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As a business owner, it's crucial that once the decision to sell your business premises has been made that you have taken all necessary steps to ensure you have all of the mandatory property management documents in place.
Here are key considerations and requirements to ensure a swift sale:
1. Essential Documents
Even before enlisting a property agent to sell the property, the seller should gather all relevant documents concerning the property. These may include:
Title deeds and land registry documents – including evidence of any informal arrangements that you have made with any third parties.
Leases, tenancies, licences and other agreements with third parties (if applicable).
Planning Permissions and satisfaction of all Planning Conditions, Building Regulation with Certificates of Completion, Explanations covering any breaches or failures to obtain consent.
Maintenance Records and warranties for any plant and machinery.
Certificates of compliance – ensuring these are in-date and any recommendations have been addressed –
-Fire risk assessment
-Electrical Installation Condition Report (EICE)
-Gas Safe reports
2. Obtain an Energy Performance Certificate (EPC)
EPCs are legally required in order to sell commercial properties. The seller must obtain a valid EPC from an accredited assessor before marketing the property. EPCs are valid for 10 years and once obtained are logged in the ‘Find an energy certificate – GOV.UK’ website.
From 2028 all commercial premises must have a minimum rating of ‘C’.
If selling residential investment property the minimum rating must be ‘E’ or above, from December 2025 this is due to change to ‘C’ and above for newly rented properties and existing tenancies will need to meet the requirements by 2028.
EPCs also set out the recommendations to improve the rating, whilst these are not costed it does help buyers/valuers consider the impact on the asset value.
3. Consider Additional Statutory Documents
Depending on the property's characteristics and location, the seller may need to provide additional statutory documents to potential buyers. These may include:
Asbestos survey report
Flood risk assessment
Environmental impact assessment
4. Conduct Property Inspections
It's advisable for the seller to arrange professional inspections of the property to identify any potential issues or defects. These inspections may include:
Structural survey
Electrical and plumbing inspections
Roof and drainage inspections
Pest control inspection
Inspections of plant and machinery e.g. air conditioning and sewage treatment plants
5. Shared or Common Items – Service Charge
If the Property shares amenities such as access, car parking, services with other properties these may be managed by a separate management company. Collect:
Copies of Management Company receipted invoices
Copies of Last three years management accounts
Details of any sinking funds
Details of any specific requirements of the management company such as shareholders certificates.
Addressing any identified issues proactively can help streamline the sale process and avoid delays or complications. This will also keep costs in-check.
6. Review and Comply with Lease Agreements
If the property is subject to lease agreements, the seller should review the terms and conditions carefully. They may need to obtain consent from the leaseholders or provide relevant notices as per the lease agreements. The Buyer will want evidence that rents and services charges are paid up to date and that any rent reviews have been settled.
By following these steps, the seller can ensure that they are well-prepared for the sale of their business premises. Having all the necessary documents and information readily available will not only facilitate a smoother transaction but also demonstrate transparency and compliance, which can be attractive to potential buyers and their lenders.
Contact Harshinder Hundal at FG Solicitors today on 0808 172 93 22 or complete our quick contact form for a no obligation discussion!
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This update is for general guidance only and advice should be taken in relation to a particular set of circumstances.
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