Commercial Property

Commercial Conveyancing

QLD and NSW

Fox and Thomas can assist with commercial property acquisitions and sales throughout the whole of Queensland and New South Wales.

In addition to the work we carry out in the conveyance of a residential property, we conduct additional due diligence enquiries including investigation of permitted uses of land, the details of commercial leases, land tax implications, zoning and much more.

How to get ready

As always, we recommend that you and your business partners have critical conversations with your solicitor, accountant, financier and any other advisors prior to entering into a contract for the sale or purchase of commercial property.

Another important issue to consider in the conveyancing of a commercial property is GST, which may be payable on the purchase of this type of property. If so, an extra 10% on the property’s purchase price should be factored in, which can potentially be claimed back later as an input tax credit if you’re an investor.

Business sale and purchases

QLD and NSW

Fox and Thomas’ practice includes advising on the acquisition and sale of businesses throughout Queensland and NSW, with a particular focus on complex agribusinesses.

We can assist with the due diligence required to prepare a business for sale, help you negotiate the terms of the purchase or sale, and preparation of the contract of sale.

How to get ready

The purchase or sale of a business is a complex process and requires input and advice from your solicitor, accountant, financier, valuers, and any other advisors.

There are many factors to consider in the purchase or sale of a business, such as:

• What is to happen to the employees of the business (and their accrued entitlements)?
• Does the business have all the correct licences and permits required to run the business and are those licences and permits current?
• Will the existing lease be assigned or will a buyer need to enter into a new lease for the Business Premises?
• Is there any intellectual property that needs to be transferred as part of the sale?
• What stock, plant and equipment will be included in the sale. A pre contract stocktake can also help a seller identify any assets owned by the business they may wish to retain. Is any plant & equipment owned by third parties?
• Is the stock included in the purchase price or in addition to the purchase price, being an additional amount payable at settlement by the buyer (usually after a stock take is undertaken on the day of settlement)?

Leasing

Retail Shop Lease

A retail show lease is required when leasing premises located in a shopping centre or premises used predominately for a retail business. Fox and Thomas can assist you with reviewing and negotiating the terms of your retail shop lease.

Retail leasing legislation in both Queensland and New South Wales imposes additional disclosure obligations on landlords and tenants which must be complied with before signing or transferring a retail shop lease. If the correct disclosure process is not followed it could result in the loss of rights under the lease or claims by one party against the other.

With the definition of a retail shop lease differing in each state and territory, there is no single definition of a retail shop lease. As it will not always be clear whether the tenant’s activities fall within the meaning of ‘retail’, we recommend seeking advice from our property team to confirm whether your lease will be a retail shop lease.

Commercial leasing

A commercial lease can be quite complex, cover a wide range of items and is often tailored to reflect your specific circumstances and requirements.

A well-drafted lease will protect and benefit both the lessor and lessee. All parties entering into a commercial lease should seek legal advice to ensure their rights and obligations are understood, and their legal and commercial interests are protected prior to signing.

It is important that intending lessors or lessees contact their lawyer in relation to commercial leases before they enter any agreement relating to commercial premises. Such agreements that can be called different names such as ‘Agreements to Lease’, ‘Lease Proposals’, ‘Offers to Lease’ or other names can in fact be binding lease agreements that mean that you can be forced to enter a lease based on those terms even though you have not signed a lease.

Once the lease document is produced following the initial proposals, it is quite often too late to try and negotiate then. You could be held to an agreement which may be uncommercial or not in your interests. Due to the long periods of time that you can be bound by a lease it is essential to get it right from the start and understand what you are signing and that you are entering an agreement that is right for your business.

We will help you as necessary with negotiating the agreement to lease or commercial lease agreement–the lease itself, making relevant searches on title and ensure you are able to conduct the business, as lessee, from those premises depending on council planning requirements.

Due Diligence

Due Diligence is the process of conducting investigations into the property you are purchasing. There are a range of significant issues that may affect a property and may impose restrictions or obligations on you as owner of the property. It is important that you are satisfied with your due diligence enquiries prior to the contract becoming unconditional.

There is no limit to the level of due diligence you may wish to conduct. This can be very overwhelming and can leave a purchaser feeling lost on where to start. We recommend you consider what is important to you about the property, why you are purchasing this particular property and how you want to use the property now and into the future. These few questions can assist your solicitor in determining what level of due diligence is right for you. The cost of conducting appropriate due diligence now may save you significant costs in the future.

It is also a good idea to discuss your potential purchase with your insurer before you commit to a contract. Certain areas within Queensland and New South Wales may be considered high risk for insurers and therefore may have higher insurance premiums than what you have budgeted for.

When selling a property, you should place yourself in a purchaser’s shoes and ask yourself “what would I want to know about this property?” We recommend you give thought to this question and gather any information you may have in relation to the property so that you have as much information as possible available to assist your purchaser with their due diligence enquiries. Assisting a purchaser with their due diligence enquiries will ultimately assist in your contract becoming unconditional.

Purchasing entity advice

We provide advice on how to best structure your property purchase, depending on your individual and business circumstances. What structure you choose to purchase property in can have wide reaching effects on areas such as tax, estate and succession planning, and asset protection, so it is important that the most appropriate entity is selected.

Foreign buyers

Fox and Thomas are experienced in assisting foreign buyers acquire property throughout Queensland and NSW, having acted for buyers from Europe, North America and the United Kingdom. Foreign buyers who wish to purchase residential property or agricultural land are subject to a number of rules.

Foreign buyers purchasing residential property (of any value) or agricultural land (above $15 million) must obtain approval from the Foreign Investment Review Board (FIRB) before acquiring the property. We can assist you in the FIRB approval process and ensure that the necessary special conditions are included in the contract for sale.

There are additional stamp duty implications for foreign buyers of residential property which we can advise you on. In NSW, foreign buyers of residential property are charged an additional surcharge duty of 8% and in Queensland, foreign buyers of residential property are charged an additional transfer duty of 7% known as Additional Foreign Acquirer Duty (AFAD).

Foreign buyers of agricultural land and water entitlements are also required to register their interest/son the Register of Foreign Ownership of Agricultural Land and the Register of Foreign Ownership of Water Entitlements. We can assist with this registration process.