While it is possible to purchase commercial property on a freehold basis, whether this is the best option for you or your business will depend on your current situation. Freeholds on commercial properties are typically owned by landlords who lease out their properties to businesses, such as office spaces, in return for rental income from their business tenants. Most businesses, however, typically prefer the flexibility and limited initial investment that leasing a commercial property allows.
Commercial Property
While it is technically possible to convert a residential property into a cafe, there are a large number of legal requirements that must be met for this conversion to be successful. You will need to apply for (and successfully receive) a premises licence from the local council and obtain Food Business Registration with the Food Standards Agency alongside the successful completion of a range of other legal paperwork.
For help with purchasing a commercial property, it is always helpful to have a solicitor with experience in commercial conveyancing on your side. The conveyancing process of buying a commercial property is different and, in some ways, more complex than buying a residential property, so experience in this area is crucial. You can get in touch with our network of skilled commercial solicitors and find out more here.
An easy way to tell whether a property is commercial or residential is to work out what the building is currently being used for. Typically, properties used for business purposes, such as restaurants, banks, offices or shops, are classified as commercial properties. Residential properties, on the other hand, include houses and flats where people live. For more detailed information on a specific property, you can search for property details and purchase specific documents relating to a property on the Government Land Registry website here.
The time it takes to secure a commercial lease will typically vary depending on its complexity, ranging from a few weeks to several months. Each leasing situation is unique, and the duration can vary wildly depending on the individual circumstances you face in obtaining your lease.
The amount you are quoted for securing a commercial lease will depend on the complexity of the lease, the lease’s value and term length.
To buy a commercial property, you will need to find a suitable commercial property for sale and then have an offer accepted. Once your bid is accepted, you will need to go through the commercial conveyancing process with the help of a commercial solicitor or conveyancer. This is the legal process required to buy a commercial property, which involves the transfer of paperwork, the completion of searches, and finally, the exchange of contracts. Once this process is complete and you pay for the property, either outright or as part of a financial arrangement such as a mortgage, you will then be able to complete your purchase of the property.
Both residential and commercial properties can be great investment options, depending on your investment goals. Investing in commercial real estate can grant higher returns on a long-term basis, but it is usually more expensive and can be more difficult for inexperienced investors in this area. While residential properties typically grow in value more slowly, they are easier to manage than commercial properties and provide a steadier rental cash flow, especially in the short term.
While typically residential properties are used for living in and commercial properties are solely classified as places of business, there are situations where buildings contain both residential and commercial tenants - making the building ‘multi-use’.
However, usually choosing to live in a commercial property will constitute a violation of the terms of its commercial lease. To gain the proper permissions to do this, the property type will need to be changed to a residential property, which will require obtaining planning per
Commercial lawyers typically cover legal areas relating to businesses and corporate activity. They may offer advice or represent businesses in court and can also represent employees in disputes relating to employment law.