Is the real estate purchase a separate agreement from the business purchase?

A buyer negotiating one purchase price for a business and its building often assumes there will be one document to sign. In practice there are usually two, because the two assets transfer under entirely different legal mechanics.

Different assets, different transfer mechanics

An operating business, its goodwill, equipment, contracts, or its shares, transfers under general contract and corporate law, while real property transfers by registering a deed or transfer at the applicable provincial land registry. These are two different registration systems with their own document requirements and timelines, which is most of why lawyers keep them as separate agreements even for a single buyer and seller.

Cross-conditions protect both sides

The business agreement is typically made conditional on the real estate agreement closing, and vice versa, so a buyer is not left owning a building with no operating business inside it, or a business with nowhere to operate from, if one half of the deal falls through during due diligence.

Financing usually follows the same split

A lender financing the operating business and a lender financing the real property as commercial mortgage collateral, sometimes the same institution and sometimes not, typically underwrite each piece separately, even when they close on the same day. A buyer should expect two sets of financing conditions to satisfy, not one blended approval.

Tax treatment differs by agreement, not by the deal as a whole

Sales tax and land transfer mechanics generally apply differently to the business-assets side of a transaction than to the real-property side of the same overall deal, another reason the two are documented separately rather than as line items inside one contract. Confirm with your lawyer and accountant how each specific agreement is taxed, rather than assuming one blended treatment covers both.