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Recent Blog Posts
Residential Evictions or Forcible Detainer Suits
By agreeing to rent property from a landlord, a tenant enters into a lease arrangement with that person. From a security perspective, it is preferable to establish such a agreement in writing, and a large number of landlord-tenant agreements are completed as such. However, the state of Illinois also recognizes verbal leases, which are much more informal, and are normally considered month-to-month arrangements for a unspecified period of time. Violations of written or verbal lease agreements can force a landlord to pursue eviction action against a tenant, and properly doing so often involves several steps.
Notice Requirements
Before moving forward with eviction, a landlord in Illinois is required to notify the affected tenant in writing. The amount of notice given is dependent on the situation and the violated terms of the lease propagating the eviction:
Wealthy Investors Take the Lead in Housing Market Recovery
Sales of investment and vacation homes surged last year, the latest evidence that investors and higher-income households are taking advantage of low home prices to scoop up bargains.
In its annual survey of investment- and vacation-home sales, the National Association of Realtors found that the number of homes purchased by investors rose 65% during 2011 to 1.2 million, accounting for 27% of all home sales. In 2010, investment properties accounted for 17% of all sales.
The number of homes purchased as second or vacation homes jumped 7% last year to 502,000—accounting for 11% of all transactions, up from 10% of all sales in 2010.
While the majority of homes sold last year went to traditional buyers who plan to use the home as a primary residence, their presence in the market declined to 61% from 73% in 2010.
During the housing boom, speculators were blamed for helping to inflate the bubble by snapping up homes, especially new homes, and then quickly reselling them as prices rose higher. That led to overbuilding. Some economists now believe that investors are helping to stabilize the market by buying up excess inventory.
What Protections Does Title Insurance Give Commercial Real Estate Investors?
Title insurance is part of virtually every commercial and residential real estate transaction. Usually, it is the lender that insists on the formalities of title insurance. However, title insurance can give commercial real estate investors a great of protection, even if nothing ever goes wrong.
What Title Insurance Does
Before a title insurance policy is issued, the title company does a thorough examination of the title history of a property. This will include not just any sales, but also any liens on the property. Title insurance protects policyholders from any defects that are not discovered during the title search. If a defect later arises, title insurance covers the cost of defending claims from rival titleholders and pays out damages should those rivals prevail in court.
The issuance of title insurance is a key part of the due diligence process. Commercial real estate investors are able to make sure the property is as the seller claims. Any problems with zoning, title, or liens are usually discovered during the title search. If any issues arise, investors can either pull out of a deal without risking further resources or work with the seller to find satisfactory solutions.
What You Need to Know About 1031 Property Exchanges
Section 1031 of the Internal Revenue Code is one of the most powerful tools in the real estate investor's arsenal when looking to delay paying taxes. This section allows you to defer the payment of capital gains taxes or greatly reduce your tax liability. Section 1031 creates the ability for the creation of a “like-kind exchange”. You can either have a forward or a reverse exchange. This tactic only works for investment property and not for your personal home in most situations.
Forward Exchanges
In a forward 1031 exchange, you sell (or relinquish) your investment property and then within 180 days you close on a second property and use the proceeds from the sale to purchase the second property. If executed properly, the exchange will result in you not having to pay the capital gains on the proceeds from the first sale until you later completely cash out.
What You Need to Know About Construction Defect Litigation
Few things are more frustrating than finding that your home or building was built with some type of defect. These defects may not be discovered for years down the road after any warranties have long expired. Sometimes even your commercial general liability (CGL) insurance will not help you recoup the costs to fix the construction defect.
Why Your Insurance May Not Cover You for Construction Defects
The way Illinois courts have interpreted CGL coverage issues differs significantly from many other states. Most CGL insurance policies state that coverage does not kick in until there has been an occurrence. Illinois courts have interpreted occurrence to exclude defects introduced during the construction process because those acts were intentional and not accidental as the case with other types of covered occurrences.
This leaves many owners of defective buildings unable to collect from their CGL policies for the defects. Sometimes their only option is to sue the general contractor or subcontractor.
Structuring a Business Sale: Asset Sale Versus Stock Purchase Agreement
When selling or buying a business, a number of factors must be considered, namely how the transaction will be structured. Essentially, there are two primary options: asset value and stock purchase agreement. Understanding the benefits and potential shortcomings of each can help to ensure the best outcome for both buyers and sellers.
Asset Sales
Commonly referred to as cash-free, debt-free transactions, asset business sales do not typically involve the transfer of cash or long-term debts. Instead, company assets and liabilities are sold. Examples include equipment, leaseholds, trade names, licenses. Networking capital, such as inventory, accounts receivable, and accrued expenses are also often included in asset sales.
Buyers may experience some tax benefits, including the ability to “step-up” the company's depreciable basis in its assets. This can reduce their tax responsibility and improve cash flow during the vital first years. It can also provide buyers with some protection from potential liabilities, like contract disputes, product warranty issues, employee lawsuits, or product liabilities. However, certain assets, such as intellectual property, permits, leases, and contracts, may be more difficult to transfer.
Sale-Leaseback Transactions in Commercial Real Estate
Still in the process of recovering from the economic recession, American businesses continue to face a tough credit market that can hinder their ability to expand or stay afloat. Many have turned to sale-leaseback transactions to remedy these issues; commercial real estate investors have been more than willing to oblige. However, there are some important considerations that must be made by both parties before entering into such an agreement.
What is a Sale-Leaseback Transaction and How Does it Work?
In essence, sale-leasebacks are arrangements in which a company sells their property to a third party investor and then leases it from the buyer so they can continue to use it for their business. The seller/lessee receives capital gain that can be used to reinvest in the business or pay off debts while the buyer receives ownership of the property with often better profits, stability, and legal options than they might have received through traditional leasing.
Planned Unit Developments for Commercial and Residential Real Estate
While any type of development can be complicated, the planned unit development (PUD) process often far exceeds the regulatory hurdles of other types of development. If an application is not completed properly or the regulatory process is not monitored, it can cost developers thousands of dollars, or potentially jeopardize the project altogether.
What Are Planned Unit Developments?
In Illinois, cities have the authority to allow for planned unit development (PUD). This is a special regulatory process to allow for the construction of large residential or commercial development projects. Each city has its own application process. Each city also has its own preferences and concerns that can affect how easily it is to get a project approved and built.
Unlike regular zoning laws that are fixed to parcels on a map, a PUD is known as a floating overlay district. It allows communities and developers to meet community needs and concerns such as population density and the revitalization of communities without worrying about the specific zoning districts. Instead, once the PUD is approved, the PUD zoning regulations are overlaid on top of existing zoning rules.
Conditional Use Permits: What You Need to Know About Obtaining Permits in Residential and Commercial Real Estate Projects
Illinois city zoning and land use laws and regulations are complicated. Navigating through the red tape of the permit process takes more than just a keen attention to the details of the language of the building code. It also takes an understanding of the personalities and processes involved in the planning process. If your commercial or residential real estate project needs a variance from zoning laws, you will need to secure a conditional or special use permit.
Condition Use Permit Process Overview
Each city has its own process for deciding on conditional use and special use permits. The legal process is usually described in the city's zoning and building code and ordinances. But, the laws only describe the formal process. There are some important informal steps that will help you make sure you get the permit you need for your project.
The essential steps for getting a conditional use permit include:
Real Estate Development: Top Strategies Employed by Savvy Investors
Even though the U.S. is well on its way to recovering from the recession, there are still investors who fail in the real estate development market. In contrast, there are those who consistently make money, despite any changes or fluctuations. The following strategies, employed by the savviest of investors, are often key in giving the latter their edge over the former.
Study and Know Local Pricing
Studying and knowing your local market is an invaluable strategy in real estate development and investment. Not only do you learn which prices are fair (which can assist in finding the best prices), you are also able to better stay ahead of the trends. Take, for example, an area in which home sales are accelerating at a faster rate than its neighboring towns or subdivisions; this can tip you off to areas that are currently in high demand.
Know How to Spot a Catalyst
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630-778-3818
