A Guide to Buying Commercial Property

If you’re interested in buying commercial property, you might be looking to purchase this for your own business venture or to let it out to other organisations. It can be a great investment for your property portfolio or for your own business, and auctions are often an effective way to purchase commercial property across the UK. 

Here we’ll talk about how to buy commercial property at auction, what to look out for with this type of purchase and how to get started with finding commercial property for sale. 

How to buy commercial property at auction 

There are a number of key things to do and consider when looking at buying commercial property at auction. 

Research auction houses and properties 

If you’re interested in buying commercial property at auction, start by researching and comparing different auction houses and their unique auction terms. It’s also helpful to make sure you understand the process of buying at auction at this stage.  

Once you’ve done that, you can start researching the type of property you’re interested in purchasing and what’s available in the local area. Put careful consideration into what you want to purchase, and spend time researching the local market. 

Do you due diligence 

Undertaking your own due diligence ahead of bidding on any property is a crucial part of buying at auction. If you have the winning bid, you’ll be committed to the purchase, so you need to do any due diligence beforehand and ensure you know enough about the property and location. View properties you’re interested in and look through legal packs in detail.  

Work with a solicitor 

Instruct a solicitor to work with throughout the process of buying commercial property at auction. It’s recommended to get them involved when you find a property you’re interested in, so they can look over the property’s legal pack ahead of the auction. Your solicitor can then help identify legal issues or restrictions, allowing you to make more informed decisions before it’s too late! 

Get your finances in order 

It’s essential to get your finances sorted in advance of an auction, so consider the options available to you ahead of time. If the property is mortgageable and you need to utilise a specialist commercial mortgage to purchase the property, there are typically interest-only and bridging options. It can also be helpful to work with a specialist mortgage broker. 

Keep in mind that auctions typically require a 10% deposit on the day of the auction, so you’ll need to be ready to pay that straightaway in case you have the winning bid. If you’re planning to pay fully with cash, make sure you’re in a position to pay the full purchase price by the completion date, which usually needs to happen within 28 days. 

Be prepared for the auction 

One of the most important things about buying commercial property at auction is being as prepared as possible. The more research you do beforehand, the more prepared you can be for commercial property auctions. Take the time to research bidding strategies, and set a budget ahead of time to ensure you don’t get swept up in the bidding. 

Keep in mind that if you end up having the winning bid, you need to be ready to complete within the timeline set out in the auction terms. If you already have your funding sorted and hired a solicitor prior to the auction, it can make this process much easier and less stressful, so make sure you’re prepared in advance. 

Things to think about when buying commercial property at auction 

Whether you’re buying a commercial property to rent it out to other organisations or to run your own business from, there are some things you should think about to help you find the right lot for you. 

Location 

Location is key for any property purchase, and this is no different with commercial properties. The type of commercial property you’re planning to buy will largely impact what the best location will be. 

Close proximity to certain amenities, access and transport links are likely important considerations for any commercial property purchase. Be sure to do thorough research on this to find the best possible location for your investment. 

Property type 

As a commercial property is simply a property a business operates from, there are numerous different types, including office space, industrial units, retail properties, leisure facilities, healthcare buildings and even mixed-use developments. 

Commercial properties are separated into different classes in planning laws, so if you find a property you’re interested in, check that it can be used in the way you want to. Look out for any restrictions that could prevent you or your tenants from doing certain key business activities. It may be beneficial to seek legal advice to help you with this. 

Size and features 

Now think about your needs and priorities for the property itself. Start by considering how big it needs to be and what features you’re looking for, such as whether there needs to be space for parking.  

Before you can get started searching for a property at auction, make sure you understand what you’re looking for in detail. This will help you find the right property and ensure you don’t waste time and money considering and viewing properties that simply won’t work for you.

Budget 

Setting a budget is another crucial thing to do when you’re interested in buying a commercial property at auction. You need to know what you can afford to pay for the property, while factoring in all the relevant purchase and operating costs. 

It’s also helpful to take a close look at the local market. Check out commercial properties across the auction sector and open market. Compare prices across the board and take into account what’s offered with each property. 

Find commercial property for sale at auctions

If you’d like to get started searching for commercial property auctions, research auction houses who sell the types of property you’re interested in purchasing. Sign up to receive their catalogues as soon as they’re released, and find out when their upcoming auctions are.  
Keep an eye out for commercial property for sale and unsold auction lots that might interest you. This can help you get on the front foot and allow you to be ready for any exciting properties that come up!

Buy commercial property at BTG Eddisons Property Auctions 

At BTG Eddisons Property Auctions, we run online and live streamed commercial property auctions across the UK. Our experienced experts can help with the entire buying, selling or letting process.  

Browse our commercial property for sale and unsold lots that are still available. If you have any questions about purchasing at auction or any of our commercial property for sale, get in touch with our friendly team. They can also provide personalised support and guidance every step of the way to ensure you feel confident when buying at auction.