You might be thinking about selling your business property, whether it is accommodating your company’s expansion or that your business is looking for a new home, the process itself is both exciting and stressful.
First steps to commercial conveyancing
The concept of selling a commercial property is in many ways similar to how you would sell a residential property. There is, however, a few more details to pay attention to.
Step 1. Preparing the sales contract
You and your buyer will both require solicitors to help with the process of transferring your commercial property to the hands of your buyer.
The buyer’s solicitor will initiate an investigation on your property’s legal title when they first show interest in it. They will investigate upon any lease, like if your property is on lease hold. This will allow your solicitor to be able to prepare the sales contract once its title has been validated.
Step 2. Completing the relevant forms
Besides the contract of sale, your solicitor will also prepare the Commercial Property Standard Enquiries (CPSE) form to submit to the buyer’s solicitor. These are a set of enquiries sent on behalf of buyers, the details will help them understand the property they are acquiring.
To ensure a speedy sale, it is highly recommended that you provide the most detail to your best capacity when filling out the CPSE form, this will reduce the risk of delays and therefore help to ensure a smooth transaction.
Step 3. Providing the correct property’s details
Once the contract and form are prepared, you will also be required to provide details regarding the property’s details like: fixtures and fittings in your premises; and other information like an energy performance certificate.
There is a possibility that the buyer’s solicitor may want further clarification regarding the property even after all the relevant documents have been prepared, the more thorough they are the less problems there will be after the transfer.
Step 4. Exchanging the contracts
After the discussion of all the details, you can then proceed with exchanging contracts. The next step will be for the buyer to pay a deposit, the transaction will be legally binding past this point.
After the approval of the deed of variation provided by the buyer’s solicitor by your solicitor, an arrangement to discharge any mortgage to the premises will also be made. Completion will be in sight.
Step 5. The Final Transfer!
For the last and final step before your property is officially marked as sold, you will have to set a date with the buyer and their solicitor for the final payment to be made. Before the final payment is made, you should make sure that the property is completely vacated, otherwise the buyer is entitled to vacant possession of the premises.
Once that is done, your commercial property is sold!
Things to be aware of when selling your commercial property
Even with at least two solicitors in the process, sometimes mistakes can still happen if you are not careful, so make sure you keep a note of the things to be aware of during the process. This can include being aware of timescales and potential failures when completing the transaction and will protect you and your company of any losses.
Under normal circumstances, a successful transaction can take up to six to eight weeks to complete, however in some cases it can take even longer. There may be certain factors that can affect the timescales, some factors include how promptly solicitors respond to queries or how quickly buyers can secure finance.
Make sure you prepare yourself for this potential delay, and that you are well prepared with all necessary documents to avoid any further delays to the transaction.
Whether you are the buyer or seller, it is important to keep in mind that either party can walk away from the deal without penalty before the official exchange of contracts is made.
This means you shouldn’t make firm plans that depend on a specific completion date until you've reached this point.
Now that you are fully aware of how selling a commercial property works, you are ready for #TheFinalTransfer of your property. However if you have any concerns in the transfer of titles, you can enlist property solicitors who are specialists in this field of work at The Law House.