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Disclosure requirements for commercial property in California

On Behalf of | Aug 23, 2022 | Real Estate Litigation

California has some of the strictest disclosure laws in the country. Along with the typical disclosures of flood risks, environmental concerns and issues with systems in the building, commercial property owners must also provide information on energy efficiency, disability access compliance and more.

In 2015, the SB 1171 law was passed by the California state legislature. This re-categorized real property to include all commercial property. The law applies to selling commercial property and any lease that is more than one year.

California disclosure requirements for commercial property

Failure to disclose the following information about a commercial property can lead to serious issues and even litigation. Some of the key disclosures that must be made include:

  •         Water heater bracing
  •         Location of the property in a seismic hazard zone or earthquake fault zone
  •         Flood hazards and the need for flood insurance
  •         Location of a property in a Very High Fire Hazard Zone
  •         Wildland/urban interface area
  •         Earthquake safety improvements
  •         Mold presence

Don’t take chances with disclosure requirements

It’s important to work with someone who fully understands the extensive disclosure requirements in California. It’s also recommended that you over-disclose rather than omitting something that a party may have grounds to make a claim over in the future.

While “as is” provisions in the real estate contract may seem like enough to avoid liability issues, this isn’t always the case. You can’t rely on this to help you avoid issues.

Your role in commercial real estate disclosure

If someone brings a failure to disclose a claim against you, it can cost time and money. You can avoid these situations by disclosing all required issues based on California’s law. Working with professionals to help with this is recommended.