Laceys Solicitors Laceys is a leading, forward-thinking law firm with specialist experts serving both individual and business clients across a broad spectrum of practice areas.

Navigation

News

Back

blurred shoppers on the high street

Your commercial property portfolio – time to restructure?

4th November 2020 by Mark Preece

Categories: Covid-19
Tags: , , , , , ,

A commercial property portfolio is just like any other investment – to get the best out of it, you need to manage it well, and sometimes it will benefit from being restructured. The unforeseen impact of Covid-19 on the whole of the UK economy has underlined the importance of keeping on top of your property investments, so you are able to move quickly when you want to grab an opportunity or mitigate risk.

‘A good commercial property lawyer will get to know your property portfolio as well as you do’ says Mark Preece, head of Commercial Property at Laceys.  ‘The more closely we are involved, the more we can do to help you plan your strategy and head off problems before they arise. Careful planning and regular reviews of your property investments will give you the best chance both to prosper in good times and withstand unexpected shocks, such as the coronavirus.’

Acquisition opportunities and due diligence

If you are in a strong position financially, then you will be on the lookout for investment opportunities. The key to a successful commercial property investment is careful research before you buy. You will need to do a physical inspection of the site and your solicitor may be able to join you, looking out for evidence of issues such as rights of way, drainage and rights of light.

Back in the office, they will carry out searches and enquiries against a wide range of data, which should enable to them to spot potential problems early on. For example, you may need to know about any planning permissions granted for sites nearby or intended schemes for road or infrastructure improvements.

Selling uneconomic property

As market conditions change, you may want to offload properties that are no longer performing well. High street retail, entertainment and leisure have been hit hard by Covid-19 and it may be more difficult to adapt older buildings to allow for social distancing in line with government advice. As well as handling the legal process, your solicitor may be able to introduce you to other contacts looking to invest.

Return on investment

You need to keep a close eye on how the properties you retain are performing.  The impact of lockdown on retailers in particular may mean you need to regear leases to keep your tenants. Across the market, tenants are seeking short-term rent holidays, often in return for postponing break rights or taking additional years at the end of the current lease. There is also a growing trend for rents to be based partly or wholly on the tenant’s turnover, especially in retail villages and outlet centres. This inevitably means the landlord sharing more economic risk and it is crucial that these arrangements are properly documented by your solicitor.

Structuring deals

You may be investing on your own but if you intend to buy and hold a property jointly with others, you will need advice on the structure, whether that is a joint venture, a partnership or a company. Getting this right will make a big difference to how quickly and easily you can trade your property in the future. For example, if you find yourself in a joint venture with a struggling business that can no longer fulfil their side of the bargain, you need to know you have a clear exit procedure.

You should also take advice on the best way to hold property in your portfolio.  This will depend on your own tax position and your long-term plans. Holding individual properties in separate companies can make future sales more efficient and give you more flexibility, particularly if you are investing in sites that are used partly for commercial and partly for residential purposes.

Risk and compliance

As we face a world where social distancing is likely to be required for some time to come, advice on regulatory issues such as health and safety is more important than ever.  A property owner retains some responsibility, even for property occupied by tenants.

As well as ensuring buildings are Covid-19 safe, owners need to be aware of their potential liabilities in relation to areas like fire safety and energy efficiency.  Regulations can change fast and penalties can be tough.

On top of that, the scope for insurance to cover many of these issues is currently a matter of debate, all of which means that commercial property owners will need regular updates from their legal advisors to make sure they keep pace with a changing risk landscape.

Strategic advice

Our commercial property lawyers can stand beside you, giving you the benefit of their experience of successful investment strategies and possible pitfalls to avoid.  They will bring a different perspective on the market and will be able to look ahead to how things are likely to change in the coming months and years. Nobody can avoid market changes altogether, but investors with well managed and structured portfolios will be in a strong position to take advantage of opportunities as they arise.

If you would like further advice on your commercial property portfolio please contact Mark Preece in confidence on 01202 557256 or email m.preece@laceyssolicitors.co.uk

Mark Preece

Partner — Commercial and Residential Property

Direct dial: 01202 377862

Email

Mark Preece image profile
  • “Mark has acted for our varied property portfolio in Dorset for over 5 years, and has a real understanding of our business and how we operate. He shares our passion for high standards and attention to detail, providing us with invaluable advice and support on all aspects of our developments from initial site acquisition through to completed property sales. Mark and his team continuously add value by being proactive and delivering a fast and expert service."”

    Eddie Fitzsimmons- Managing Director, Lomand Homes Limited

  • “Quick, responsive service. Prepared to recommend a way forward and not sit on the fence.”

    Guy Eccles

  • “Efficient, competent and friendly.”

    Michael Bond

  • “Mark and the team take great care of our commercial property requirements. We have always been delighted with their service.”

    Simon Ward, NSN Propertis Ltd

  • “Straightforward. Everything kept clear and simple.”

    Nicola Maidment

  • “I appreciate the personal service and the feeling that my business is important. I also respond well to a friendly approach.”

    Andrew Taylor

  • “Mark noted the requirements of the sale and worked very hard to achieve an excellent prompt outcome. He phoned me immediately the deal was done!”

    Paul R Barry

  • “Excellent service provided by Mark Preece and his team.”

    Francis & Natalia Erard

  • “Everyone at Lacey's seem to have my best interest at heart and act super efficiently. A pleasure to deal with.”

    John Beauchamp

Mark qualified as a solicitor in 2008 after gaining an LLB (2003) and LLM (2005) at university’s in Birmingham.  He completed his training contract with the North Dorset and South Wiltshire firm now known as Farnfields LLP and joined Horsey Lightly Fynn (HLF) in Bournemouth in 2011.  He became a partner at HLF in 2014 and at merger of HLF and Laceys became a partner in the merged firm in 2015.

Mark is a partner working across our Commercial and Residential property teams acting for a wide variety of clients from property developers, property investors, businesses, first time buyers and those needing advice relating to enfranchisement and residential landlord and tenant dealing with all aspects of property work.

Away from work Mark spends his time with his wife and their three young boys who keep them very busy.

Related articles

Commercial lease agreement with pen

Ten key negotiating points when taking a new commercial lease

When a landlord and tenant try to settle the terms for a new commercial lease, each party...

Read Article

commercial building work

Extending your commercial property

If your business is expanding, you may have outgrown your current premises.  Before you start looking for...

Read Article

Close X