Devon commercial property solicitor, Nick Arthur, has prepared a list of his top 10 tips for buying commercial property:
One: Do your homework by investigating the state of the local commercial property market. Bear in mind that the commercial property market is often very different from the residential property market. If in doubt, speak to local commercial property agents, or get a professional valuation.
Two: Make sure that your financing is in place before you legally commit. Speak to your accountant about structuring the deal in a tax efficient way to save you money and make provision against future tax bills. Your accountant will also be able to advise on whether you should purchase the property in the name of a company or another legal vehicle.
Three: Consider whether the commercial property you are buying is freehold or leasehold. There are pros and cons with both, and we will be able to run through these with you.
Four: Budget for any works that are likely to be needed, both now and in the future. If you are buying a commercial property as an investment, it is particularly important to consider how the cost of those works is likely to impact on rent yields and capital appreciation.
Five: Obtain a repair report from a buildings surveyor who is experienced in dealing with commercial property. Your surveyor may also be able to give you guidance on valuation.
Six: Talk to us about your intentions for the building. This enables us to ensure that all the appropriate searches and investigations are carried out. For instance, are there likely to be any planning issues for the use you have in mind? What access requirements do you have?
Seven: Find out whether VAT is payable on the property purchase.
Eight: Consider the energy performance of your building, ensuring it is not below EPC E. Bear in mind that this minimum standard is likely to be increased in the future.
Nine: If the property already has a tenant and you are happy for them to remain in the building, it is still important to consider their financial status as well as the terms of their lease.
Ten: Remember that the contract to buy the property only becomes binding once you have exchanged, and from that point you need to make sure the building is insured. The transaction will be finalised on the completion date, following which you will be able to take possession of the property. We will then deal with paying any Land Transaction Tax (LTT) or Stamp Duty Land Tax (SDLT) and registering your ownership with the Land Registry.
Slee Blackwell are experienced commercial property solicitors and one of the highest ranked firms in Devon on the independent review website, ReviewSolicitors.
Devon commercial property solicitor, Nick Arthur, will be happy to discuss your proposed transaction with you. Give him a call on 01271 372128 or send an email to [email protected]