When selling commercial property, it is important to seek legal advice first. Every business knows the importance of ‘buyer beware’ when purchasing a commercial property. But it’s also vital to meet certain legal obligations when you’re the vendor.
Otherwise, the buyer might have grounds to cancel the deal or take legal action.
The vendor is required to disclose all material facts to the buyer. This is a subjective standard, which is why it’s important to get expert advice from a commercial property lawyer when selling commercial property.
Rules vary from state to state, but you might need to disclose whether the property:
-
Has any unregistered easements (e.g. overhead power lines)
-
Is contaminated or contains asbestos
-
Has structural problems
-
Is subject to any authority notices
-
Is prone to flooding or is in a bushfire zone
-
Contains any mining tenements or graves
You might also need to disclose whether:
-
Other parties are allowed to use the land (e.g. telecoms or government agencies)
-
The tenant has first right of refusal to buy the property whenever it gets listed for sale
Finally, you might need to disclose the property’s zoning status.
Whenever transacting, it’s always good practive to do your best to find out what you don’t know. That’s easier said than done. However, as a general rule, you should speak to the professionals with whom you have existing relationships such as your mortgage broker, accountant, financial planner and, if you have existing dealings wiht a lawyer, consult with them before making any moves. This way you’ll be sure to uncover what you don’t know before it’s too late. So don’t be afried to ask as many questions as possible.
As always, contact us to discuss any commercial property transactions.