Buying and selling business property
QualitySolicitors can help businesses to buy or sell their commercial property. There are many issues to consider, and we can make sure you understand every one. Buying or selling a business property is one of the most significant financial commitments a company will make. According to HM Land Registry, most routine property transactions are completed within 15 to 45 days, with almost all finalised within 4 to 5 months. Having expert legal support can help keep your deal within these timescales. Delays or mistakes can increase costs, disrupt operations, or even cause deals to collapse.
Why Commercial Property Transactions Need Legal Expertise
Commercial property deals carry significantly higher risks than residential purchases. There are a number of factors that contribute to these challenges.
Key risks include:
- Environmental liabilities - Commercial sites may have environmental issues such as pollution, which can be costly if not identified early. Legal advice ensures that thorough environmental due diligence is conducted before completion.
- Planning permission restrictions - Planning rules and restrictions can affect how a property may be used or developed. Solicitors help assess and navigate these regulatory hurdles.
- Lease assignment complications - Assigning an existing lease can be complex if multiple parties are involved. Commercial solicitors make sure smooth lease transfers.
- Stamp Duty Land Tax (SDLT) miscalculations - Errors in SDLT calculations and submissions can result in unexpected costs. Legal assistance can correctly calculate the SDLT and avoid unexpected financial risks.
Key Steps in Buying a Commercial Property
Step-by-Step Commercial Property Purchase Process
Initial Legal Due Diligence
Professional searches form the foundation of any commercial purchase. Standard searches typically cost £400-£800 and include:
- HM Land Registry searches - Verify ownership and restrictions
- Environmental searches - Check contamination risks
- Planning searches - Confirm permitted uses
- Utilities searches - Identify service connections
Contract Preparation and Review
The sale contract must address commercial-specific clauses. RICS guidelines recommend including:
- Heads of Terms agreement
- VAT election status
- Service charge provisions
- Repair and maintenance obligations
Funding and SDLT Calculations
Commercial SDLT rates differ from residential property. Current HMRC rates for non-residential property are:
- 0% on the first £150,000
- 2% on the next £100,000 (£150,001 to £250,000)
- 5% on the remaining amount (above £250,000)
Commercial mortgage lenders typically require 20-40% deposit, with 25% being the standard minimum as loan-to-value rates rarely exceed 75%.
Exchange and Completion
The TR1 transfer form finalises the ownership transfer. Critical completion day tasks include:
- Final searches (within 2 weeks of completion)
- Funds transfer via CHAPS
- Deed registration with the Land Registry
- Insurance policy transfer
Selling a Commercial Property
When selling, preparation is key:
- Provide title deeds, leases, and warranties early to avoid delays.
- Respond quickly to buyer enquiries to maintain momentum.
- Consider Capital Gains Tax (CGT) implications (HMRC guidance).
How Quality Solicitors Help Business Owners
QualitySolicitors works with many business owners, advising them on their commercial property needs. We help you prepare. As your property advisor, we ensure you understand any agreements. We carry out work on your behalf, such as searches, keeping you informed throughout. If we need to negotiate for you, we will conduct this according to the outcomes you want to achieve. You will know likely costs, timescales and any risks associated with the transaction. And we make sure everything runs as smoothly as it can, right until you sign the contracts.
Contact Us
For expert advice on buying or selling a commercial property, call us today on 08082747557 or fill out the enquiry form, and we will get back to you.