What Documents Are Required to Sell a Commercial Property?
If you are looking to sell your commercial property, you need to stop and think about whether you know just what is actually involved in the process. Many sellers who start the process through commercial property agents or other companies, especially if it is the first time they have ever sold that type of property, are not always fully aware of all the legalities involved in the sale or the documentation required to satisfy and secure a buyer.
Does that describe you and your experience of selling commercial property? If it does, don’t worry as we have put together this post as a summary and guide to the sales process and the documentation required.
What is the Commercial Property Sales Process?
At the start of the commercial property sales process, a contract needs to be sent to the solicitor of the buyer, along with Land Registry title documents and other documents we are going to discuss later.
If there is a mortgage secured on the property, the solicitor you choose to work with will liaise with the mortgage company so that they can get a redemption statement and check that the amount the property is selling for will be enough to cover the mortgage redemption.
Meanwhile, the solicitor representing the buyer will review the contract draft and the paperwork provided along with it, while undertaking searches on your property and enquiring about the documentation. If the prospective buyer needs a mortgage to buy the property, their solicitor will also need to fulfil any of the requirements by the lender.
The lawyer representing you will reply to all enquiries for you and if the buyer is fully satisfied, the parties can proceed with the exchanging of contracts.
Once contracts are exchanged, the buyer pays the deposit to your solicitor and a completion date is agreed upon. On that completion date, they will then pay the balance to your solicitor, which they will use to pay any sums required for mortgage redemption and take off our fees and the agents fees before sending the rest to you.
Now you have a brief overview of what is involved, let’s look at the documentation required that we referenced earlier.
Documents Required by Your Solicitor
- Replies to CPSEs or Commercial Property Standard Enquiries – CPSEs are a special set of standardised questions that sellers need to answer when selling commercial property. They need to be answered accurately, as buyers are entitled to rely on those responses and if any are inaccurate, you could be sued by the buyer for compensation by misrepresentation.
- Building and Planning Regulations Documentation – Do you have copies of any planning certificates or permissions related to the property? These should also be provided to the prospective buyer. Along with any building regulations certificates.
- Asbestos Survey – If your commercial property was built in a certain period, you are legally obligated to arrange for an asbestos survey and provide an ongoing plan of management.
- Energy Performance Certificate – It is normally the commercial property agent that will provide the EPC for the property to the buyer along with other marketing materials. It is good practice to provide your solicitor with a copy too, that they can pass on to the solicitor representing the buyer, as this could help speed up the process a little.
- Fire Risk Assessment – It is important that if you own and are responsible for commercial property that you submit to regular fire risk assessments and can provide evidence of this to a potential buyer.
In addition to the above, other documents may be relevant to your commercial property and the sale process, such as
- Health and safety records and files
- Air conditioning repairs and maintenance records
- Gas and/or electrical testing certificates
- Business rates and other costs the potential buyer would be liable to pay as the new owner of your commercial property.
It is best to provide as much of this as you possibly can as soon as you can in the sales process to avoid delays.
Of course, if you want to avoid the headaches and stress of dealing with solicitors and all that paperwork, you could sell your commercial property to cash property buyers like Cash Home. They take care of the legalities and documentation side of the process and will buy your property with cash, meaning you have access to the funds quicker and easier.