "win-win" for both the developer (buyer/landlord) and the company (seller/tenant).  Residential sellers might consider loan assumptions, seller purchase money mortgages and land contracts once again as tools to move their properties. There is a lot of room for creativity in commercial and residential property transactions, but care should be taken in the structuring of the same.

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Brad Kaplan

Brad assists Owners, Operators and Receivers of Hotel, Office and Industrial properties with their Real Estate, Finance, Leasing, Construction and Organizational challenges; specifically, negotiating and drafting hospitality, purchase, sale, financing, leasing, construction, franchise and management agreements. He has in the past and presently…

Brad assists Owners, Operators and Receivers of Hotel, Office and Industrial properties with their Real Estate, Finance, Leasing, Construction and Organizational challenges; specifically, negotiating and drafting hospitality, purchase, sale, financing, leasing, construction, franchise and management agreements. He has in the past and presently serves as general counsel and national real estate counsel to several domestic and internationally based public and privately held companies. Brad represents foreign businesses doing business in the United States and U.S. businesses doing business abroad; and is a former Chairman of World Services Group (www.worldservicesgroup.com) an international consortium of legal and other professionals. Brad has achieved the highest rating, AV Preeminent®, from Martindale-Hubbell®. He is an active member of the Illinois Bar and maintains an office in both the firm’s Cincinnati and Chicago offices. Brad is the editor of the Real Estate Advisor Law blog, a tool that highlights articles and observations of Ulmer & Berne attorneys on various trends and opportunities affecting the commercial real estate and construction industry, and is a frequent speaker on internet and social media issues.