While commercial sales transactions can be far more complex than their residential counterparts, often involving a myriad of partners, sophisticated financing & sky high valuations, the underlying purchase process is very similar. Below are the 7 (over simplified) steps of a commercial sales transaction in California:

1. Ensure your financing is in order: While not a hard-set rule, unless seeking seller financing or an all cash closing, you will likely want to ensure your financing is in order prior to making an offer. This can be traditional bank financing, an SBA loan (more on this in a post to follow), or for larger deals CMBS debt & crowd funding.
2. Submit an offer to purchase: This can be a legally binding purchase sale agreement (PSA) or a simple & non-binding term sheet. Either way the basic terms & conditions of the offer should be included such as — purchase price, closing timeline, due diligence period & any contingencies requested. 
3. Negotiate terms: Unless your offer involved grossly over paying for the deal in question, the next step will almost always involve a negotiation process. This includes negotiating both the basic deal points discussed above as well as the language of the PSA, which will become the legally binding contract when signed by both parties. This document is almost always drafted by a real estate attorney, and typically both sides of a transaction will hire a real estate attorney to review and negotiate on their behalf.
4. Sign PSA & deposit earnest money:  At this point, the document becomes a legally binding contract. The earnest deposit is usually a token amount, i.e. 1-2% of the purchase price.
5. Conduct due diligence: This period is typically 30-60 days but can vary greatly based on the deal in question (duration stipulated in PSA). Due diligence items include:
   • Physical property inspection
   • Phase 1 environmental site assessment (ESA). This report identifies potential contamination liabilities (either past or present) and is typically required for bank financing. If potential contamination is identified, a Phase 2 report is conducted utilizing physical tests of the dirt & ground water on site. Finally if the Phase 2 report confirms contamination, a Phase 3 report is required to lay out a remediation plan.  
   • Title report (usually involving an ALTA survey to confirm property boundaries) 
   • Appraisal  
   • Review seller provided documents & disclosures such as: expense & tax history, covenants, conditions & restrictions (CC&R’s), building plans & past construction permits, etc.
6. If satisfied, waive contingencies: This is also known as “going hard,” as earnest money typically becomes non-refundable after the contingency period. Alternatively, the buyer can generally back out of the deal if unsatisfied during the due diligence period or can request an extension if additional time is needed.
7. Wire funds & close purchase:  Prior to the stipulated closing date, the Buyer will wire/deposit the remaining funds as stipulated by the settlement statement. This document is prepared by the escrow agent (different from the title company, however many firms can handle both the title and escrow functions) and summarizes all fees associated with the transaction as well as seller/buyer debits & credits. This includes broker commissions, title insurance policy fees, escrow fees, transfer taxes etc – These fees are negotiable but generally follow county norms:

At closing, the funds are released from escrow, title is transferred from the seller to the buyer & the title company (typically chosen by the buyer) issues title insurance. The process above can vary in length based on the complexity of the deal, financing constraints & any delays that occur but a common closing period is 60-120 days.