What Does 'under Offer' Mean???

qwertyford

I'm unfortuante to have been in two similar situations to what I'm in now. I've found two properties and effectively lost both of them because I haven't been quick of the mark. Worse thing is they've both been empty for over a year.

Alan_M_2

AndrewSmith wrote:

I have to agree Alan,

In my local undercover shopping arcade there have been the same two retail units empty for over 2 years now except for the annual influx of 'cheap and nasty' christmas shops selling rubbish.

Surely it would be more beneficial to lower the rent and have the place occupied? It also creates unease with the remaining tennants as empty units make the centre less appealing.

I'm not sure what the answer is, there's a couple of industrial Estate not far from where I am now, and I'd be surprised if either of them are operating at more than 50% occupancy.

The agents claim the buildings are "Worth" what they are asking, but business unlike domestic property isn't so emotional about what it needs and what it will pay.

I was trying to get this across to the wide neck tied 20 something agent in his Mini Cooper, it wouldn't matter if I was turning over £200 Million a year, there is no time at which I can afford to pay £10/£12 sq/ft to store my stock, the two lines never converge.

The next tack He took was suggesting I bought it, so out of curiosity I asked how much it was freehold. - £1.2m.....I just burst out laughing at that and He looked mortified, a 6000 sq/ft warehouse, one roller shutter door, no offices with B8 planning (warehousing and distribution) £1,200,000. :rotfl:

AndrewSmith

Yes don't we all love those kipper tied 20 something EA's. You are right about the obligatory Mini Cooper too.

What surprise me though is that there are no shortage of new industrial developments being built. Mind you I suppose the travellers have to park their caravans somewhere other than the local school field.

I am always amazed at the 'value' put on freehold industrial units. Why do you think I also own a commercial mortgage brokerage?

:rotfl:

Alan_M_2

You're right, it's mind boggling the amount of information I'm sent about new developments especially in the M23 corridor and around Kent, but they are almost all empty. Sooner or later a reality will have to set in and the Landlords will start to accept something rather than nothing.

For me it wouldn't make a whole lot of sense buying anything unless I was fortunate enough to find an industrial plot on which I could build my own premises.

It does make you wonder why builders bother with houses when you see what the margin is on steel framed industrial units.

chriz1000

Commercial properties I have acquired in the past usually don’t go officially under offer until Heads of Terms have been agreed by both parties and the contract has been passed over for both parties legal teams to agree on the small print and finer details.

Some companies will agree to temporarily take the property off the market and put it under offer when a price is agreed but this is rarer as Heads of Terms (details such as the rent free period, break clauses in the lease, rent reviews, rent deposit, capital contributions etc…) are usually what people quibble about and often lead to the deal being broken.

AndrewSmith

The local agents here tend to mark as under offer before that happens.

chriz1000

I think a lot of it is to do with the type of property and the agents, obviously there is a lot more pressure to agree the Heads of Terms if you believe the property is still on the market and other parties are interested. As a good will gesture the other party may choose to take the property off the market while in the early stages of negotiations, but as I understand it they are under no obligations to do so.