How to Prepare the Property Elements of Your Business for Sale

May 20, 2022

By Siobhan Williams

Selling your business can become complicated relatively quickly.  The sale of your business may involve selling a property or an interest in a property and this article highlights some aspects that you can sort out in preparation for the transaction to ensure that everything runs smoothly.

A property is often an integral asset in a transaction as it will be a fundamental part of any business.

Preparation and a review of the property information is key as it will identify early on in the transaction if there are any gaps or potential issues in the information you hold about your property.

We have come up with some key things you can prepare early on that will increase the likelihood that the transaction runs smoothly:

CPSEs:

A good place to start will be with the Commercial Property Standard Enquiries or “CPSEs” which are a standard set of questions that answer most of the buyer’s questions about the property.

As the seller, you will be expected to supply replies to CPSEs as part of the contract pack. You should review the questions and consider how to answer them. This may help identify any potential issues that could arise in order that you can try and deal with or mitigate them.

The buyer will likely come back with more questions, but the fewer issues they raise the less impact this will have on the transaction.

Gather your property documents:

The buyer will want to see a number of documents in relation to the property, including:

Title: the buyer will want to see evidence of your title to the property and/or a copy of the lease if you hold a leasehold interest in the property. Depending on the type of transaction and how important the property is, the buyer may want to see some of the underlying documents from when the property was purchased by or leased to you.

Planning Permissions: a buyer will want to ensure that the property has all necessary planning permissions.  Buyers will be specifically be interested in the use of the property and whether it is being used in accordance with any planning permissions.  You should ensure that these are readily available to the buyer or consider how to answer questions about missing planning permissions.

Asbestos Report: property owners or occupiers are required to manage the risk of asbestos in their commercial property.  You will want to check your records to see if you hold a valid asbestos report for your property which will establish whether the property contains asbestos or not.  If you do not have a report, you should consider commissioning one or be able to confirm why one is not required.

Fire Risk Assessment: those responsible for a commercial building will be required to carry out a fire risk assessment.  The fire risk assessment identifies any fire risks at a property and sets out recommendations and action points to minimise the fire risks. You will need to provide this report to the buyer on any sale of the property so should check your records to ensure that you have this to hand, and if not commission one.  You should also consider whether the recommendations and action points have been dealt with and how to answer questions on this.

Identify any gaps:

Reviewing the CPSEs and collating relevant documents early in the transaction will allow you to identify any gaps in information, and any potential issues. It will also allow you time to consider how to deal with potential issues and obtain further documentation.

This will increase the likelihood that the wider corporate transaction runs smoothly and is not delayed by any minor enquiries raised by the buyer in respect of the property. It also minimises the risk of potential price chipping by the buyer if issues come out at a late stage.

If you would like further information about preparing for the sale of your business or a related matter, get in touch with Siobhan Williams via email on swilliams@darwingray.com, or call on 029 2082 9124 for a free, no obligation conversation.

Contact Our Team
Emily Shingler
Associate
View Profile
Heledd Ainsworth
Trainee Solicitor
View Profile
Rhodri Evans
Senior Associate
View Profile
Rich Craven
Solicitor
View Profile
Siobhan Williams
Senior Associate
View Profile
Stephen Thompson
Partner
View Profile

I have worked with Darwin Gray for a number of years and the level of service, professionalism and timely response is second to none. I would highly recommend Darwin Gray to any business.”

Becs Beslee, Dice FM Ltd

Darwin Gray have provided us with a first-class service for many years now. They really take the time to understand our business and develop relationships which results in advice and support that is contextualised and effective.”

Rebecca Cooper, ACT Training

We have worked with Darwin Gray for several years and have always found their services and advice to be first class.”

Karen Gale, Stepping Stones Group

An extremely professional and sincere company who make time for your queries and understand the need to break down certain facts and information to ensure everything is understood perfectly. I would highly recommend the company to anyone looking for any type of legal advice”

Gwawr Booth, Portal Training Ltd

PSS has worked with Darwin Gray for many years. We have always received an excellent service. Prompt and professional advice and support.”

Ledia Shabani, Property Support Services UK Ltd

We have used several departments within DG recently and we have been very pleased with an effective, efficient and down to earth service. Very happy thus far and I expect that we will continue to use DG.”

Guto Bebb, Farmers’ Union of Wales

Darwin Gray offer us truly superb services. Very professional, quick and services available bilingually which is very important to us, highly recommend.”

Iwan Hywel, Mentrau Iaith Cymru

My “go to” in urgent and time sensitive cases for direction, support and advice. The team are quick to respond to calls or emails for advice and support on all matters. Always explain complex matters in a way a lay person can easily understand.”

Margot Adams, Guarding UK Ltd