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| Choosing the type and location of premises |
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Sponsored By: King Sturge |
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Choosing the right premises for your business can be crucial. You
will have a vision of the image you wish to create, a sense of where employees
can be sourced and will be happy to work, where your customers will come and
spend money. On the other hand, you will be constrained by cost, uncertain
about future growth potential and wary of the downside risk if anything were to
go amiss.
The decision regarding the right location is critical. A shop with a low rent
and service charge, but tucked in a backstreet, will seem a false economy if it
attracts few customers. A cheap factory, available on flexible terms, but which
transpires to have asbestos needing removal and "through the roof" heating
bills, could sink your business before its maiden voyage.
Engage a surveyor to act on your behalf to shortlist properties that might
fulfil your criteria. Be aware that, as with domestic estate agents, an agent
selling property for a client has a duty of care to that client, not to you. He
must be professional and represent things fairly, but may not have all your
interests in mind as he seeks to fulfil his duties to his vendor client. Engage
independent advice to ensure that your interests are represented fairly. Most
commercial Chartered Surveyors will undertake this acquisition service for you
for a pre-agreed fee, and will have a range of specialists able to provide
advise on the right market deal, as well as on planning implications, physical
surveys of the building etc.
[http://www.ricsfirms.com/]
Ask your surveyor or solicitor to undertake appropriate searches and make
relevant enquiries, to ensure that the landlord is legitimate and that there
are no future local plans which may have implications for your occupation of
the property.
With regards to the property, not only must you consider your current business
strategy including the specification of the property and your budget but also
your future prospects, for example employee numbers and the need for possible
space expansion. Look at alternatives. Assess their relative strengths and
weaknesses, the opportunities that they offer but also those all-important
threats. The maturity of the property market is such that, if something seems
cheap, there is probably a reason!
Plan and plan again. Rehearse the upsides, and the downsides, with your
advisers and your friends. Challenge yourself, to ensure that emotion hasn't
influenced your otherwise sound commercial judgement.
Consider your proposed use for the property. Town & Country planning
legislation restricts the use of individual premises to specific business
purposes, broadly retail (including restaurants), office and industrial uses,
domestic purposes such as hotels and nursing homes, non-domestic purposes such
as education, museums, art galleries etc and leisure and assembly, such as
bingo halls, cinemas and swimming baths.
However, within these use classes [extract from use classes order below as
appendix 1] there are various more detailed definitions. Specific rules permit
alternation between some individual classes, but not others. Again, advice is
critical to ensure that prospective premises can be used for your required
purpose and also offer sufficient flexibility for the future. If not, a
planning application will be required, and the landlord will need to approve
your use. This can add to the acquisition timeframe, as well as introducing
additional costs and uncertainties.
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For any more information or help please contact Jeremy
Day, King Sturge, Tel: 020 7493 4933
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