Are Sellers Required to Disclose Commercial Property Defects?

Before a buyer purchases a commercial real estate property, it is important that they are made aware of material property defects or issues relating to the property. Many buyers have suffered significant financial loss after discovering various defects after the purchase of the property was finalized.

There are many defects and issues with a property that a seller may misrepresent or intentionally conceal. Some of the most common commercial real estate issues that may arise include:

  • Unfinished construction projects, for which contractors have not been paid.
  • Environmental issues (e.g. oil leaks)
  • Property defects (e.g. leaky roof)
  • Title defects (e.g. liens on the property)
  • Termite damage
  • Flooding history
  • Local ordinances (e.g. zoning requirements, restrictions) that affect the operation of the business

Are Commercial Sellers Obligated to Disclose Property Defects?

It is important to keep in mind that the mere failure to disclose a material fact about the property may not warrant a legal claim, as sellers of commercial real estate have no duty to disclose under Florida law. As long as the seller does not intentionally conceal the problem or only partially disclose the problem, and the buyer has an equal opportunity to learn about the defect, the seller may not be sued for breaching their duty to disclose.

However, sellers who make material misrepresentations regarding the property or actively conceal defects may find themselves facing a lawsuit once the purchase has been finalized and the new property owner discovers some of these defects.

A commercial real estate attorney in your area can help you determine if you have a legitimate non-disclosure claim against the seller who sold you your commercial property.


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