David Slane: Get the right advice before investing in property

10:48am Tuesday 3rd June 2008

TODAY'S growing businesses face not knowing whether it is the right time to take advantage of a commercial mortgage.

Barclays helps hundreds of businesses make property purchases every week - so what are the main steps?

* Get expert advice at every stage of the process. There are business-specific considerations with buying a commercial property such as health and safety issues, where you would probably benefit from some expert help and advice.

You may also need the specialist services of your accountant or financial advisor for tax-related matters.

* Think about financing your purchase. You will have lots of financial considerations to take into account, ranging from mortgage repayments to funding alterations to your building, and from arranging insurance to paying stamp duty.

It makes sense to work out all upfront and ongoing costs with your bank manager to see how much you need to buy your business premises.

* Find and evaluate your property. It can take quite some time to find the best property for you. There is no point in setting your heart on a city centre or out-of-town location if there are not any appropriate premises or if by-laws prevent activities that are essential to your business.

It's advisable to draw up a list of requirements for your property type and location and to hand this out to your estate agent.

* Freehold or leasehold? If you are considering buying a leasehold property, leases contain clauses affecting many aspects of ownership so it is vital to get legal advice.

* The future? You also need to give some thought to the future, for example, can your business grow and/or diversify at these premises or will this be prevented by the building, its immediate surroundings, the terms of any deeds or by local planning restrictions.

Buying a property is an important decision for a business, whether as premises or an investment. With the right financing, guidance and advice from banks, property agents, your solicitor and accountant, it can be extremely rewarding.

* David Slane is Barclays local business' regional director for the North-East

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