Advice zone

23 March 2005 by
Advice zone

Do
Watch out for short leases. Section 32 of the Landlord and Tenant Act states that a lease is normally renewed at the end of the period, but the landlord still has the right to take back the lease if he or she wishes. If a lease has opted out of Section 32, it reverts to the landlord automatically.
Seek advice on rents, particularly with pub leases. Pub company rents can be unsustainable, and once you've signed a lease you can't negotiate.
Get the best overall finance package. Use personal recommendations or a specialist broker. Try the National Association of Commercial Finance Brokers (tel: 01392 491551; www.nacfb.org) for a list of recommended brokers.
Question everything. Things that seem too good to be true generally are. If someone offers you a finance package when all others have turned you down, ask yourself why.
A disreputable company could be telling you what you want to hear while fleecing you for large amounts.
View a potential property on quiet days as well as busy ones.
Ask yourself whether you're qualified or suitable for the business. Will you get a licence? Are you right for the job?
Don't
Rush into buying a lease. Always get advice from a broker, valuer or specialist.
Make an offer on a trading business before you've seen three years of accounts. If it's trading but there are no accounts, you need to know why; if it's closed, you'll have to rely on your business plan.
Enter a leasehold contract without a full dilapidation report. If you accept a property which needs repairs, you'll be expected to carry them out, rather than the landlord. Get a surveyor to look at it first.
Fall for the roses-round-the-door syndrome. Don't get sucked into buying a beautiful property with an upper limit on trade unless you're going for a lifestyle business and don't need a big income to survive. Make a list of expectations and requirements, such as number of bedrooms, the size of property you need, how much you need to live on, and how the business stacks up.

By Paul Thompson, a partner at Acorn Commercial Finance
www.acorn-commercial-finance.co.uk

The Caterer Breakfast Briefing Email

Start the working day with The Caterer’s free breakfast briefing email

Sign Up and manage your preferences below

Check mark icon
Thank you

You have successfully signed up for the Caterer Breakfast Briefing Email and will hear from us soon!

Jacobs Media Group is honoured to be the recipient of the 2020 Queen's Award for Enterprise.

The highest official awards for UK businesses since being established by royal warrant in 1965. Read more.

close

Ad Blocker detected

We have noticed you are using an adblocker and – although we support freedom of choice – we would like to ask you to enable ads on our site. They are an important revenue source which supports free access of our website's content, especially during the COVID-19 crisis.

trade tracker pixel tracking