Contracts, regulations, compliance, entity structures, zoning, permits, and landlord-tenant law.
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Foundation terms you need to know first (89 terms)
Development costs are all the expenses incurred during the process of acquiring land, designing, constructing, and preparing a real estate project for use or sale, from start to finish.
Base rent is the fixed, minimum rent amount paid by a tenant to a landlord for the use of a property, excluding additional charges like operating expenses, taxes, or utilities.
An absolute auction is a type of real estate auction where the property is sold to the highest bidder, regardless of the price, with no minimum bid or reserve price set by the seller.
The Lease Commencement Date is the official date specified in a lease agreement when the tenant's rights and obligations, including rent payments and property responsibilities, legally begin.
An application fee is a non-refundable charge paid by a prospective tenant to a landlord or property manager to cover the costs associated with processing a rental application, including background and credit checks.
Complex strategies and professional concepts (117 terms)
An Equity-for-Property Swap is an advanced real estate investment strategy where an investor exchanges equity in one or more properties or entities for direct ownership of another property, often to achieve tax deferral, portfolio restructuring, or strategic asset acquisition.
The accounting process of recognizing the estimated cost of an Asset Retirement Obligation (ARO) as a liability and capitalizing a corresponding asset, which is then depreciated over its useful life, reflecting the future costs associated with retiring a long-lived asset.
A legally binding contract that alters the priority of liens on a property, allowing a senior lienholder to voluntarily place their claim in a junior position to another, typically to facilitate new financing or complex transactions.
Unrelated Business Income Tax (UBIT) is a tax levied on the net income of a tax-exempt organization, including certain real estate investment vehicles, derived from a trade or business regularly carried on and not substantially related to its exempt purpose.
Inverse condemnation is a legal action initiated by a private property owner against a government entity to recover "just compensation" for a taking of their property, where the government has not formally exercised its power of eminent domain but has effectively deprived the owner of beneficial use or value.
Seller concessions are contributions made by the seller towards the buyer's closing costs, reducing the amount of cash the buyer needs to bring to the closing table. These are negotiated as part of the purchase agreement and are subject to lender-imposed limits.
A Seller's Agent, also known as a Listing Agent, is a real estate professional who represents the property owner in a real estate transaction, working to sell their home or investment property for the best possible price and terms.
A senior lien is a legal claim on a property that holds the highest priority for repayment in the event of a foreclosure or liquidation, ensuring its holder is paid before any other creditors.
A Series LLC is a legal entity structure allowing for multiple, distinct "series" within a single LLC, each with segregated assets and liabilities, offering enhanced asset protection and administrative efficiency for multi-asset portfolios.
A service agreement is a legally binding contract between two or more parties, typically a service provider and a client, outlining the terms and conditions of services to be performed in a real estate transaction or property management.
A servient estate is a parcel of land that is burdened by an easement, meaning it must allow another property owner (the dominant estate) to use a portion of it for a specific purpose.
A settlor is the individual who creates a trust, transferring assets such as real estate into it and defining the terms for how those assets will be managed and distributed for the benefit of others.
Severance damages are compensation awarded to a property owner when only a portion of their land is taken by eminent domain, and the remaining property suffers a reduction in value as a direct result of that partial taking.
A Shareholder Agreement is a legally binding contract among the shareholders of a corporation, outlining their rights, responsibilities, and obligations, particularly concerning company operations, share transfers, and dispute resolution.
A Sheriff's Deed is a legal document that transfers ownership of real property after a court-ordered public sale, typically due to foreclosure or judgment enforcement, offering no title warranties to the buyer.
A sheriff's sale is a public auction of property, typically real estate, conducted by a sheriff's department to satisfy a court judgment, such as a mortgage foreclosure or unpaid taxes.
A real estate transaction where the lender agrees to accept a mortgage payoff amount less than what is owed, typically to avoid foreclosure and mitigate losses.
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