Selling Commercial Property

At Backhouse Solicitors, our experienced commercial property solicitors understand that time is money and we always aim to be the fastest part of any property chain.  Whether you are selling to a third party or transferring personal ownership to your business or pension scheme we will make sure that the transaction is as smooth and quick as possible.

The process for selling a commercial property is not too dissimilar to selling a residential house.  However, with a commercial property transaction there is some extra documentation and more detailed requirements to satisfy, so in the next few paragraphs we outline the main steps in the process.

The “Heads of Terms” document sets out the overall terms agreed between buyer and seller.  Although Heads of Terms are not legally binding and do not commit you to a transaction, they are used to draft other documents and so should be as accurate as possible.

At this point you will need to instruct a solicitor to act on your behalf, which normally requires signing and returning retainer letters and providing identity documents.  The Heads of Terms are sent to your solicitor for review and comment.

You will be provided with Commercial Property Standard Enquiries (CPSEs) to complete.  These are general enquiries about the commercial property you are selling.

Your solicitor will now prepare the pack of paperwork to be sent to the buyer’s solicitors.  This will include a draft Contract, title paperwork, the replies you have given to the CPSEs, together with any other relevant documents.

Once the buyer’s solicitor receives the contract pack, they will work through the information and documents given.  This is known as the “due diligence” process, and depending on the complexity of the documents and the speed of the buyer’s solicitors this process can take a few weeks.

The process may include the buyer obtaining searches (Environmental, Water and Drainage, Local Authority etc) and their solicitor may raise further enquiries with your solicitor depending on the results of the searches.  All enquiries must be answered as accurately as possible, as the buyer will be entitled to rely upon all information you give to them.

Once both parties have returned their signed paperwork, the buyer has paid the deposit (usually 10% of the purchase price) to their solicitor, and a date for completion has been agreed, contracts can be exchanged and the sale is then legally binding.  From this point, neither party can withdraw from the transaction without penalty.

If you have a loan registered against the property, this will need to be redeemed as part of the sale process. Your solicitor will obtain a redemption statement from the lender detailing what must be paid on the completion date, including any early redemption penalties if applicable.

Your solicitor will then make this redemption payment on the completion date once funds are received from the buyer – see 7 below.

In the run up to the completion date, your solicitor will prepare a “completion statement” for you, detailing the money to be received from the buyer and all payment to be made (including any mortgage redemption payments, legal costs, other professional costs such as estate agents and any disbursements).

On the completion date, once your solicitors are in receipt of the completion funds from the buyer, they will confirm that they are dating the signed transfer deed and that the transaction is complete.  They will redeem any mortgage on the property, pay any estate agency fees, their own fees and any other items to be paid as per the completion statement.  They will then pay the net proceeds of the sale over to you the seller.

You will be required to pass on all keys, deeds and any other relevant documents relating to the property to the buyer and the process of selling your commercial property will be complete.

If you are selling a leasehold commercial property, there are some additional stages involved in the sale. Your solicitor will be able to explain this to you.

Our friendly and helpful team of commercial property solicitors are here to help guide you through the sale process with the minimum of fuss.  We are clear and transparent with our fees and will provide you with a quotation that will include a detailed explanation of all the costs and expenses involved.

At Backhouse Solicitors we aim to deliver a top-class service to our clients and are here to protect your interests at every stage. To discuss your commercial conveyancing requirements, contact us today to arrange a free initial consultation with one of our experts.

Tel:       01245 893400
Email:  info@backhouse-solicitors.co.uk
Visit:    17 Duke Street, Chelmsford, CM1 1JU
Or send us a message through the Contact Us page on this website.