Commercial Escrow Take in CA
California commercial escrow rarely closes in the 30 day window that residential agents promise. The statewide average now sits at 45 to 75 calendar days, and Los Angeles County deals often push past 90 when lenders, tenants and city inspectors all want a seat at the table. The clock starts when fully signed escrow instructions are delivered and the buyer’s earnest money is credited, not when the purchase contract is inked. That distinction can add a week if the LOI and the escrow opening are handled by different counsel.
Multifamily assets with more than four units require tenant notification packages under state law. The statute gives occupants 30 days to respond, and most buyers will not waive that contingency until the last estoppel is returned. Office and industrial buildings trigger additional environmental review. Even a clean Phase I Environmental Site Assessment can take 21 days to prepare and peer review; if the report flags historical dry cleaning solvent, a Phase II subsurface investigation adds another 30 days and another five figure invoice.
Lenders drive the longest delays. Life company and CMBS loans need third party reports, appraisal updates and internal credit committee cycles that rarely finish in less than 40 days. Bridge lenders move faster, but they still require a new appraisal and a fresh ALTA survey if the existing one is older than 90 days. Mezzanine capital adds another layer because the intercreditor agreement must be negotiated while escrow is open, pushing the close date out an extra two weeks.
Typical Day Count by Property Type
- Single tenant retail (no financing): 30 to 35 days
- Multifamily 5 to 20 units (bank loan): 50 to 55 days
- Office tower (CMBS): 65 to 75 days
- Industrial park (bridge to HUD): 80 to 90 days
Sellers can shorten the cycle by ordering title and survey as soon as the property hits the market. Buyers can save a week by pre underwriting with their lender and delivering due diligence documents in one indexed PDF instead of scattered emails. Escrow holders cannot speed up the county recorder, but they can queue the deed and assignment documents the moment loan docs are approved, trimming one business day off the back end.
Extensions are expensive. Most escrow companies impose a per diem fee of $250 after the stated closing date, and lenders will charge a daily extension fee equal to the note rate applied to the loan balance. On a $15 million loan at 6 percent, that is roughly $2,400 per day. A simple pre negotiated extension cap, “five business days at buyer’s sole cost, thereafter seller may terminate”, keeps everyone honest.
Green building laws now impact timing. Starting January 1, 2026, the City of Los Angeles will withhold certificate of occupancy until energy use benchmarking data is uploaded to the state portal. If the seller has not obtained the certificate, escrow cannot close. Build an extra 10 days into the contract and confirm the certificate status during due diligence.
Bottom line: commercial escrow in California is a relay race, not a sprint. Order reports early, respond to lender conditions within 24 hours, and keep your escrow officer in the loop every time a milestone slips. Secured Trust Escrow maintains dedicated commercial coordinators who track each third party report and flag delays before they compound. Contact our team today for a day by day closing roadmap tailored to your asset class.
