There has been much in the press detailing the plight of high street retail property and the struggles in relation to the historical norm for paying rent quarterly in advance.
Trading from a prime retail property is expensive. Rent is however only one aspect and often the rates appear to be excessively high and particularly in shopping centres there is the service charge element to consider. However, do monthly rent payments solve the solution? Recent reports from the retail property market point to several famous retailers which have begun the negotiations with their landlord to pay the rent every month despite the fact that when the leases were agreed it is agreed that the rent will be paid 3 months in advance. Many retail property owners are looking into these requests as they see some advantages behind it – perhaps credibility and the cash flow problems of the tenant and, to some degree if they fail to pay, the owners may see it coming quicker and can deal with it accordingly.
The question often put to us is why pay in advance? Without seeming cynical, if rents were recovered in arrears, would it make any difference?
The same can be said for all other forms of commercial property. Whether it is offices in Peterborough, industrial units in Huntingdon or retail property in Cambridge, the rent payment trend is changing in the UK.
Despite the doom and gloom of the rather persistent recession it is probably surprising to hear that the number of bank repossessions in the commercial property market, well at least in our region, is surprisingly few.
In most cases the reason for the repossession is clear – the bank wants to recover the loan and does not want specific debt on certain property assets and the obvious – the debt has not been serviced and there is little hope of it being so.
As well as the bank suffering a likely loss inevitably the seller will probably have lost all their equity in the process. However the purchaser may see an “opportunity” to acquire an asset at distressed levels. As such therefore, purchasing a repossession is more than likely a good mover but finding these properties is not that easy.
If you are looking for industrial Property Cambridge then try the Barker Storey Matthews website. We will also use various national databases to ensure we market the property correctly for the lending institution we are acting for. If you are a buyer then you must also accept that often there will be little information to go on and your solicitor may have to carry out more checks than usual. Indeed where we are acting for receivers the vendors will have no liability to the purchasers post completion of the sale so your due diligence prior to purchase will be of paramount importance.
The same of course applies to residential properties as well as commercial property.
If you are in the process of purchasing a repossessed commercial property it is also important to make sure you arrange for a building surveyor to provide a full and detailed assessment of the building prior to purchase. Barker Storey Matthews can also help in this respect. Finding the right Industrial Property Cambridge is the first step, getting it thoroughly looked at is the next !