Buying & Selling Commercial Property
Whether you are buying or selling your commercial property, there can be a wide range of complicated considerations and tasks that must be accomplished before legal completion can occur. A common misconception is that commercial property is no different to the purchase or sale of residential houses. Whilst there are some elements of crossover and similarity, there are other legal requirements involved, other bespoke questions which sellers must answer and which buyers must understand and the standard terms and conditions upon which commercial properties are acquired and disposed of can be very different.
Buying & Selling Commercial Property
The buying and selling of commercial property is usually governed by a commercial contract, under which a standard set of commercial terms and conditions apply.
The nature in which the process for acquisition and disposal unfolds, however, will depend on the type of transaction. There are different ways in which commercial property can be sold, including (but not limited to):
- Acquisition and disposal of charitable land or property;
- Acquisition and disposal of property subject to occupational tenants;
- Buying and selling at auction;
- Buying and selling land or property by private treaty;
- Buying and selling of agricultural or unregistered land;
- Buying and selling of bare land intended for development – both with and without planning;
- Buying and selling of bare land subject to overage or claw-back provisions;
- Buying and selling property into or owned by Self-Invested Personal Pensions;
- Conditional contracts dependent on certain trigger-points (such as the grant of planning); and
- Investment purchases for limited companies.
- There are a vast number of considerations for buyers and sellers that will depend on the bespoke structure of the transaction at hand.
Our commercial property specialists have wide and established experience in acting for both buyers and sellers on a range of complicated and demanding commercial property deals and are in a strong position to offer tailored advice based on a key understanding of your requirements and those of the commercial terms.
Buying a Commercial Property
It is essential to establish the source of funds that will be used to assist the purchase. You will need to know (and be able to provide us with evidence and explanation of) where the money to fund your transaction will come from.
This will often be private savings/retained company funds or a commercial loan or mortgage facility. When a loan is being used, you should ensure that your loan offer is made available to us in good time and might want to speak with your financial advisor or lender, before making of any formal offer to your seller.
This firm strongly advises that commercial property searches are procured in all transactions and they will be mandatory for all purchases involving loans and mortgages. A contract pack will be procured from the seller’s solicitor, which will contain a draft contract, title deeds proving the seller’s ownership of the property and a range of answers of standard commercial questions.
It is then up to us to conduct a comprehensive review of the contractual terms and conditions of the contract and the property title deeds – and report to you on the information. We will also review and question any commercial property searches. We shall also examine the replies to enquiries offered by the seller and may have additional question we wish to ask, to obtain information to ensure the efficacy of your purchase.
Selling a Commercial Property
To allow us to sell your property, it is important that we are able to demonstrate your legal ownership to it. If your land or property is registered, it is likely that we will be able to obtain the title deeds electronically from the Land Registry, but you may hold original deeds and documents, with which we should be provided – if it is unregistered, these deeds and documents are essential.
Where your property is mortgaged, it might be that the lender has possession of title information, which we will also ask them for (and might need your authority). We will also need to obtain the lender’s permission to the sale and ensure that their loan to you is repaid on completion and that the mortgage is discharged.
We will need to provide you with a standard set of questions relating to your land and property, which you must use your best efforts to answer – we can assist with this. Once that process is completed, we will be able to assemble a contract pack (including a draft contract and your title to the property) and give this to the buyer’s solicitor. We will then assist you with answering any title enquiries or additional questions that the buyer raises through their solicitor.
