Any advise on buying a shop lease? - HotUKDeals
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Any advise on buying a shop lease?

EBT Avatar
6y, 6m agoPosted 6 years, 6 months ago
Im very close to buying the lease on a shop. 6 years left on the lease. Is there anything I need to make sure I do/ask ect, its a cob shop by the way. I am in catering already but never had my own place so to speak.
EBT Avatar
6y, 6m agoPosted 6 years, 6 months ago
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#1
check to see who is responsible for repairs/upkeep of the property - my lease made me responsible for all repairs inside and I have to paint the outside every 2 years - ensure there is a get out clause after the first year or two also
#2
Don't forget to ask if their are any maintenance charges you are responsible for

Dave
#3
I really would recomend you get solicitors advice, there are many pit falls particulalry with repairs as others have mentioned. Check the insurance clause, whether you have rights of renewal (if that's what you want) etc.
#4
find out about rent reviews, how often, are they upwards only, who is responsible for inside repair and outside repair etc
#5
its made difficult as the property owners live abroad therefore i cant see them to talk to, the current lease holder has been there 4 years and is basically sorting everything out. I will defo ask about repairs thats one I had forgot about thank you. i take it I have the right to look at some kind of accounts/books before i sign my life away lol!!
#6
I deal with leases day in day out. I dont invest much in resedential, I am a commercial landlord.

If you dont have experience with with lease I would recommend speaking to a professional. I presume the orignal lease was over 7 years and therefore must have been registered and you are just taking it over as a license to asign or sublet.

If you are trading as a ltd negotiate with the L and try not to give any personal gurantees. Covenants to look out for:

1. Rent reviews.
2. Rent free period (usually applicable for new leases)
3. Personal gurantee if ltd status.
4. FRI convenants.
5. Insurance premium.

As a matter of goodwill I am willing to give you free advise. Any questions ask.

* Free advise to a resonable number of questions.
#7
EBT
its made difficult as the property owners live abroad therefore i cant see them to talk to, the current lease holder has been there 4 years and is basically sorting everything out. I will defo ask about repairs thats one I had forgot about thank you. i take it I have the right to look at some kind of accounts/books before i sign my life away lol!!


You're not buying the business, you're buying the Lease?
#8
fileeds
You're not buying the business, you're buying the Lease?


It wouldnt make any difference to the lease.

OP said "6 years left on the lease", good to presume, lease is being transferred.
#9
aston_martin_own
It wouldnt make any difference to the lease.

OP said "6 years left on the lease", good to presume, lease is being transferred.


Then there would be no need to look at the books/accounts then, wouldn't you agree, hence the query? Buying a commercial business with a lease in place would mean look at the books/accounts as well as the lease, buying a lease on a commercial property on its own is down merely to the document itself.
#10
Just read it again and seems like OP is buying a business TOGC. You would need to understand what you are comitting to. Are you using any business transfer agents? Where was the business listed?

Not scare mongering but a lot of people commit to things they dont know and end up in a lot of costly trouble.

Make sure you understand what you are doing.
#11
Sorry yes just buying the lease it was originaly bought for ten years and I believe it has about 970 years so more years can be bought. The person who has the lease now is just being a bit iffy about the takings, he doesnt want me to stand in the shop for a couple of days to see the trade for myself and he owns another shop and says his books are put together for both businesses which doesnt sound right to me, the amount he is telling me its doing just sounds too much!
#12
fileeds
Then there would be no need to look at the books/accounts then, wouldn't you agree, hence the query? Buying a commercial business with a lease in place would mean look at the books/accounts as well as the lease, buying a lease on a commercial property on its own is down merely to the document itself.


Buying a leasehold business would be different. It would be classified as a TOGC and current owners have a right to waive exemption but depends on the present owners.

You need to understand TUPE and all the relevant laws and carefully understand the documents. I can give proper advise if OP gives us a little more idea about the business.

Type of business,
Turn over,
Empoyees

Etc etc
#13
aston_martin_own
Buying a leasehold business would be different. It would be classified as a TOGC and current owners have a right to waive exemption but depends on the present owners.

You need to understand TUPE and all the relevant laws and carefully understand the documents. I can give proper advise if OP gives us a little more idea about the business.

Type of business,
Turn over,
Empoyees

Etc etc
#14
EBT
Sorry yes just buying the lease it was originaly bought for ten years and I believe it has about 970 years so more years can be bought. The person who has the lease now is just being a bit iffy about the takings, he doesnt want me to stand in the shop for a couple of days to see the trade for myself and he owns another shop and says his books are put together for both businesses which doesnt sound right to me, the amount he is telling me its doing just sounds too much!


MODS: I am not selling anything. Its free advise.

EBT: You should drop me an email, I just dont like to type too much on an internet forum.
#15
EBT
Sorry yes just buying the lease it was originaly bought for ten years and I believe it has about 970 years so more years can be bought. The person who has the lease now is just being a bit iffy about the takings, he doesnt want me to stand in the shop for a couple of days to see the trade for myself and he owns another shop and says his books are put together for both businesses which doesnt sound right to me, the amount he is telling me its doing just sounds too much!


If a lease was orignally for 10 years how can it have 970 years left? I think you are taling about a virtual freehold which usually accompnies peppercorn rent.
#16
aston_martin_own
MODS: I am not selling anything. Its free advise.

EBT: You should drop me an email, I just dont like to type too much on an internet forum.


Messaged you, thanks.

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