How much do you charge for Commercial Property services?
The Gorvins Commercial Property team covers a wide range of real estate services. Depending on the service you require will determine the cost e.g. a lease agreement will be a different cost to a commercial property purchase. Please contact us on 0161 930 5151 to discuss your requirements.
Do I need to pay Stamp Duty on Commercial Properties?
If you’re purchasing commercial property and the cost is between £150,000 and £250,000, Stamp Duty of 1% is charged on the whole of the purchase price. This increases to 3% of the total purchase price if the cost of the property is between £250,000 and £500,000. 4% is charged on commercial properties costing £500,000 or more.
If you’re leasing your property, the amount of SDLT depends on how long your lease is and the amount of rent you’ll pay per year. Our commercial property solicitors can calculate your exposure to SDLT before you sign your lease so you know what is payable from the outset.
Can I end my commercial lease agreement early?
A lease is a legally binding contract, drawn up to protect both you and your landlord. If you don’t have a commercial lease break clause in your tenancy agreement, you can ‘sell’ your lease or surrender your lease to the landlord. Both options may have financial repercussions for you, so speak to our commercial property lawyers about your personal circumstances.
Can Gorvins act for landlords in commercial lease negotiations?
Yes, we can act for both landlords and potential leaseholders in lease negotiations. Contact our commercial property team to discuss your options.
What is a break clause and what should I look for?
A break clause is an option for you and/or the landlord to terminate the lease early. For example, you might negotiate a 20 year lease on the premises, but with the option to terminate the lease after four years if you choose to.
Key considerations include:
- Whether the break clause gives you the flexibility you want. In the example above, after four years you will no longer have the right to break the lease for the remaining sixteen years.
- What notice you need to give if you want to exercise your right to terminate the lease.
- Whether there are any penalties attached to exercising the break – for example, a break payment.
- Whether there are any other conditions attached. Commonly, leases give the landlord the right to refuse to allow the break if you are in breach of the lease in any way, however minor.
You should be wary of any break clause in favour of the landlord, which could allow the landlord to terminate the lease early against your wishes.
At what point in the negotiation does the deal become legally binding?
All aspects of the deal will remain negotiable until you exchange contracts. At that point, the contract is binding on both you and the landlord. You pay Stamp Duty Land Tax and other fees, including any land registry fees, at the completion date when you take over the premises. If the premises are ready to be occupied straight away you may enter into a new lease without any prior contract.
How do rent reviews work?
Rather than setting a fixed rent for the entire term of the lease, most leases (particularly longer leases) include rent reviews which allow the rent to be adjusted periodically. The terms of the lease will set out how the rent reviews work, including when rent reviews will take place (eg every three years) and how the new rent will be calculated. The lease will usually also specify what notice the landlord must give you of the new rent and how disagreements will be resolved.
Most leases base the new rent on the ‘open market rental value’ at the date of the rent review – ie the rent the landlord could reasonably expect to receive if the premises were leased on that date to a third party, on similar terms to those in your lease. Some leases link the new rent instead to the Retail Price Index.