A letter of intent (LOI) to purchase commercial real estate is a letter a buyer sends to a property owner to set out the basic terms of a possible sale. It is shorter and simpler than a full contract and uses far less legal language. Both sides can read it, talk through the points they do not agree on, and move on to a full purchase agreement.
Last Updated: October 2026. This guide is reviewed and updated regularly to reflect current law. If you notice an error or outdated information, please contact us.
How to Prepare a Letter of Intent to Purchase Commercial Real Estate?
Most commonly, this offer is non-binding, meaning that parties agree to create a comprehensive contract in the future. A buyer who is serious about buying commercial real estate usually writes the LOI. The seller or the seller’s broker typically supplies most of the details. The buyer can find the rest during early due diligence, which is a first check of the property and its papers.
Along with summarizing the terms of the purchase agreement, the LOI helps parties initiate the negotiation process and conduct due diligence before they enter into a legally binding agreement.
To learn more about letters of intent, read our full guide: https://formspal.com/letter-of-intent-template/.
How to Fill Out a Letter of Intent to Purchase a Commercial Property
A commercial real estate LOI often runs from one to three pages, depending on how complex the property is. Gather the property address, the names of both parties and the offered price before you start, then work through the steps below in order.
With this free fillable letter of intent to purchase real estate, a buyer and seller can get a concise picture of what their future agreement might look like and discuss the terms that they do not agree with before executing a formal binding agreement.
- Purpose and property address. The letter of intent should start with stating its purpose – in our case, serving as a non-binding letter of intent to purchase property located at [insert the address of the property].
- Buyer and seller. Name the buyer and the seller, and add the address and contact details of each party.
- Purchase price. State the price you offer. Write it in both words and numbers, for example $100,000 (one hundred thousand dollars).
- Terms for financing. Say how you plan to pay. If you will use a loan from a third party, mention it. In this section, parties might also mention who will pay for fees associated with the purchase (closing fee, transfer tax, etc.).
- Due diligence. Add the time you need for due diligence, which means checking all the documents that relate to the deal. Count the inspection period plus any extra time needed to close the deal.
- Closing date. Give the date when the sale is expected to close.
- Escrow. This section should include the title of the escrow agent (with their address and contact details) and the amount of the escrow deposit.
- Additional clauses and terms. Mention any extra clauses or terms the offer depends on, for instance a broker commission or other agreements.
- Documents needed to close. List every document you need from the seller, such as:
- Insurance policies
- Tax returns for the past several years
- A map of the commercial space
- Copies of existing leases
- Profit and loss statements for the past several years
- Accounts receivable
- Past utility receipts
- Any other document that helps you confirm that the space meets your standards
- Inspection period. State how long you have to inspect the property, for example the foundation and the heating and air conditioning systems. The section should also include the statement that in case the buyer finds any unacceptable conditions of the seller’s documents or property, the purchase agreement can be canceled and the buyer should get back their earnest deposit.
- Acceptance. Say until what date the offer stays open.
- Binding effect. Lastly, if the offer is not legally binding, it should be stated in the letter.
- Signatures. Signatures of both the seller and buyer should finish the letter, making it valid.
Tip: Before you send the letter, read it once against the steps above. Check that the property address and both names are spelled the same way everywhere, and keep a signed copy for your records.
Sample Letter of Intent to Purchase Commercial Real Estate
Use this sample as a model for your own letter. The names, addresses and dollar amounts are made up. Swap in the real details of the property, the buyer and the seller, then compare each line with the steps above before you send it.
From: Lory Markle
7097 W. Princess Street
Angleton, TX 77515
April 4, 2021
To: Theon Black
74 Thompson St.
San Antonio, TX 78211
RE: Letter of intent to purchase commercial property at the address 49 West James Ave. Houston, TX 77081.
Dear Mr. Black,
Pursuant to this letter of intent, Lory Markle (Purchaser) intends to purchase from Theon Black (Seller), a corporation organized and existing under the laws of state Texas, with its principal office located at 49 West James Ave. Houston, TX 77081, herein referred to as Property, on the following terms and conditions:
- The Buyer. Lory Markle
- The Seller. Theon Black
- Description of property. All real and all personal property located at 49 West James Ave. Houston, TX 77081, including all leases, agreements, and intangibles related to the Property.
- Purchase price. The Purchase Price shall be $100,000 (one hundred thousand dollars), payable in cash.
- Bank financing. The Buyer has made it known that their ability to buy Property is conditional on financing. The Buyer agrees that if they are unable to obtain a commercial real estate loan, this letter of intent and the clauses of the future Purchase agreement are no longer valid.
- Closing. The Closing should occur on April 14, 2021, or earlier by mutual agreement between the Buyer and Seller.
- Closing costs. All costs associated with Closing should be the responsibility of both the Buyer and the Seller, bearing their own expenses.
- Possession. Possession of the Property should be given on April 14, 2021, or earlier by mutual agreement between the Buyer and the Seller.
- Property inspection. Once the Buyer and the Seller execute a binding formal agreement, the Buyer has seven (7) business days to inspect the Property.
- Binding effect. This letter of intent is created solely for the purpose of negotiating the terms of an additional binding agreement.
- Acceptance. If you agree to the terms mentioned above, please sign this Letter of Intent and return the duplicate copy within five (5) business days after the delivery.
Buyer: Lory Markle Date:
Seller: Theon Black Date:
Frequently Asked Questions
Buyers and sellers of commercial property often ask the same practical questions when they put together an LOI. They want to know what to include, how long it runs, what happens after both sides sign and whether they can create one online.
What does an LOI to purchase commercial real estate usually cover?
It usually names the buyer, the seller and the property. It also lists the offered price, the way the buyer plans to pay, the closing date and the escrow details.
What details should I gather before I write an LOI?
Gather these details first:
- The address of the property
- The full names and addresses of the buyer and the seller
- The price the buyer offers and the way the buyer plans to pay
- The target closing date
- The name and contact details of the escrow agent
With these details at hand, the LOI is much quicker to fill in.
How long is a typical LOI?
Most LOIs run one to three pages. A simple deal for one building often fits on a single page, while a larger property with many leases takes more room.
Who receives the LOI?
The buyer sends it to the property owner, or to the owner’s broker when the owner works with one. Keep a copy of what you send, so both sides can look back at the same wording during talks.
How is an LOI different from a purchase agreement?
An LOI is a short outline of the main terms. A purchase agreement is the full contract, so it is longer, more formal and covers every detail of the sale. Think of the LOI as the first draft of the deal and the purchase agreement as the finished version.
What comes after the LOI?
Once both sides agree on the main terms, the next step is a full purchase agreement that spells out every detail of the sale. Many buyers also begin due diligence at this stage.
What should I check before I send the LOI?
Read every line once more. Confirm the price, the dates and the names of both parties, and make sure the property address matches on every page. If anything is unclear, ask a real estate attorney or your broker to take a look.
Can I create an LOI online?
Yes. Use the Create My Document button at the top of this page, answer a few questions and download the finished LOI.
General information, not legal or tax advice.
With over 25 years of experience as a business and transactional attorney, Jennifer has mastered the craft of closing highly successful deals for her clients. Through her wide-ranging expertise in commercial contracts, real estate transactions, M&A and corporate law, Jennifer secures results that are second-to-none.
Published: Jul 20, 2022
