Selling a commercial property? Do your homework first

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Retail shops, strata titled commercial offices, standalone office buildings, industrial sheds, industrial land – these are some of the different kinds of commercial property. Each type has its own features which need to be considered when making the decision to sell.

Not doing your homework can end up costing a seller dearly where a buyer wants to walk away or wants to try a bit of post-contract price negotiation.

Here’s a few examples:-

  1. Always check the lease carefully before going to contract. If the lease gives the tenant the first right of refusal to buy the property and misses out because the seller ignores it and sells anyway, then the disappointed tenant could have a claim against the seller for damages, or even try to prevent the sale from going ahead, depending on the circumstances.
  2. Unregistered easements are surprisingly common, ranging from overhead powerlines to rights of way and customary access rights. These need to be identified and disclosed.
  3. If the property is on the contaminated land register and the buyer doesn’t specifically accept this in the contract, the buyer can usually terminate.
  4. In the standard terms of contracts (aka the fine print), sellers give warranties relating to things such as body corporate matters, outstanding notices to comply with regulations, and other features of the property. 
  5. Telecommunications tower leases protect the rights of telecom companies for infrastructure on a property and provide for rent to be paid to the owner. However, I have seen this rent revenue not being treated clearly in the contract, causing disagreement between buyer and seller.

Are you selling or buying a commercial property?

Sellers and buyers should always plan ahead by getting legal advice before signing a contract. 

At FC Lawyers, our commercial and property team have handled thousands of contracts and can give you peace of mind and sound advice.

Contact our team today to discuss your commercial property needs.

The information provided in this article is for general information and educative purposes in summary form on legal topics which is current at the time it is published. The content does not constitute legal advice or recommendations and should not be relied upon as such. Whilst every care has been taken in the preparation of this article, FC Lawyers cannot accept responsibility for any errors, including those caused by negligence, in the material. We make no representations, statements or warranties about the accuracy or completeness of the information and you should not rely on it. You are advised to make your own independent inquiries regarding the accuracy of any information provided on this website. FC Lawyers does not guarantee, and accepts no legal responsibility whatsoever arising from or in connection to the accuracy, reliability, currency, correctness or completeness of any material contained in this article. Links to third party websites or articles does not constitute any endorsement or approval of those sites or the owners of those sites. Nothing in this article should be construed as granting any licence or right for you to use that content. You should consult the third party’s terms and conditions of use in relation to any third-party content. FC Lawyers disclaims all responsibility and all liability (including liability for negligence) for all expenses, losses, damages and costs you might incur as a result of the information being inaccurate or incomplete in any way. Appropriate legal advice should always be obtained in actual situations.


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