Financing a Leasehold Shop!?

DermotFlanigan

A sports shop has become available not far from where I live. All the information I have so far is, it's £35,000 annual rent.

The turnover is £375,000 per year.

What is the norm for taking over such a business? Do you pay the £35,000 as a one off using a loan? What option would I have? I have approx £3000 in savings and earn £650 a month. I will be keeping my part time job and my other half would be running the shop.

Any help advice would be great, before I pursue this further.

Thrugelmir

Are you intending to buy the business? If so £3k is insufficient funding to even start the process. That could be swallowed in professional fees alone.

DermotFlanigan

I am just seeking advice on what options are available. And how do leaseholds work? Do I pay a lump sum, them pay rent? There is no mention of an asking price...It just says £35,000 per annum?

Thrugelmir

matthewandemma wrote: »

I am just seeking advice on what options are available. And how do leaseholds work? Do I pay a lump sum, them pay rent? There is no mention of an asking price...It just says £35,000 per annum?

Then its just the property that's available to rent at £35,000k per annum.

DermotFlanigan

So what expenditure would I have to pay? Are there no upfront fees?

DermotFlanigan

This is the shop in question.. http://www.vebra.com/property/1185/22215995

Thrugelmir

matthewandemma wrote: »

So what expenditure would I have to pay? Are there no upfront fees?

I would say a sum in 6 figures for the business. As there's a consideration for the goodwill in the business and also purchase of stock plus fixtures and fittings.

You would need to also be able to satisfy trade suppliers as to your solvency.

WellKnownSid

matthewandemma wrote: »

So what expenditure would I have to pay? Are there no upfront fees?

Legals and other costs on commercial property can run into tens of thousands, especially if the owner gets you to pay both sides.

You'll want a survey, too - as it'll likely be a full maintenance and repair basis.