Using mediation to resolve commercial real estate disputes

Using mediation to resolve commercial real estate disputes

| Feb 19, 2020 | Dispute Resolution

The adversarial nature of arbitration and litigation increases the potential that these procedures will last longer than they should. In business-to-business disputes, there are many forms of mediation that allow companies to settle without incurring too much loss. For the companies in conflict to pursue mediation, it is usually necessary that they stand a reasonable chance of negotiating to the satisfaction of each party. Their incentive increases when there are business interests at stake that could be diminished by extended litigation.

Letting the market guide resolutions

Commercial real estate disputes can be prime candidates for mediation over litigation. Real estate markets favor quick resolutions. The dynamic nature of these markets means the value of a property can vary significantly from the beginning of a dispute to its end. Here are some scenarios that can resolve more efficiently via mediation:

  • Breach of contract: With purchase or sale agreements, the timing is incredibly crucial as commercial markets change.
  • Co-owner disputes: Co-owners in conflict can miss prime decision-making windows for choosing to invest or sell.
  • Improvements and alterations: These changes improve the quality of life in a space and can create value in a property. But if a dispute arises with a contractor or construction company, that unfinished space can become a liability.

Working together to settle disagreements

Mediation is generally faster, more cost-effective (with regards to legal fees and time lost), confidential, and allows the parties involved to maintain control over their negotiations. If your business is having difficulty negotiating with a business partner or another company, it is in your interest to hire an expert mediator with experience in business law and dispute resolution.