Real Estate/Development
Sep. 2, 2026
When 'substantial completion' is not enough: Purchase agreements for newly constructed buildings
Purchase agreements for buildings still under construction must precisely allocate the risk of delay--distinguishing between a building's readiness for use and its readiness for legal closing--to protect buyers with firm business deadlines and prevent disputes over what "ready" really means.
Jessica K. Lomakin
Partner
Best Best & Krieger LLP
Phone: (909) 989-8584
Email: Jessica.Lomakin@bbklaw.com
Purchase and sale agreements (PSA) for completed buildings are often difficult enough. Agreements for buildings still under construction add another layer entirely. The parties are not just negotiating price, title, due diligence, financing and closing mechanics. They are also negotiating who bears the risk that the building is not ready when the buyer needs it.
That risk becomes more complicated when the buyer has a business deadline. Equipment may be a...
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