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Texas a top state for foreign investors in commercial real estate

According to a recent survey, roughly half of the members of the National Association of Realtors reported an increase in commercial real estate transactions involving investors from outside the U.S. in 2016. And Texas is one of the top three markets for foreign investors.

According to the survey, foreign buyers are snapping up specific types of commercial space in places like Texas and Florida, including relatively modest transactions valued at around $2.5 million.

Most of the buyers come from China, followed by Mexico, the United Kingdom and Venezuela; foreign sellers mostly originate from China, Brazil, Canada and France.

The survey also examined leasing trends involving foreign parties. According to the report, about one-quarter of the members surveyed reported completing lease agreements involving a client from outside the U.S. The average lease transaction was $105,000 for space smaller than 2,500 square feet.

This trend -- which economists expect to continue through 2017 -- can affect Texas business owners, residents and developers in a number of different ways. To begin with, it adds yet another layer of complexity to already dicey scenarios. If your neighbor, tenant or landlord is actually in China or another country, resolving payment, construction, land use or other issues with that party can be very difficult.

Further, it can present a competitive challenge between foreign parties and local buyers. Oftentimes, foreign investors are able to pay in cash, giving them the edge in many negotiations.

Considering how intricate these transactions can be, it would be wise for anyone involved in the buying, selling or leasing of commercial property in Texas to consult an attorney before agreeing to anything.

Whether the other party involved in a commercial real estate issue is in China or here in Houston, there can be a lot on the line if confusion or a dispute arises. In these situations, legal guidance can be critical in protecting your business and your bottom line.

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