Throughout the pandemic we have been completing property acquisitions for a variety of businesses seeking new premises, from offices and warehouses, to helicopter storage hangars.
Indeed, despite the challenges that COVID-19 lockdown has presented, deals are still able to be completed very quickly.
To help you keep your property deal on track in 2021, no matter the economic landscape or COVID-19 restrictions in place, here are our top tips to help get your property deal over the line.
Understand the internal business case and financial approvals required to complete a property transaction.
Internal agreement and approval can often impact transaction timeframes, particularly in larger organisations.
Make sure you understand the process and obtain buy-in to your property strategy from every internal stakeholder before kickstarting your property search. Agree the process, planned programme and everyone’s role within that at the outset.
Economic uncertainty often translates into a tightening of purse strings, so you may find it more challenging to put forward the business case to spend money on property currently.
Be sure to make your case effectively, whilst also recognising as far as possible any risks up front, so that these can be built into the business case, rather than them becoming the reason the transaction fails down the line.
Establish specification, budget & timescales – then be flexible
Have a clear idea of what it is you need in terms of space, ideal location, as well as having a clear timetable for a potential move. But be flexible with it.
Consider the criteria of the project and property you are willing to compromise on. This is because you may not find exactly what you want, where you want it.
Be open to other possibilities which might include more homeworking or sub-letting space, even a location slightly further afield, because your ideal scenario may not be deliverable against the current climate or your timeframe.
Ensure that both the likely P&L cost is accurate as well as the capital expenditure budget for any move. And don’t forget to incorporate survey and legal fees, as well as taxes into your budget, as this can have a significant impact, particularly Stamp Duty Land Tax.
Make the most of site visits
As more businesses reopen post-Lockdown 2.0, the challenges of site visits will reduce slightly, but they won’t disappear.
If you are able to coordinate a site visit, try and get as much undertaken as possible, because you may not get another chance to view before agreeing a deal.
Get everyone party to the deal on site at the same time, adhering to social distancing requirements of course, and discuss practical challenges, whilst getting to grips with the landlord’s processes.
This will help you to verbally agree much of the practical elements on the day, circumventing time consuming and lengthy e-mail exchanges or additional Zoom calls.
Also recognise that the usual sequence of events may not be possible, and work around the restrictions in place at the time.
For example, you may want to consider instructing lawyers before full survey/site visits, with the caveat that that it is subject to survey and validation of certain practical elements.
If all parties are acting in good faith and transparently, this will save time, as the survey and physical property elements can run in parallel with the legal process.
Finally, bear in mind that Local Authorities are stretched by the pandemic and economic response so build in sufficient time to allow for local authority legal searches.
Go into communication overdrive
Make sure that there is a constant stream of communication between you, the landlord and the lawyers, as this will aid transparency and ensure that potential hurdles are overcome quickly and efficiently.
Involve lawyers at the outset to ensure they have the opportunity to query and are aware of the timeframes – no lawyer will thank you for requiring a transaction to complete quickly, out of the blue and with no background information!
If you have an appointed adviser to assist you with your property requirements, they should do this on your behalf, keeping you in the loop throughout.
Anticipate next steps
If you have a clear property preference, request a copy of standard information such as warranties, as well as the landlord’s standard draft lease in advance, as this will help to identify potential stumbling blocks or missing information early on in the process.
Be clear from the outset what fit-out works you need to undertake as an occupier, and ensure you have plans and specifications available at an early stage.
This will enable landlords’ consent to the works to be obtained in parallel with agreeing the lease, whilst ensuring the works are accurately documented in a licence to protect your interests in the future. If these cannot be provided quickly, ensure the principle of the extent of the works is agreed.
Plan for the unexpected
Sometimes, especially in the current climate, unanticipated hurdles can arise which may scupper your property plans.
For example, despite their best efforts, the landlord may not be able to carry out agreed planned works.
In this case, make sure that there are work arounds in place, agreed with your landlord, to avoid you being left in hot water.
Equally, as an occupier you may not be able to secure all the details of your fit-out, but this can be covered in the legal documentation, provided the broad scope and extent of works is agreed with the landlord.
These remain challenging times in which to complete property deals, but it is absolutely possible. Not only that, deals can be negotiated and completed very quickly, provided everyone is on board with the process.
Of course, it helps to have an experienced adviser on your side, not just to negotiate the best possible deal, but with the insight and experience necessary to present potential solutions which you may not otherwise consider.
If you would like to discuss your property needs with one of our advisers, get in touch and we will be happy to help.
