Business-Minded Legal Solutions

Realtor group: Texas a hotspot for foreign investment in commercial real estate

One of the trends in commercial real estate readers may have heard about in recent years is that foreign buying of U.S. real estate is on the increase. According to a recent survey published by the National Association of Realtors, 20 percent of its commercial real estate members reported having closed at least one sale with a foreign buyer in 2016.

The survey also found that the state of Texas, along with Florida and California, was among the most popular markets for foreign buyers of commercial real estate. There are probably multiple reasons for this, one of which is that slow but steady economic improvement makes the U.S. market in general, and the Texas market in particular, favorable for foreign investors.  

Working with experienced professionals, including a knowledgeable real estate attorney, is important in any commercial real estate transaction. This is especially true of transactions with international buyers involving a lot of money. Although many of the rules are the same for foreign buyers as for domestic transactions, additional complexities can arise with transactions involving foreign buyers.

For one thing, negotiation styles can vary more with foreign buyers due to differences in cultural practices and expectations. Some buyers, for example, may try to negotiate up until closing while other may attempt little or no negotiation.

Foreign real estate transactions are also more likely to involve nonstandard purchase agreements. Such agreements may not have the typical provisions of standard contracts or may have provisions which aren’t common in standard contracts. For instance, a buyer may need time to travel overseas to be at closing, or may need accommodation for the processing of a foreign mortgage application, transfer of currency overseas, or may request for more time to benefit from favorable currency conversion rates.

In our next post, we’ll continue looking at this issue, and the role an experienced attorney can play in commercial real estate transactions involving foreign buyers.


Dallas News, “Florida, Texas top foreign buyers property purchase list,” June 6, 2017

The Washington Post, “A foreign buyer brings complications to a real estate deal,” Nov. 20, 2015.