Real Estate and Property Development in Saipan
Property Investments in the CNMI
Dotts Law has been involved in some of the largest leasehold acquisitions of Saipan real property for resort developments. Our attorneys have extensive experience in Real Property, representing landowners, landlords, buyers, developers, investors, and brokers with projects on Saipan, Rota and Tinian. If you are looking to invest in real estate or develop property in the CNMI, you want Dotts Law on your side.
Real property law in the CNMI is unique in the United States
Land transactions are more complicated in the CNMI than in most jurisdictions because there is a limitation on who can own land in the CNMI and what interests may be transferred. The transfer of interests in land are also made difficult by title issues unique in many ways to the CNMI, boundary issues (encroachments), development restrictions such as setbacks from the Lagoon, and environmental and zoning restrictions. Handling land transactions in the CNMI requires knowledge of all these issues.
Preliminary Title Reports (PTRs)
Title to property on Saipan is often “clouded”. A PTR confirms the record owner of the property, the legal description of the land and title exceptions. A PTR is preliminary to the issuance of title insurance, and should be reviewed with an attorney.
Reviews and Studies
On the Northern Mariana Islands, there are environmental issues that can affect property development plans. These issues include the presence of endangered species, wetlands, floodplains, and even toxic materials. There are also special restrictions for certain uses.
Having a good lease to sign is of critical importance. You can hold the lease in the name of a person, in a trust, or in the name of a company. Be clear on the consideration to be paid, the lease term, assignments and subletting. A good lease addresses how a dispute will be handled.
Sign an Agreement
If you are interested in acquiring a property in Saipan, the first step is to lock in the price and prevent the owner from giving the property to someone else. Locking up the property is done with a document called an “Agreement to Lease.”
The Agreement only locks up the property for a short period of time. The lock up period gives you time to make sure that the property meets your needs and that the lessor actually has good title to the property. It also gives you time to move money into the CNMI to pay for the property.
Lease Term and Article XII
Saipan restricts ownership of land to persons of “Northern Mariana Islands descent” or NMD. For everyone who is not NMD, the longest interest in real property that can be held is 55 years.
A violation of Article XII renders the lease “void ab initio” which means void from the beginning, as if the lease never existed. Condominium units built above the first floor are the exception.
About Real Estate in the CNMI
Recently in our office we have seen clients who have signed “option contracts” to sell their property and didn’t understand what they had signed....
Investors often come to our office already having found property they want to lease and having already reached an agreement with the owner on the...
“I have a bridge to sell you…” Or, How to Use PTRs when you Lease Land on Saipan so that You Know Who Really Owns It George C. Parker was known as...