Selling a Business Centre

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Throughout the UK you will be able to find leasehold and freehold business centres, which generally are commercial properties that provide office space to companies, sometimes single unit properties with shared facilities and others being several buildings on a large estate. This guide provides tips on how to sell your business centre for a competitive and swift offer.

1. What type of property is a business centre?
2. Reasons why buyers may want your business centre
3. Factors that can complicate selling a business centre
4. Fixing a problem business centre before selling
5. Capital Gains Tax and the sale of your business centre
6. Four methods for how to sell a business centre
7. Frequently asked question about selling a business centre

What type of property is a business centre?

Business centres can be found across the UK and they are all generally defined as commercial properties, but there are variations in the size of the properties and their features.

You might own a business centre that is a large estate covering thousands of square feet with several different buildings, all housing their own offices. Or perhaps your business centre is smaller in scale, such as one property mentioned on Investeastyorkshire.co.uk in East Yorkshire that offers just four workshops and shared necessities such as kitchens, toilets and more.

Whatever the size and scope of your business centre, it will generally be defined as a commercial property. More specifically, business properties typically fall within the "Business" class of property as defined by the UK Government Town and Country Planning (Use Classes) Order 1987. Note however that this does not apply to financial and professional services which fall under another use class.

Your business centre might be freehold, where you own both the buildings on the land as well as the site itself outright. Alternatively, it could be leasehold, in which case you own the property for a specific number of years in exchange for paying the freeholder an annual ground rent.

Regardless of the size or type of your business centre, and even if it has some kind of structural damage or another issue that makes it a "problem property, " if you’re ready to seek a buyer for it then this guide provides much useful information. It includes details on factors that may make a sale harder or easier, as well as tips on the best way to attract a competitive and speedy offer from a buyer, including four different methods for how you can try to sell your property.

Reasons why buyers may want your business centre

When you’re ready to sell your business centre, it can be useful to know some of the reasons that make this type of commercial property attractive to potential buyers. There are some factors you cannot change, but you can focus on talking up the beneficial issues to anyone interested in making an offer.

Popular location: Many companies like to be situated in high demand areas such as major cities, so if your business centre has an enviable location then it could be easier to sell.

Plentiful parking: The vast majority of workers using a business centre will drive to the office, so the more accessible parking your property has, the more buyers may be interested.

Useful amenities: If your business centre has a number of beneficial amenities for the people working there, such as dedicated kitchen or relaxation spaces, it could possibly sell faster.

Factors that can complicate selling a business centre

Just as it can be helpful to know some of the elements that may make prospective buyers view your business centre (Defined here in the Cambridge dictionary) more favourably, the same is true of understanding all the potential negative factors.

Some of the below elements might be beyond your control, whereas others you could have the potential to fix, such as structural flaws with the property. If there is any kind of problem with the business centre then you must disclose it to anyone who shows an interest in making an offer on your property. Withholding information about structural flaws at your property can result in you facing major penalties if someone buys it, discovers the problem, and then sues you.

Structural problems: A major hurdle to selling your business centre could be if it has a prominent structural problem, which can be anything from dry rot through to subsidence.

Bad location: If your business centre is in a very remote location or has poor parking options, or even both, then you might find that potential buyers will not be that interested in it.

Lack of amenities: Another factor that might turn off some buyers is if the business centre has few amenities, for example if several offices all have to share the same toilets.

Fixing a problem business centre before selling

It’s possible that you freehold or leasehold business centre might have some type of structural problem, which can include dry rot, subsidence, high levels of asbestos, and more. You’ll have to decide between fixing the problem before selling or seeking a buyer for the property "as is. "

One approach is to invest money, effort and time in repairing the problem before you attempt to sell the business centre. The benefit of doing this is that it eliminates the scenario where a potential buyer might see the problem and reduce their offer price by what they estimate it will cost them to fix the issue if they become the owner of the property, which would likely result in you making significantly less profit on the sale of your business centre.

But many business centre owners will not have the resources available, whether that’s funds, effort or time, to commit to what might be a lengthy and expensive repair project before selling.

Thankfully, there are still ways that you can obtain a quick and competitive offer for your business centre even if you need to sell it as is without addressing any problems with it. Your best choice is likely contacting a quick property buying company like LDN Properties, because they make fair and speedy offers to but almost any type of commercial and other property, with the promise that you’ll still get a competitive price even if it has a major structural flaw.

Capital Gains Tax and the sale of your business centre

If you’re able to sell your business centre, you will need to assess whether you might have to pay the UK government a share of Capital Gains Tax from the sale proceeds.

This is a fee that applies to any tangible and valuable asset such as property, vehicles, luxury goods, artwork and more and is charged based on the profit that you might make from the sale compared to the original price at which you purchased the asset. Note that the tax is levied on the amount of profit, also called the gain, that you could earn from the sale and not the overall property sale price.

In some situations you might be able to avoid having to pay any Capital Gains Tax, or at least pay a reduced amount, so you should consult with a financial professional about these options. And if you only break even on the sale, meaning the sale price is roughly what you paid for it, or you make a loss by selling far below your purchase price, then this tax will not be charged.

Four methods for how to sell a business centre

As you prepare to sell your leasehold or freehold business centre, you should review your four typical options for how to find a buyer, and learn about their potential strengths and weaknesses.

Typically, property owners will need to choose from selling to a quick property buyer, selling with an estate agent, selling via an auction or selling without any help. Some of these methods have strong benefits, like the fact that quick property buyers never charge any commission. Other choices have noticeable drawbacks, like selling on your own often taking more than a year.

Selling to a quick property buyer

One of the main reasons for selling to a quick property buyer is the sheer speed at which they can purchase your business centre, because they can generally complete the process – and that covers all steps including exchanging contracts and paying you the proceeds – within weeks. It makes selling to a quick buyer often by far the speediest of the options.

These companies, such as LDN Properties which was founded in 2003, are able to complete the buying process so quickly because they have the financial resources to buy properties straight away, they don’t have to wait for months to first get approved for a mortgage.

An additional advantage of selling to a quick buyer is that the genuine companies will never make you pay any commission, so you can count on receiving the full proceeds. That makes using a quick buyer the perfect choice if you are trying to reduce your overall selling costs.

LDN Properties and other quick buyers are also renowned for making competitive offers to buy properties even if they have structural defects or some other issue that other buyers might consider to be deal breaking problems. For example, LDN Properties has a long list of varied property purchases from around the UK that includes flats with leaks, uninhabitable properties, homes that don’t have Fenestration Self-Assessment Scheme certificates, houses with infestation, flats with a Section 20 notice, properties with a regulated tenancy, homes that have a bad roof, properties with extensive damp problems and many other examples.

Selling to a quick property buyer is also an incredibly stress-free, simple and no-hassle method. It starts when you call the company to ask about selling your business centre. You should be giving a tentative price offer within an hour, and then you’ll have at least a week to consider it.

If you accept the tentative offer, the quick buyer will usually then send one of their representatives to your property in order to inspect the interior and exterior before the company makes a final offer. This should be the only time that you have to accept a viewing, compared to selling via an auction or estate agent where you might have to endure many viewings.

Should you accept the quick buyer’s final offer, they’ll then work swiftly with your solicitor to sign all of the required legal paperwork and complete the other mandatory steps. Typically they can complete the purchase in just a handful of weeks, with minimal effort needed on your part.

You can also get extra peace of mind when selling to a quick property buyer by asking companies if they are registered with The Property Ombudsman (TPO). This independent organisation writes rules that all members must follow which protect property owners from being defrauded by quick buyers. Ask individual companies if they belong to TPO, and if they do then this should give you assurance that you can trust the sale of your business centre to them.

It’s fast, free and easy to check the membership status of any quick buyer by visiting TPO’s website and then clicking on the "Find a Member" button on the left of the screen, and then typing in the name of a company. If they are truly registered with TPO, like LDN Properties, then you will be able to see their full membership details. If a quick buyer cannot prove it is a TPO member or tells you they refuse to join, don’t sell to them because this might be a scam.

Selling with an estate agent

A benefit of selling through an estate agent is that it will be their responsibility to do the vast majority of work in finding a buyer. This includes developing a listing that describes your business centre and features photographs of the interior and exterior, advertising that listing in their office, online and in local newspapers, organising viewings for prospective buyers to tour the property inside and out, and hearing offers, hopefully taking one to exchange of contracts.

Although this saves you a lot of time and stress, estate agents expect to be paid for this work often based as a percentage of whatever sale price they are able to get for your business centre. If one of your main aims when selling the property is not paying any fees then you should look at other options.

This is also not necessarily a very rapid way to sell your business centre, because you might be waiting more than a year before you get a serious offer. And even if someone does make an offer, they can cancel it without penalty anytime up until just before contracts are exchanged.

If that happens then it will simply add many more months to the selling schedule, because at that point you’ll need to start over with trying to find a buyer for your business centre.

You should understand that some estate agents may try to trick you by quoting a very high potential sale price for your business centre, even if they realise that buyers will only be interested at a much lower price. Their reason for secretly doing this is that they hope to the high price quote will persuade you to sell using their services, which in turn means that they will be able to profit from the commission that they’ll charge you if they find a buyer.

But you can take some simple steps to avoid falling for this trick, starting by looking on property sales websites like Rightmove or Zoopla and writing down the current and past sale prices of business centres that are similar to yours. Then ask several more estate agents to give you free quotes for the price at which they think your property will sell. Finally, calculate the average of all of these prices and this should produce a figure that likely represents a much more realistic estimate of your property’s possible sale price.

Selling via an auction

You may also be thinking about selling your business centre through an auction, where people will get to place bids on the property. The winning high bid at the end of the auction will be the winner, and this is a binding sale they can sue to enforce if you try to walk away from it.

That’s why you need to choose a reserve price – the cheapest value at which you can accept selling your business centre – that will hopefully still produce some profit from the sale even after you have paid the auctioneer their fees for selling your property. This commission is often charged as a percentage of whatever sale price you’re able to get for the business centre, and this will increase your selling expenses because the fee is deducted from the final sale proceeds.

It’s possible that some auctioneers might be open to reducing their commission rate or having the buyer pay some of your selling costs, so ask individual companies if this is feasible.

Selling at an auction is not a very speedy method, because there are several delays involved with the process. You can expect a wait of many weeks or even months between when you enter the business centre for sale and when the auction happens. And even if your property sells, the buyer typically has 28 days to sign their required legal documents and complete all of the other required steps before the sale of your property is considered finalised.

Some auctioneers might give buyers even more than 28 days whilst others could set shorter deadlines, so inquire with companies about whether setting a tighter deadline is possible.

Selling without any help

Often the most stressful way of selling a business centre is doing it yourself, which means getting no help from a third party such as an estate agent or auctioneer. That puts the burden on you to create and advertise a listing, organise viewings and hear offers from buyers.

It’s a massive amount of work and this won’t be something you can just do whenever you have free time, and typically it can take over a year before you find a buyer this way. That’s why you should only consider pursuing this option if you have a friend or family member with property selling experience who can help you for free, or if you already have that experience.

Otherwise, the only clear advantage of selling without any help is that you will be required to pay anyone commission, which can help to reduce your selling expenses. But the costs involved in advertising your listing could easily eliminate any savings you make by not paying fees.

If you are determined to avoid commission on the sale of your business centre, you could instead consider selling to a quick buyer like LDN Properties. These companies commit to never charging property owners any fees, and their usual timeline for buying a property is just a few short weeks, so you would not only get a zero-commission sale but also a speedy one.

Top queries and answers about selling a business centre

Property owners and investors thinking of selling quickly usually have some questions to be answered, ranging from the types of property we can buy through to how to sell an office building. Here are a few questions we’re asked about selling a business centre: