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| Section | Objectives |
|---|---|
| Commercial Property Types | - Industrial Properties
|
| Property Development and Land Use | - Taxation and Regulatory Considerations
|
| Financial Analysis | - Commercial Financing
|
| Commercial Property Transactions | - Commercial Property Sales
|
1. A salesperson is drafting an offer and discussing with the buyer the steps required for due diligencewhen purchasing a commercial condominium unit. All of the steps below are included in due diligence, EXCEPT:
A) Identify third-party professionals
B) Estimate time frames required for due diligence and other offer conditions
C) Gather, organize, and verify all pertinent information
D) Create a business plan
2. While preparing to list a vacant retail site that allows new auto sales, the salesperson sees that there is an auto repair garage business next door with old and rusting metal storage tanks at the side of their building. Which of the following is the correct action for the salesperson to take?
A) The salesperson should ask the owner of the garage for more information and what course of action they recommend to assist a future purchaser of the site.
B) The salesperson should attempt to identify signs of contamination on the property and recommend an appropriate third-party expert to the seller client.
C) The salesperson should ask the owner of the garage whether they have thought about selling their property at this time.
D) The salesperson should include the information in the marketing material as it would be beneficial for an auto sales business to have a garage located nearby.
3. Different clauses can be used for each transaction to address the unique needs of buyers and sellers. Which of the following may be used in an agreement of purchase and sale to buy a commercial property?
A) A clause for the seller to disclose all information verbally without providing supporting documents to verify that information; documents to be provided on closing
B) A clause to confirm the remuneration payable to the brokerages will be as stated in the seller representation agreement
C) A clause for the buyer to review the leases only after all conditions have been waived and accepted
D) A clause for the buyer to have the right to negotiate for specialized restaurant equipment that is not included in the property purchase price
4. A buyer is purchasing a farm and all the animals are included in the sale price. The buyer is worried the animals could become infected with disease prior to closing, so the salesperson inserts a clause in the agreement of purchase and sale to address that issue. Which of the following should NOT be included in the clause to protect the buyer?
A) State that the buyer is assuming all animals on an "as is" basis.
B) The number of animals based on type, gender, and health; if the number is not the same at closing, the price will be adjusted.
C) State that the seller will continue the day-to-day farm operations until closing.
D) A condition requiring a check-up of each animal by a predetermined veterinarian during due diligence.
5. A salesperson negotiates the purchase of a retail property for their client, who plans to open a new store at this location. The client asks the salesperson how many parking spots the property will be required to have to meet the zoning requirements. The salesperson replies that the municipality has zoning requirements that set the minimum parking ratio. How will the municipality calculate the parking ratio?
A) The municipality will take the number of available parking spaces and divide it by the projected number of monthly visitors.
B) The municipality will take the number of available parking spaces and divide it by the property's gross leasable area.
C) The municipality will take the property's gross leasable area and divide it by the number of available parking spaces.
D) The municipality will take the number of available parking spaces and divide it by the property's net leasable area.
Solutions:
| Question # 1 Answer: D | Question # 2 Answer: B | Question # 3 Answer: D | Question # 4 Answer: A | Question # 5 Answer: C |
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