Commercial Property.

A commercial property purchase typically takes between six and twelve weeks from agreement of heads of terms to completion, though complex transactions can take considerably longer. The timeline depends on the nature of the property, the extent of due diligence required, whether the property is tenanted, the complexity of title and planning issues, and how quickly the parties and their advisers respond. Transactions involving development land, environmental concerns, multiple tenancies, or financing arrangements take longer. Unlike residential transactions, there is no chain in the conventional sense, but the due diligence process is more extensive. Setting a realistic timetable at the outset — and agreeing it in the heads of terms — helps keep the transaction on track.

A commercial landlord has several remedies for non-payment of rent. These include: forfeiting the lease (ending it and recovering possession), where the lease contains a forfeiture clause and the correct procedure is followed; using the Commercial Rent Arrears Recovery (CRAR) procedure to seize and sell the tenant's goods to recover the arrears; drawing on any rent deposit held; pursuing any guarantor or former tenant who remains liable; and issuing court proceedings to recover the debt. Each remedy has its own requirements and consequences, and some are mutually exclusive — for example, taking certain steps can waive the right to forfeit. The right remedy depends on the circumstances, including the amount owed, whether the tenant is likely to pay, the value of the lease, and whether the landlord wants to keep or remove the tenant. Taking legal advice before acting ensures the landlord chooses the right remedy and does not inadvertently lose other rights.

Commercial conveyancing is the legal process of transferring ownership of commercial property — offices, shops, industrial units, land, and investment property. While it shares the basic framework of residential conveyancing, it is considerably more complex. Commercial transactions involve more detailed due diligence, more significant tax considerations including VAT and capital allowances, more complex title and planning issues, and frequently the transfer of existing tenancies and commercial leases. The parties are usually businesses rather than individuals, and the contracts are negotiated rather than based on standard residential forms. There is also far less statutory consumer protection — the principle of caveat emptor (buyer beware) applies more strongly, placing the onus firmly on the buyer to investigate the property thoroughly before committing.

Commercial landlord and tenant law governs the ongoing relationship between landlords and business tenants throughout the life of a lease — from the operational obligations of each party, through the management of issues that arise during the term, to the enforcement of the lease and its eventual end. It covers: the respective obligations of landlord and tenant; the landlord's remedies for non-payment of rent and other breaches, including forfeiture and the CRAR procedure; rent deposits and guarantees; consents for assignment, subletting, and alterations; dilapidations at the end of the term; and the handling of tenant insolvency. It overlaps with — but is distinct from — the law on granting commercial leases and the statutory renewal regime under the Landlord and Tenant Act 1954. Both landlords and tenants benefit from understanding their rights and obligations, and from taking advice when issues arise rather than after they have escalated.

If a borrower defaults — by failing to make payments or breaching other terms of the facility agreement — the lender has a range of enforcement options under its security. These include: appointing a receiver (often a fixed charge or Law of Property Act receiver) to take control of the property, collect any rental income, and sell it to repay the debt; exercising the lender's own power of sale to sell the property; where a debenture with a floating charge is in place, appointing an administrator over the company; and pursuing the borrower personally for any shortfall, and any guarantors under their guarantees. The lender must act in accordance with the terms of the security documents and its legal duties — including, on a sale, a duty to take reasonable care to obtain the proper price. A borrower facing default should take legal advice urgently — early engagement with the lender may allow a restructuring or refinancing that avoids enforcement.

A commercial lease is a legally binding contract under which a business tenant occupies premises owned by a landlord for a fixed term in return for rent. Commercial leases are usually long, detailed documents that are heavily negotiated — unlike residential tenancies, there is little statutory protection and the terms govern the relationship. The key terms to understand include: the term (length) of the lease; the rent and how it is reviewed; repairing obligations — who is responsible for maintaining the premises; the service charge; rights to assign or sublet; break clauses allowing early termination; and whether the lease has security of tenure under the Landlord and Tenant Act 1954. Because a commercial lease commits a business to significant ongoing obligations, often for many years, taking legal advice before signing is essential.

A Section 106 agreement — made under Section 106 of the Town and Country Planning Act 1990 — is a legal agreement between a developer and the local planning authority that imposes planning obligations as a condition of planning permission. These obligations are intended to make a development acceptable that would otherwise be refused, by mitigating its impact. Common Section 106 obligations include: provision of affordable housing; financial contributions towards local infrastructure, schools, or transport; provision of open space or community facilities; and restrictions on how the development is used or occupied. Section 106 obligations run with the land and bind successive owners. They can represent a significant cost and constraint on a development, and the terms are often heavily negotiated with the planning authority. A developer must factor Section 106 obligations into the viability assessment for a scheme — they can materially affect whether a development is profitable.

A Section 25 notice is the formal notice a landlord serves to bring a business tenancy to an end under the 1954 Act. There are two types: a friendly notice, which proposes terms for a new lease; and a hostile notice, which states that the landlord opposes renewal and sets out the statutory ground relied on. The notice must specify a termination date, which must be between 6 and 12 months ahead and not earlier than the contractual expiry. If you receive a Section 25 notice, act promptly: the notice triggers time limits within which you must respond to protect your renewal rights, and if the landlord is opposing renewal, you may need to apply to court before the termination date to preserve your position. Do not ignore a Section 25 notice — take legal advice immediately, as missing a deadline can cost you the right to renew.