At Smith Marston, we provide honest, reliable reports to provide you, as the potential purchaser or lease holder, with the appropriate information to make an informed decision about the purchase and possibly to renegotiate the purchase price.
Why do I need a survey?
Whether you are intending to acquire a leasehold or freehold interest in a property you should seek advice from a chartered building surveyor concerning the condition and construction of the property in question.
When purchasing a house, you are often required by the lender to have the building surveyed to inform you of any items of disrepair or potential liabilities you may inherit once the purchase has been completed. The same applies to commercial property, but often the consequences of failing to have such a survey can be substantially higher. There are a number of types of survey available and these can be adapted to suit your particular requirements.
If you are purchasing the freehold of a building for owner occupation, then it is important that this survey concentrates on costs that would be necessary to keep the building performing throughout your occupation, coupled with ensuring that statutory requirements are met.
You will require advice as to what regular maintenance would be needed and the likely costs involved. You might be thinking of alterations, and thus you may wish part of our survey to focus upon the feasibility of such alterations. We can tailor our survey to your specific needs.
If, as a business, you are considering a sale and leaseback transaction to release capital from your property assets then matters which may normally have been acceptable to yourselves, as a former occupier, in terms of the standard of repairs to buildings, may not necessarily conform to the standard of repairs required under a normal Full Repairing lease.
Any investor wishing to purchase the freehold of your building and then lease it back to you will wish to ensure that, as tenants, you maintain the building in a good standard of repair. These standards often vary between the two parties and it is essential that these issues be considered during such a sale and leaseback transaction.
You may have one or several properties that you are considering disposing of. It is often the intention of the seller to sell the property as quickly as possible so as to release funds for other purposes.
We are increasingly being asked to carry out Disposal Surveys for vendors so that they may assess the condition of their own buildings prior to sale. By doing this, they are fully aware of costs that a potential purchaser may wish to negotiate upon and are better placed to deal with negotiations when these issues arise. A disposal survey can often speed up the whole transaction; if the vendor is advised from the start of the disposal, any future negotiations by a prospective purchaser do not usually come as a shock, at the last minute.
Many people choose to invest their hard earned money in to property investments, relying upon rental income and capital growth over the years as a return on their investment.
However, when buying commercial property, one must be careful to investigate the condition of the property prior to committing to purchase, even if on the face of it, it seems like a great deal. Many property investments are sold already with tenants in place, and, often, the tenants have FRI leases (Full Repairing and Insuring), putting the responsibility for maintaining the building on the tenant.
Problems can arise however when for example, the tenants lease is not assessed, and any Landlord’s obligations under that lease are overlooked. Common problems are:
- A landlord does not assess the costs attributable to the Landlords repairing and decoration obligations, and has to fund works up front before being able to recover monies from the tenant(s) via a service charge.
- Assumptions are made for example that the tenant will have to strip out and reinstate certain alterations. This may not be the case, with the costs of removal falling upon the landlord.
- Inherent defects become apparent, and the tenant is excluded from having to remedy because of a limiting clause in the lease in favour of the tenant, putting the onus on the landlord to remedy.
- Costs for maintaining void areas and common parts in a multi-let property are not considered, thus, service charge income only partly reimburses the landlords expenditure.
A pre-purchase survey will seek to assess the condition of a property, and look advise a potential purchaser of potential pitfalls associated with property defects and maintenance matters that could arise and impact upon the landlords investment.