Real estate · Industry brief

More than 30 states have enacted or significantly expanded foreign ownership restrictions on real property within recent years, creating a complex compliance landscape for commercial real estate transactions. These regimes vary dramatically in scope and enforcement mechanisms—ranging from Virginia's automatic voidness provision that transfers prohibited agricultural land acquisitions to the state with no compensation, to Alabama's prohibition with no specified penalty. Key compliance obligations now include enhanced due diligence on beneficial ownership, property classification, proximity to sensitive sites, and federal list designations; mandatory closing affidavits in states like Florida, Oklahoma, and Iowa; and post-closing registration and reporting requirements in Florida (30 days), Illinois and Maine (90 days), and ongoing annual certifications in Nebraska and North Dakota. The legislation targets designated adversary countries through various mechanisms including ownership thresholds, residency tests, and entity control analysis, with several states recognizing narrow exceptions for CFIUS-approved transactions, domesticated entities, or passive stakes in publicly traded companies. Some regimes have faced constitutional and federal preemption challenges with preliminary injunctions in certain instances. Source: JD Supra legal news analysis.

CFIUS received 347 covered transactions in 2025, up from 325 in 2024, with declaration filings increasing to 140 from 116 but clearance rates declining as the agency requested full notices in 26% of declarations versus 15% in 2024. Real estate filings remained rare, growing to seven notices from three in 2024, though CFIUS jurisdiction over real estate has expanded significantly with 2024 rulemaking broadening military installation proximity reviews and Treasury and USDA signing a Memorandum of Understanding in July 2025 on foreign agricultural investment oversight. Mitigation agreements declined slightly to 234 active arrangements from 242, reflecting Administration efforts to reduce long-term mitigation in line with the America First Investment Policy, while enforcement activity appeared down with no reported civil monetary penalties in 2025 compared to five in 2024 and formal inquiries declining to 62 from 76. Filing parties should expect heightened scrutiny of non-allied country investments and defense or critical-technology transactions, with CFIUS establishing a new Office of Research and Analysis and launching a Known Investor Pilot Program to expedite reviews of repeat sponsors and sovereign funds.

The article discusses deal fatigue in M&A transactions—the mental, emotional, and physical exhaustion that accumulates during lengthy negotiations and due diligence. It identifies warning signs including inadequate letter of intent negotiation, unprepared due diligence, prolonged negotiations, unclear timelines, re-trading of terms, and finish-line urgency. The piece recommends preventive strategies such as engaging experienced M&A counsel early, preparing virtual data rooms before signing the LOI, negotiating robust letters of intent that address deal structure and indemnification mechanics, and establishing realistic timelines and budgets. For active transactions experiencing fatigue, it suggests implementing structured communication with weekly status calls, delegating tasks to specialized advisors, and guarding against last-minute concessions that compromise deal terms. The source is JDSupra legal news.