A self-employed person running a small restaurant in a provincial area happened to hear that the building owner, due to old age, was planning to sell off a commercial building, and contacted the owner directly. Thinking of saving on brokerage fees, the buyer immediately met with the seller and began negotiating terms, seeking to push the contract through quickly based on the trust of being acquaintances. However, while drafting the contract, they belatedly realized they had failed to properly verify the tenant status, security deposit succession issues, and the encumbrances attached to the building.

Why Direct Sales of Commercial Buildings Are Increasing

Direct sales of commercial buildings often begin when buyers and sellers make direct contact through acquaintances or legwork. The background includes the desire to reduce brokerage fee burdens and changes in the environment that have made property information easily accessible through online communities and local cafés.

However, not going through a broker also means that procedures typically handled by brokers—such as reviewing the registry extract, verifying encumbrances, examining lease succession conditions, and drafting the contract—must be handled by the buyer and seller themselves.

Three Problems That Frequently Arise in Direct Transactions

Problems that frequently occur during direct transactions can be largely divided into three types.

① Unverified encumbrances: Cases where mortgages or seizure claims attached to the building are not sufficiently checked before the contract, leading to disputes after the balance payment is made.

② Lack of arrangement for lease and deposit succession: Cases where the terms of existing tenants' leases and whether security deposits are succeeded are not clearly settled, leading to conflicts with tenants after the purchase.

③ Inadequate recording of special clauses: Cases where special clauses are not specified in detail in the contract, leading to disputes over responsibility when defects or facility problems arise later.

What Can Be Missed with a Registry Extract Alone

In particular, unlike housing, commercial buildings often involve complexly intertwined issues such as tenants' business types, key money (premium) matters, and history of changes of use, so simply checking the registry extract can leave gaps. Some point out that rather than trusting only the documents presented by the seller, it is necessary to cross-check the building register and business registration status through the district office or tax office. However, the items to be verified may vary depending on the condition of each building and the contract terms, so it should also be kept in mind that general precautions alone cannot eliminate all risks.

Reducing Risk Through Professional Review

Some of those choosing direct transactions reduce risk by having a judicial scrivener or lawyer review matters from the contract drafting stage onward. Many opinions hold that even without going through a broker, receiving professional assistance with contract review, verification items at the time of balance payment, and the ownership transfer registration process helps prevent disputes. However, since the necessity and method may vary depending on individual cases, it is advisable to confirm specific judgments through consultation with professionals.

This article was written for the purpose of providing general information related to direct sales of commercial buildings and does not substitute for legal or tax advice on specific transactions or contracts. Since contract conditions, building conditions, and encumbrances may vary case by case in actual transactions, it is recommended to proceed only after individually consulting with relevant professionals such as lawyers, judicial scriveners, or tax accountants.

[This article was partially assisted by AI. It was written for the purpose of providing general information related to direct sales of commercial buildings and does not substitute for legal or tax advice on specific transactions or contracts. In actual transactions, encumbrances on the building, lease succession conditions, and special contract clauses may vary greatly case by case, so before signing a contract, one must consult individually with experts in relevant fields—such as lawyers, judicial scriveners, or tax accountants—and make careful judgments. No liability is assumed for any damages arising based on the content of this article.]