Commercial Conveyancing Solicitors

The process of acquiring business premises requires the services of commercial conveyancing solicitors, who will negotiate the lease drawn up by the landlord's commercial conveyancing solicitors.

In many cases, businesses prefer to lease rather than buy premises, and in the case of SMEs the length of a lease may be a deciding factor in whether the premises are suitable.

Large companies are more likely to take a risk on a long lease for their business premises, but it is part of the job of commercial conveyancing solicitors to advise on the viability of any lease and make sure it is as favourable as possible to the commercial tenant.

The process of commercial conveyancing is very similar to that of residential conveyancing, but most property transactions are leasehold rather than freehold.

Commercial leases can be extremely complex and are drawn up by the commercial conveyancing firm representing the landlord (freeholder) of the land or premises being acquired by a commercial tenant for business purposes.

It is also common for businesses to lease a plot of land to build their own business premises, as in the case of new build business parks, where a business might opt for a plot and design its own new build premises. In this case, commercial conveyancing become more complex as planning permission may be needed according.

An incoming commercial tenant may also wish to refurbish or alter the layout or façade of commercial premises and these are factors which commercial conveyancing solicitors deal with.

The clauses a commercial tenant can expect to be included in a lease are:

  • Term of the lease (usually up to 20 years for commercial leases, but may be longer)
  • Premium
  • Rent
  • Contribution to insurances (if any)
  • Service Charges.

Another clause might involve a penalty for relinquishing the lease early if a business decides to move on, so one of the most important clauses in a commercial lease may be a break clause.

Some leases can tie commercial tenants into financial liability if the lease is assigned or the next tenant fails to honour the lease and it is vital that any clauses which place an ongoing legal or financial obligation on a business tenant are flagged up by a commercial conveyancing solicitor before the lease is signed.

Because of the nature of different businesses and the changing economic conditions businesses have to operate in, leasing business premises can be a complex process and using reputable commercial conveyancing solicitors helps companies avoid many of the pitfalls they might encounter if they take on a commercial lease which turns out to be not suited to their changing business needs.

Other issues which need to be clarified regarding a commercial lease include whether the landlord can increase the rent on a commercial property, how often and with how much notice.

Many SMEs find suddenly being faced with an unanticipated rent increase can throw their business into jeopardy in difficult financial times; and commercial conveyancing solicitors can prevent factors such as rent increases threatening business survival in the future by making sure issues such as rent increases are dealt with clearly in the lease.

The same applies to service charges: although service charge payments are supposed to be fair and reasonable and reflect the level of maintenance and services like cleaning which actually take place, unscrupulous landlords sometimes use the service charge to boost income by adding large administrative costs or demanding money up front for repairs or refurbishment which will take place in the future.

All services regarding commercial premises should be agreed in the lease and commercial conveyancing solicitors will ensure that any clauses which may be open to misuse by a landlord will either be negotiated, or will be highlighted before a lease is signed.

Searches, too, are carried out just as in residential conveyancing, as taking on premises close to a new construction which might affect your business adversely in the future is not advisable. This can be crucial in the case of retail businesses, for example, which often suffer decreased footfall once a new supermarket or shopping mall opens up on the outskirts of a town.

Roads being rerouted, refuse tips being built and businesses which may attract anti-social behaviour and leave the façade of your business premises soiled at the weekend or in the evening are all issues which a search by a commercial conveyancing solicitor can reveal to help avoid commercial tenants setting up shop in a neighbourhood which might actually turn out to be detrimental to their business success.

There may also be an agreement regarding subletting the premises, either to other companies within a commercial tenant's group of companies; or even subletting to unrelated companies or individuals, which some companies do to maximise use and profitability of their business premises.

Another issue with business premises which commercial conveyancing solicitors deal with is the small office/home office (SOHO) or businesses which operate from home, either from part of the residential premises or from a separate building in the grounds.

If a home is a leasehold property, this might affect the residential lease held and will most certainly affect council tax charges, public liability insurance if customers visit the business premises. SOHO workers will most likely need to be registered with the local council or need a licence to trade.

If a residential homeowner or lessee decides to convert part of their home into business premises, or wishes to extend your home or buy a new home with a view to running a SOHO business, speaking to a commercial conveyancing solicitor can help avoid any issues which may occur from running a business from home.

As with residential conveyancing, commercial conveyacning will also cover circumstances in which a landlord can regain possession of business premises, including cases of non-payment of rent or service charge, or conducting activities on the premises contrary to covenants in the lease.

Commercial conveyancing solicitors also deal with the assignment of commercial leases and renewal of commercial leases; and commercial conveyancing solicitors are regulated by the Law Society.

Commercial conveyancing, like residential conveyancing, is now moving towards being an online service, which may suit SMEs better as online conveyancing can keep costs down.

However, always check the credentials of any online commercial conveyancing service with the Law Society to make sure the company is registered and operating from a traceable address in the UK, and is a genuine conveyancing firm and not a scam operating from a call centre outside UK jurisdiction.

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