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selling to a developer/sitting tennants
colinjc
Posts: 7 Forumite
Hi i own a village shop with accomodation above. the lease runs out end of 2014 and i want to sell to developers as tennants cannot afford to buy but want to renegotiate lease. what problems will i have getting them to move out. thanks
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Comments
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Why do you want to get them out, that's the deveoper's problem not yours? Lots of developers are happy for there to be tenants in place as it gives them an income as they work the planning permission.
If they have a lease that does not expire until 2014 and there is not a break clause between now and then, then as long as they continue paying rent you can't get them out. You would need to come to a mutually beneficial agreement for them to rip up the lease, ie pay them to leave.0 -
if i cant get them out how will the developers ? wouldnt they offer lower price with tennants in situ? should i get planning permisson first or leave that to the developers?0
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Is it your tenants lease that runs out in 2014?
I personally wouldnt be even thinking about this for another year. They have the security for a long time, you cannot make them move out until then.
Seems to be a 'cross that bridged when you come to it' type of thing. You dont know who you are selling to yet surely? Different developers will wants different things I would have thought?0 -
if i cant get them out how will the developers ? wouldnt they offer lower price with tennants in situ? should i get planning permisson first or leave that to the developers?
They would pay them to leave. Short Term tenants such as this would have little impact on the value to a developer. However, they might be happy for them to stay until the developer is ready to develop the plot which may well be after 2014.
If you want better advice you really need to explain what the situation is:
Have you been approached by developers?
Have they told you they need the property empty before they buy it?
What do you think it can be developed into?
How much income does it currently produce?
How much have they offered you?0 -
not been approached by developers. thought about approaching them first. its a corner plot could be turned into 3 or 4 flats or large 4/5 bed house i would think, but not spoken to anyone about that yet. income 16k.pa
had premises valued 2006 at 275k with tennants 375k without0 -
Well if you are wanting them out sooner rather than later, I would expect you to be offering a chunk of change to get them out, considering you will be 100k better off, according to yourself...0
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If you want to sell it, just put it on the market and if there are developers interested they will find you. If you want to add value then get the planning permission yourself and sell it with the benefit of the consent, although there will be upfront costs.
If I were you I'd find a good local firm of Chartered Surveyors (who buy and sell commercial property) and get them to give you some marketing advice. It's unlikely they'll charge you for a marketing report and they'll tell you what it's worth now and what it may be worth with planning consent, you can then decide how to move forward.
I really wouldn't go off approaching developers yourself, you'll just get fleeced. That's how developers make money, they pay as little as possible and if you don't know exactly what your property is worth now and once developed you're in no position to negotiate.
On average, commercial property prices fell 45% between 2007 and 2010. So basing any kind of decision on a value from 2006 will make life quite difficult for you. You need up-to-date advice.0 -
That length of tenancy is 'unusual' and makes me wonder if this is a 'bog standard' AST or not.
When did the tenats move in? If it was between 15 January 1989 and 27th February 1997 was a 'section 20' notice served before commencement of the tenancy?Life should be a little nuts; otherwise it's just a bunch of Thursdays strung together.0 -
That length of tenancy is 'unusual' and makes me wonder if this is a 'bog standard' AST or not.
When did the tenats move in? If it was between 15 January 1989 and 27th February 1997 was a 'section 20' notice served before commencement of the tenancy?
It's a commercial property and therefore none of the above applies.0 -
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