A Houston seller lists an office building, gets a strong offer, and watches the deal die on day 47. Not because the buyer walked. Because the seller couldn't produce a clean rent roll, three leases were missing amendments, and an old mechanic's lien nobody knew about took two weeks to clear. The buyer's lender moved on.
That happens more than it should. Selling commercial property in Texas is a paperwork exercise as much as a negotiation. The sellers who close on time show up prepared. The ones who don't hand the buyer leverage to chip the price or walk.
Here's what the process actually looks like in Texas, where it stalls, and what to handle on the front end.
The Texas CRE closing timeline
Plan for 45 to 90 days from signed contract to funding. Vacant land closes faster. Retail and office with tenants in place run longer. Three things decide where you land: how fast you produce documents, how deep the buyer's due diligence goes, and how quickly the title company clears every lien and exception.
Most deals use the Texas REALTORS commercial forms or, more often on larger transactions, an attorney-drafted Purchase and Sale Agreement. The contract sets the feasibility period (typically 30 to 60 days), the earnest money terms, and the closing date. Once the feasibility period ends, the earnest money usually goes "hard," meaning it is nonrefundable if the buyer backs out.
What the title company actually does
Texas is a title state. In states like New York or Georgia, real estate closings happen at a lawyer's office. In Texas, they happen at the title company. The title company runs the title search, issues a title commitment, clears objections, prorates taxes, pays off your existing loans, and wires you the net proceeds.
A few Texas-specific steps every seller should expect:
Title commitment review. The title company delivers the title commitment within about 20 days of contract execution. The buyer reviews it for exceptions, such as old easements, prior liens, or restrictive covenants, and objects within the period set in the contract (commonly 7 to 15 days after delivery).
Cure period. You get an agreed window to clear the objections, or refuse to. If you refuse, the buyer can walk and get the earnest money back. Most objections are routine. The ones that aren't can take weeks.
Entity authority. If you sell through an LLC, partnership, or corporation, the title company needs your operating agreement, corporate resolutions, and a certificate of good standing from the Texas Secretary of State.
Old mechanic's liens, expired UCC filings, and probate issues drive most title delays. If you inherited the property or bought it through an entity that's since dissolved, start the paperwork the day the contract is signed.
Due diligence: what the buyer will demand
Commercial buyers run a heavier process than residential buyers. Expect requests for:
- Rent rolls and current leases, with every amendment
- Three years of operating statements and property tax bills
- Service contracts: management, landscaping, security, pest, HVAC
- A Phase I Environmental Site Assessment (sometimes a Phase II)
- A current ALTA/NSPS Land Title Survey
- Property condition report, roof and HVAC history, open repairs
- Certificates of occupancy and zoning verification letters
- Tenant estoppel certificates
Hand over a complete binder at contract signing and you close faster with fewer retrades. Every missing document is an opening to chip the price.
If you don't have a current ALTA survey, plan 4 to 6 weeks to get one done. Order it the day the contract is signed.
Tenants: estoppels, SNDAs, and notifications
If the property has tenants, they're part of the deal.
Estoppel certificates. The buyer's lender will want every major tenant to confirm in writing the rent, lease term, security deposit, and any defaults. Tenants don't move on your timeline. Send the estoppels the day you sign the contract.
SNDAs. If the buyer's lender is a CMBS shop, life company, or institutional bank, anchor tenants may need to sign Subordination, Non-Disturbance, and Attornment agreements. These protect the lender's foreclosure rights and the tenant's possession. They take time. Start early.
Tenant notification and deposits. After closing, tenants get a notice letter naming the new owner and where to send rent. The buyer typically drafts it. Security deposits transfer to the buyer at closing. That's required under Texas Property Code.
Texas property taxes at closing
Texas property taxes are assessed annually and paid in arrears. The title company prorates them based on the most recent certified statement or, if it isn't out yet, an estimate using the prior year's bill.
Two surprises catch sellers off guard:
Rollback taxes. If the property has been getting an agricultural or open-space valuation and the buyer changes the use, rollback taxes hit. Under current Texas law that's up to 3 years of back taxes plus interest (the legislature cut this from 5 years in 2019). Settle who pays before the contract is signed, not at the closing table.
MUD and PID assessments. If the property sits in a Municipal Utility District or Public Improvement District, separate assessments apply. Get the current payoff before the title company asks.
FIRPTA: are you a U.S. person?
If you're a foreign seller, or a U.S. entity owned by foreign persons, the buyer must withhold 15% of the gross sale price under the Foreign Investment in Real Property Tax Act (FIRPTA) and send it to the IRS.
For most Texas sellers, this is a non-issue. You sign a one-page FIRPTA affidavit at closing confirming you're a U.S. person, and the withholding goes away. The title company has the form.
If you are a foreign seller, talk to your CPA before listing. Exceptions and reduced-withholding paths exist, but they take advance planning.
1031 exchange: decide before you sign
If you plan to defer capital gains through a 1031 exchange, set it up before closing, not after. Once the proceeds hit your account, the exchange is dead.
The deadlines are strict:
- 45 days from closing to identify replacement property
- 180 days to close on it
You'll need a Qualified Intermediary in place before the sale closes. They hold the proceeds and handle the paperwork.
Here's the move most sellers miss: if a 1031 is even on the table, get your broker and your CPA in the same conversation before the property is listed. Not after the contract is signed. The decisions that drive a clean exchange, such as replacement target, timing, debt replacement, and depreciation recapture, land best with both advisors at the table from day one.
Service contracts and standing agreements
Most commercial properties carry standing contracts: property management, landscaping, security, HVAC service, pest control, sometimes a leasing exclusivity. Read each one before listing. Some assign automatically to the buyer. Some require notice to terminate. Some carry early-termination penalties.
The buyer will ask which contracts they're inheriting and which you're killing at closing. Have that list ready before they ask.
Financing delays you can't control
Most commercial buyers finance through a bank, a life insurance company, a CMBS lender, or an SBA 504 loan. Bank appraisals run 4 to 8 weeks. SBA 504 deals usually add 30 to 60 days for committee approval and CDC processing.
You can't speed up the lender. You can reduce surprises. Hand over the rent roll, three years of operating statements, and current leases on day one. Clean numbers move faster through underwriting.
Closing day
Both sides sign at the title company or, more often, remotely through e-sign and a mobile notary. The buyer wires funds. The title company pays off your existing loans, prorates taxes, pays commissions and closing costs, and wires net proceeds to you. Most wires land within 1 to 3 business days.
A few things to confirm before you sign:
- Bring a government-issued ID, even for remote closings. Texas notaries verify identity.
- If you're selling through an entity, confirm the authorized signer matches the title company's records before closing day.
- Verify wire instructions by phone, directly with the title company, on a number you looked up yourself, not one in an email. Wire fraud targeting Texas commercial closings has climbed. Scammers know when deals fund.
Set yourself up for a smooth close
Sellers who close on time share three habits. They hire a broker who specializes in Texas commercial real estate. They assemble due diligence materials before listing. They respond to the title company and the buyer within 24 hours.
Preparation keeps you in control. Scrambling hands the buyer the upper hand.
Frequently Asked Questions
How long does a commercial closing take in Texas?
Plan for 45 to 90 days from signed contract to funding. Tenanted properties run longer; vacant land closes faster. Document speed, due diligence depth, and title clearance decide where you land.
What documents should I have ready before listing?
Current rent roll with every lease amendment, three years of operating statements, existing loan payoff information, entity authority documents, any existing survey, service contracts, and a written list of known repairs. Having these in one folder before listing shaves weeks off the timeline.
What's a rollback tax and when does it hit?
If the property carries an agricultural or open-space valuation and the buyer changes its use, the buyer can owe up to 3 years of back taxes plus interest (Texas reduced this from 5 years in 2019). Settle who pays before the contract is signed, not at closing.
Do I need to set up a 1031 exchange before I list?
The Qualified Intermediary can wait, but the planning shouldn't. Get your broker and your CPA in the same conversation before the property is listed. Replacement strategy, timing, and debt replacement drive the outcome, and those decisions are easier to map out before a contract is on the table. Once the sale proceeds hit your account, the exchange is dead either way.
Sell prepared, not scrambling
Selling commercial property in Texas and want a direct read on what your closing will involve? Call me this week at 832.560.2100, or reach RE/MAX Commercial Advisors Group. We handle retail, office, industrial, and land across Texas. Tell us your situation and we'll tell you what to expect from day one to funding.
What matters to you matters to us.