Lawyers specialising in buying, selling and leasing commercial property
If you are buying or selling commercial property, whether it’s freehold or leasehold, you will need to go through the commercial conveyancing process. This can be lengthy and there are many checks that need to be carried out before completion can take place.
A property may be subject to leases and tenancies, which can make matters more complex. Completion may take longer than buying or selling a house, but that depends on the complexity of the transaction, and the speed of the lenders and the respective solicitors involved on both sides. And here at Bonallack & Bishop, we regularly represent buyers and sellers in a full range of commercial conveyancing transactions, including for business use, redevelopment and investment.
Need a specialist commercial property conveyancing lawyer? Call us on FREEPHONE 0800 1404544. Initial legal advice on the phone is always FREE.
Agreeing the basics – heads of terms
At the start of the transaction, you can negotiate and agree on heads of terms. This is a document that sets out the agreement between the buyer and seller. It covers the key points that have been decided and is a roadmap for how the transaction will be dealt with.
Heads of terms should always be marked ‘subject to contract’ as they are not intended to form a binding contract.
As well as establishing exactly what is agreed upon and issues such as rights that are to be granted and a timescale, negotiating heads of terms can avoid misunderstandings later on. By dealing with potential sticking points at the outset, the sale and purchase stand a better chance of completing successfully.
While heads of terms are not intended to be legally binding and should be carefully drafted to avoid this, they help both parties understand what is expected of them and the scope of the transaction.
Commercial property and due diligence
Comprehensive due diligence work is essential if you are buying a commercial property. You need to ensure that the legal title is sound, that you will be able to use the property in the way that you wish and that when the time comes to sell it on, there is nothing that could put off a buyer.
Your solicitor will carry out all of the legal due diligence, but you are also advised to do your own research into issues such as market demand, both for buying and leasing the type of property you will be buying. Where necessary, you can ask your surveyor to provide some of this information.
Issues that your solicitor can look at include:
· Going through the legal title and raising enquiries with the seller’s solicitor, such as:
o What alterations or works have been carried out at the property and whether there are the necessary planning consents and any guarantees
o Whether the rights attached to the property have always been freely exercised
o Details of the tenancy where the property is subject to a lease
o Whether the seller is aware of any breaches of restrictive covenants that apply to the property
· Applying for searches and going through the results
· Checking planning consents and what the property can be used for
If the property has a tenant, there are a substantial number of issues that you will need to be aware of, including:
· The length of the lease and whether it includes any break clauses allowing your and/or the tenant to end the term early
· What rent deposit is held
· How much rent is paid and how and when payments are made
· What subletting and assigning provisions are included in the lease
· Whether the tenant has security of tenure, i.e.. whether they have the right to renew the lease at the end of the term
· How the tenant is using the property
· What alterations the tenant is permitted to make
· What repairing and condition clauses are included in the lease and what your liability will be
· Whether there are any limits to the amount of service charge that can be charged
· What you are required to provide in return for service charge payments
· How a rent review will be dealt with
Your solicitor can advise you on whether and how you may be able to give notice to the tenant to vacate the premises. You should note that this is not always possible and it will depend on issues such as the terms of the lease and what you want to use the property for.
Agreeing on a contract
The seller’s solicitor will provide your solicitor with a draft contract for approval. This will include issues such as warranties and indemnities, restrictive covenants and the rights and obligations you will be taking on in respect of the tenant.
Your commercial conveyancing solicitor can go through the contract with you and negotiate the terms and conditions where necessary to make sure that your rights and interests are protected as far as possible.
Advice on tax and financial liabilities
Your solicitor will advise you on the amount of Stamp Duty Land Tax that will be payable on completion as well as the amount needed to complete the purchase. This will take into account any rent and service charges to be apportioned if the property is subject to a tenancy.
Your lawyer will also deal with your lender if you are obtaining finance, to include reporting to them on the title and ordering funds for completion.
Commercial property conveyancing and completion
Once all of the pre-contract enquiries have been satisfied and your solicitor has approved the contract, exchange of contracts can take place. This will set a binding date for completion.
Following completion, Stamp Duty Land Tax will be paid and the property registered into your name. Your solicitor will deal with any other issues, such as serving notice on the tenant of the transfer and providing them with your details for payment of rent and service charges.
Our Solicitors can help you with a ride range of commercial property deals
Our experienced teams are here to assist you on a full range of commercial real estate transactions including the following:
• Agricultural property and tenancies, including buying and selling farms.
Click here to find out more about our Agricultural and Rural Property
• Business sales involving aspects of commercial property
Click here to read more about how our Business Sale Solicitors can help you
• Buying and selling commercial property
• Commercial property disputes –
Click here to read more about Commercial Property Disputes
• Investment sales and purchases – see below.
• Landlord and tenant issues
Click here to discover how our property team support residential and commercial landlords.
• Loan Agreements and commercial mortgages
• Site acquisition or development
• SSAS pension investments
Our commercial property lawyers handle a wide spectrum of commercial property transactions – which range from offices and shops to industrial units, pubs, hotels and mixed use schemes.
Getting the right professional guidance
Commercial property ownership can be complex and onerous and it is important to have expert legal advice before you enter into a transaction. And our commercial property team have the experience to make sure your sale or purchase goes smoothly and that delays are avoided wherever possible.
Dealing with commercial property is rarely straightforward and it is vital to make sure that you understand all of the liabilities. If you are buying, we will carry out robust due diligence work to check that the property you are taking on is legally sound.
We know that time is often of the essence and we always work proactively to move a transaction on effectively. Our team will keep in close contact with you throughout so that you always know what stage has been reached. We are easy to contact, so you can ring us whenever you need to if you have questions or concerns.
Our Specialist Team for Property Investors
If you’re looking to make investments in residential or commercial property, our specialist property investor team can help! We specialize in helping both companies and individuals with active commercial and residential portfolios, giving them the best advice and assistance when it comes to real estate investments. With our expertise, you can rest assured that your property investment process will go smoothly.
Click here to discover more about how our specialist Property Investment team can help you