Commercial Property Conveyancing is quiet different from residential property conveyancing. As well as different legislation commercial properties are often subject to complex commercial leasing contracts which have an effect on what the owner of the property is allowed to do.
Commercial Lease Contracts can also include a ‘first right of refusal’ clause which allows the tenant to have first right of refusal to purchase the property at the owners reserve price. Depending on how the clause is written the tenant may have to be consulted well before the property being put on sale and even kept informed during the sale process to give them the opportunity to purchase at any reduced price.
The sale documents that a conveyancer must prepare for a commercial property are much different to a residential conveyance. In addition to including the copy of a lease (if there is one) the documents are usually much more detailed. The fittings and fixtures of a large commercial/industrial property can be extensive and it’s not unusual for a tenant to have substantial investment in their own fittings. It may be difficult for the purchaser to distinguish between what goes with the property and what belongs to the tenant. Upon vacating the premises the tenant may have responsibilities which are unusual or illegal in a residential lease. The tenant may have to make good, including, repainting, re-carpeting, repairing, removing fittings and making good any damage caused in the removal. There can be many thousands (or hundreds of thousands) of dollars to be spent when a tenant moves from a commercial property, knowing who has to pay for what can make a significant impact on the owners bottom line and therefore the value of a commercial property.
We suggest seeking a professional commercial conveyancer when considering selling or buying commercial property.