Certificate of Occupancy Challenges


Certificate of Occupancy Challenges

Mistake 2- Certificate of Occupancy

Assuming that a property will qualify for a Certificate of Occupancy just because there is or was a tenant in the space before you.

We are all familiar with the "Grandfather clause" where someone would allow you to get by with something that was out of compliance because it was a pre-existing condition.  However, due to health and safety issues, City building departments have implemented a "Change of Use" clause, requiring a new buyer or tenant to update everything that may be out of compliance.

Additionally, if the property use is changing from one business type to another, there may be different code or zoning requirements for your business that may require you to make modifications to the property to accommodate your type of business.

If there are changes required, these are costs you will want to discover early so that you can negotiate them with the owner.

So, before offering a Letter of Intent, and definitely before signing a contract, it would be wise to have a trusted Commercial General Contractor walk the space with you to discuss a number of things, such as:

  1. Your business and how you serve your clientele, to asses zoning and code compliance
  2. Check to see if there are any visible code or zoning issues
  3. Discuss obvious changes needed to meet your needs

Remember, anything you and your GC uncover might be used to negotiate more favorable terms.

I hope you have found this helpful.  Please pass this along to anyone who might benefit and remember to check out our other videos.