Our specialist Commercial Property auction solicitors can assist with both the buying and selling of property at auction.
The increasing popularity of property auctions can often be related to the pricing benefits that they offer both buyers and sellers. However purchasing or selling a property at auction can also come with many legal risks that should not be ignored. Our property auction solicitors make sure that there is no instances of legal neglect regarding the auction process.
The advantages for the seller are obvious as it is a straightforward, quick way of disposing of property: there are rarely unexpected delays and completion usually takes place within 4 – 6 weeks of the date of the auction.
When acting for sellers, it is important that the sales pack is prepared quickly and accurately, as the packs are the basis on which the bids will be made. The more comprehensive the sales pack, the more likely it is that the property will receive interest at auction.
The story may be different for purchasers. Many clients are attracted by the low prices, but properties bought at auction can have substantial title defects or there may be other issues which are not disclosed by the seller initially. These issues are unlikely to be obvious from a physical inspection.
It is vital that you instruct a solicitor prior to the auction to thoroughly review the legal pack. If you make a successful bid for a property, as soon as the hammer drops, you are bound to buy the property whether or not you have checked the legal information available about the property.
Before making a decision to bid for a property at auction, it is wise to consult an experienced commercial property auction solicitor to help ensure that you do not make an expensive mistake.
At Myerson, our expert property auction solicitors are specialists in auction sales and can quickly appraise the documentation available and advise you on any potential issues with the property, which means that you are fully prepared when you step into the auction room.
Selling property at auction
If you are selling a property at auction, we will liaise with you to make extensive enquiries about the property.
The information obtained will enable us to prepare a full title pack and contract to be submitted to the auction house. Our commercial and pragmatic approach ensures that we anticipate any issues that may be a problem for a buyer and resolve them prior to auction.
Organisation and attention to detail at the commencement of the transaction are essential with auction transactions, so that completion takes place smoothly. Our wide range of experience means that we know the major auction houses and are familiar with the documentation each requires. This means that the auction packs can be produced quickly and accurately and in a cost-efficient manner for you.
Our property auction solicitors can assist in all areas of selling property at auction, including the following:
- Preparing a full title pack after meeting with you to discuss any and all issues with the property and obtain any relevant documentation from them;
- Reviewing our initial investigations to ascertain and cover in the contract any anomalies at the property, thus bringing them to the buyer’s attention prior to auction (if appropriate) and making the completion process more streamlined for you after the auction;
- Obtaining details of tenants and leases, rents, services charges paid etc. if there are tenants at the property, all of which need to be looked at carefully and individually;
- If property is to be divided into separate parcels at auction, it may be necessary to visit the site, consider where services are located and who will be responsible for them after the sale. It will also be necessary to consider whether any rights of way or rights of access are required. All of these matters need to be anticipated well before the auction and provided for in the auction pack.
Buying property at auction
Our specialist team can assist you in all areas relating to buying property at auction, including the following:
- Clients frequently advise us that they have bid and been successful at auction. This means that we only have a limited time in which to complete the transaction. Ideally, it is best if you approach us prior to auction, in which case we will be able to very quickly download the auction pack from the auction website and report to you on the contents of it and any issues you need to be aware of;
- Where you are proposing to bid at auction, there is usually only a limited period of time in which to carry out a full due diligence exercise before the auction takes place. Our organised and experienced solicitors are able to report to you on the property, any searches provided and, most importantly, the contract that you would be entering into at auction. There is no room for negotiation at all once the hammer has been brought down at auction, but there may be a brief opportunity to make investigations and even negotiate before this happens.
- If you have already made a successful bid at auction, you will be legally bound to complete the purchase. We can still carry out a thorough due diligence exercise on the content of the auction pack in order to reassure you and ensure that there have been no misrepresentations made in the auction pack. This is a very worthwhile exercise and our experienced team are able to undertake the due diligence within a short time of receipt of documentation. We are also able to report on the content of any leases held by tenants at the property, whether they are protected by security of tenure, whether there are break clauses (thus affecting the potential income).
Examples of our recent work include the following:
- Acting for an investment client on the sale of a number of properties on an industrial estate in Stockport where we divided the property prior to auction and sold it in several lots. We had to carry out a comprehensive review of the title prior to dividing the property, deal with a number of issues including the allocation of ground rents, the responsibility for services and rights of access over the road for all the properties. The outcome was successful in that all properties were sold at auction and completions took place in a timely manner thereafter. The seller also recovered a requisite proportion of his costs for the sale through the contract as a result of provisions we inserted.
- Acting for a pension scheme in relation to the disposal of a high street retail property in West Yorkshire.
- Acting for a new client in relation to the purchase of a two tower, 116,500 square foot, two storey office building for £2.8 million. We were instructed at the point the client had exchanged contracts at auction, without taking any legal advice. We reviewed the auction pack and advised the client as to the matters affecting the site, in particular, there were employment issues which required consideration. The client was also purchasing the building with a view to redevelopment of one of the towers as an aparthotel and has now submitted an application for planning permission in this regard. We completed a refinancing of the site with HSBC Bank Plc subsequent to the purchase and we are currently advising on lease issues relating to the redevelopment of the site. Our quick thinking and commercial advice enabled the client to complete the purchase on time and in accordance with the contract, whilst being aware of the issues. Our approach has cemented the new relationship with the client, who has continued to instruct us.
- Acting for an established client in relation to the purchase of 7 investment properties at auction in the last 12 months, including the purchase of a large B&Q warehouse, a small industrial estate, a multi-let office building and several retail outlets.
How We Can Help
A member of our specialist team will be happy to help.
To discuss Commercial Property Auction Solicitors issues, please either use the contact form on the right, email us at email@example.com or call us today on +44(0)161 941 4000 to speak to a member of our team.