2 Types of Trusts Commonly Used in Commercial Real Estate Transactions

01/15/2024 10:53 AM Mark Goodman

In the world of commercial real estate, trusts are legal instruments that are often used to designate what happens to property after an owner passes away. Trusts come in several different types – each with their own idiosyncrasies. In this article, we are going to discuss three types of trusts that are commonly used in commercial real estate transactions.

Living Trusts

The most commonly used trusts in the commercial real estate world are living trusts (also known as inter-vivos trusts). As the name suggests, a living trust is set up by the trustor while they are still alive and may detail distribution of assets during or after their life.

Testamentary Trusts

As opposed to living trusts which are created while the trustor is still living, testamentary trusts are created by a trustor’s will after they die. The testamentary trust itself operates as the trust agreement in these cases when title insurance is involved.

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