Contracts

What is 'closing condition' in a Hawaii commercial real estate purchase agreement?

AA. The condition of the property's physical structure at closing
BB. Conditions that must be satisfied before closing is required to occur; includes clean title, lender funding, estoppel certificates, regulatory approvals, and other transaction-specific requirements✓ Correct
CC. The market condition at the time of closing (buyer's or seller's market)
DD. A clause requiring the property to be vacant at closing

Explanation

Closing conditions in commercial purchase agreements are contractually required conditions that must be satisfied before either party is obligated to close. Common conditions: title insurance commitment received, lender has provided funding commitment, all tenant estoppel certificates received, required governmental approvals obtained, and due diligence satisfactorily completed. If conditions fail, the party they protect may refuse to close.

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