Selling any property can take time, and this is especially true for commercial property. Although the aim of any conveyancing transaction is to put a property to market and sell it as quickly as possible, commercial property sales are dictated by:
Current property prices
The current state of the market will directly affect how the commercial property sector is performing.
Buyers are looking for commercial property of a specific size and nature. It’s much easier, and more profitable, to sell your property in a thriving market.
Often, however, it’s the legal considerations which influence how easy it will be to sell the property.
As is true with all conveyancing, commercial property sales can be complex, and buyers need a lot of information before they will commit to the purchase. Typically, due diligence involves but is certainly not limited to:
• Asbestos reports and surveys
• Title searches
• Environmental and ground reports
• Development plans and planning permissions
If buyers can only use the property for certain activities, or others can access the premises, this may affect how easy it is to sell the property.
The building should be fully compliant with national laws and regulations on everything from accessibility to fire safety.
Zoning and planning
The zoning or planning class your property falls under affects what the premises can be used for, and how easy it will be to change its use in the future. Buyers will consider this before purchasing, and so they need as much information as possible.
Once contracts are exchanged, deposits are paid, and the sale becomes legally binding, there are timeframes which must be adhered to, and there are consequences for breaching the contract. It’s best to consult a commercial solicitor when you’re first interested in selling so that you don’t fall foul of any legal obligations, and to ensure you secure the best deal possible.
When selling a commercial property, there are costs involved. Reports like those mentioned earlier can be costly, and the prices vary depending on the complexity of the report.
Any professionals you have instructed, such as solicitors and surveyors, must be paid for their services.
Incidental costs and premiums
Reports such as those mentioned earlier all incur costs, and the price varies depending on the complexity of the report. Costs are also payable for incidental matters such as Land Registry registration.
Marketing is crucial to selling a commercial property, as you need to maximise the property’s exposure to the right audience. Advertising incurs further costs which you should bear in mind.
Taxes such as Capital Gains Tax (CGT) may be payable upon disposal of commercial premises, and it’s important you’re aware of what the cost will be.
Alterations and repairs
Before selling your property, you need to ensure it complies with regulations and that it will appeal to buyers. The cost of upgrades and fitting-out must be considered.
Above all, you need to ensure that selling your commercial property makes financial sense to you at this moment in time, and from a practical point of view.
Before selling your commercial property, you should consider:
• If your property is fit for sale – if not, how much will it cost to upgrade and how long will this take
• If there is a market right now for the size and type of premises you are offering
• If you have the financial resources to have the required reports and fees attended to
• If selling the property is aligned with your commercial objectives.
It’s imperative that you instruct a solicitor from the outset to ensure you fulfil your obligations and that the transaction goes as smoothly as possible.
If you are looking to sell your commercial property or wish to find out more about the commercial property services we offer, get in touch with AMD Solicitors. Our expert team of commercial property solicitors in Bristol can provide guidance and assistance with the entire process. Simply call our team on 0117 973 3989 or fill out a contact form to find out more.