Buying Commercial Real Estate in Jamaica

Real estate in Jamaica is not only an attractive investment opportunity for those who wish to purchase an affordable vacation home, but the growing economy is enabling strong investments in commercial properties as well. To enjoy the benefits of investing in commercial real estate in Jamaica, there are certain regulatory requirements that must be met. Working with an experienced legal team can provide important safeguards and guidance to protect companies from potential liabilities.

Valuation and Expectations

The type of commercial property being purchased and its intended use are essential for determining the areas on which to focus during the due diligence process. Once identifying the ideal property, the legal team may help review property documents, conduct a title search, and ensure that the property is in compliance with local zoning regulations. A professional property inspector will determine if the property needs repairs and is suitable for use. An inspection will also give a better understanding of the true value of the property. For example, if the property is initially listed at market value, extensive repairs or complications with zoning may reduce the property valuation. 

A team of experienced local attorneys would be most familiar with the market will assist with the valuation negotiation process. Although a real estate agent may be helpful in finding properties that meet the appropriate investment criteria, a legal team is best suited for negotiating the best possible price for the property and required for the final purchase. After the property owner accepts an offer, an attorney can negotiate the terms of the sale, which include the final price, closing date, and any possible contingencies that must be met before the closing date.

Financing and Payment

Once an agreement is made, the final payment must be secured. If the full funds for the property sale are available through liquid assets, it is possible to purchase the property outright without the involvement of a financing institution or bank. This will yield the most efficient closing timeframe but is not usually required.

The majority of real estate transactions involve the assistance of banks or private financing institutions. Most banks in Jamaica offer loans that specifically cater to commercial real estate purchases. As with loans in the U.S. and EU, banks in Jamaica may require collateral or a down payment that constitutes a significant portion of the total amount of the loan. Once approved, the funds can be dispersed after documents are signed at closing. 

For those who seek to own commercial property with two or more parties, it is possible to jointly pay for the total cost, equally or by previously agreed-upon percentages. These are known as joint ventures and it is always advisable to seek the advice of an attorney before signing closing documents. Purchasing a property in this manner could lead many possible liabilities, which an experienced attorney is capable of preventing through separate negotiations and contracts. 

Closing

The most exciting part of the process is closing the sale. The new property can open businesses up to exciting new possibilities in the robust Caribbean market. The attorney will assist with closing the sale by reviewing all documentation, allowing the purchaser to sign the paperwork and complete the transfer of ownership. 

For a smooth transaction, it is important to work with experienced attorneys that can both assist with the negotiations and help clients avoid any foreseeable liabilities before closing. If you or  your company are interested in purchasing commercial property in Jamaica, contact Ramsay & Partners by calling (876) 906-2616 to schedule a consultation.