Commercial Acquisitions: 7 Title Checks Before Closing

Residential title work asks whether the seller can convey and whether the liens will clear. Commercial acquisition diligence asks a harder question: what will the buyer be able to do with this property, and what has someone already promised about it in an instrument nobody has read? The answer is almost never in a summary. It is in the documents the summary cites.

That distinction drives the checklist below. A commitment listing eleven exceptions by book and page is a table of contents; the diligence is reading all eleven. These checks extend the ground covered in our guides to attorney due diligence and commercial lease title review.

Why the document set is the deliverable

Two features of commercial property make paraphrase dangerous.

First, the encumbrances are operational rather than monetary. A reciprocal easement agreement in a retail center allocates parking, signage, access, and maintenance among owners who have to coexist for decades. A summary saying “REA recorded 1998” tells you nothing about whether your intended use is permitted.

Second, the instruments amend each other. A declaration from 1985 with four amendments, two assignments, and a consent recorded in 2011 has to be read as a stack, in order, and the stack is only visible from the recorded chain.

Third, the counterparties persist. A residential seller disappears at closing; a commercial buyer inherits neighbors, co-owners, and an association that will be exercising rights against the property for the next thirty years.

Seven checks on an acquisition file

1. Confirm vesting and authority in the record

Establish that the record owner is the contracting seller, and read the instruments that put them there. Entity conveyances raise authority questions the land record only partly answers, which is the same terrain as verifying property ownership.

2. Pull every exception document, without exception

Order copies of all of them and read them against the intended use. This is the step that gets compressed under deadline pressure and the step that generates the post-closing surprises.

3. Read the declarations and reciprocal easements as a stack

Original, then every amendment, in recording order. Watch for approval rights, exclusive use provisions, and restrictions on subdividing or changing use.

4. Map access, parking, and utilities to recorded rights

Confirm that access is by recorded easement or a public street rather than by long use, and that utility service crosses land where a recorded right exists. Rights that exist only in practice are precisely what a records search cannot confirm, and the boundary questions that follow are covered in our note on easement and boundary disputes.

5. Check restrictive covenants against the business plan

Use restrictions, exclusives running to an anchor tenant, height and setback limits, and reverter or right-of-reentry language all survive closing. Our guide to restrictive covenants covers how they read and how long they last.

6. Search for construction, litigation, and municipal filings

Mechanic’s liens with relation-back priority, a lis pendens clouding title, and recorded municipal agreements or violations belong in the same sweep. Recent construction deserves particular attention, as our note on mechanic’s lien priority explains.

7. Reconcile the rent roll against the recorded record

Recorded leases, memoranda, subordination agreements, and assignments of rents should be checked against what the seller represents. Unrecorded leases will not appear at all, which is why estoppels run on a parallel track to the search. Where a recorded memorandum exists, compare its stated term and options against the rent roll, because a discrepancy between the two is a question worth asking before closing rather than after.

One sequencing note runs through all seven. Order the search early enough that the exception documents arrive with time left to read them, and order an update close to closing. A report is accurate as of its own date, and commercial deals routinely run long enough for a lien or a lis pendens to appear in the gap.

What the search will not decide

• A title search reports what has been recorded in the county searched, as of the search date, with copies of the instruments found.
• It does not opine on whether the intended use complies with a recorded restriction, or whether an exclusive has been breached. Those are legal conclusions.
• It does not locate anything on the ground. Encroachments, parking counts, and whether the building sits inside its setbacks are survey questions.
• It does not reveal unrecorded leases, side letters, or oral arrangements, and an empty result reflects the record rather than proving none exist.
• It is not zoning or entitlement review, and recording and indexing practice varies county to county.

How AFX Research supports the file

AFX Research performs in-person searches, certified abstracts, and full document copies from any U.S. county — delivered in 12–72 hours and backed by our search guarantee. On an acquisition the useful deliverable is completeness: every recorded instrument affecting the parcel, in date order, with copies attached, so your read of the declarations and easements is based on the documents rather than an index abstract. We handle deed retrieval where the conveyance history has to be reconstructed, support property attorneys through diligence and any curative work, and can work to a diligence deadline if you send us the commitment and the exception list.

Order a title search with the recording dates and document copies your file needs, or compare our search products to match the scope to the matter.