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What are Commercial Property Searches and Why do You Need Them?

When buying commercial property, land or entering into a lease agreement, one of the essential steps of the process is the conducting of searches.

To help you understand more about what a commercial property search is and why they’re such an integral part of the property process, Commercial People has put together the following guide to help teach you all that you need to know.

What are Commercial Property searches?

Despite the name, a ‘commercial property search’ is not the same as searching for commercial property. A property search refers to the carrying out of a range of surveys (searches) on the property that you wish to lease.

There are a variety of searches you should ideally perform before exchanging contracts including a Local Authority Land Search, Environmental Search and a Drainage & Water Search to name but a few.

For a complete breakdown of each search available, please see below:

Understood, but why are searches so important?

As a buyer, you need to to be aware that once the contracts have been exchanged, you’re unable to pull out or reverse the transaction. As a result, searches can be a fantastic way to unearth any unforeseen problems that might arise later. Meanwhile, failure to conduct these searches could put you at risk of potential liabilities or costly problems at a later date.

Simply put, searches enable buyers to learn as much as they can about a property before committing to the purchase.

Should you find anything unexpected or problematic during one of the various searches, you have the opportunity to ask for a renegotiation of the deal (usually a lower price)or for the issue to be resolved.

What types of commercial property searches should I do?

Local Authority Search

A local authority search will provide information affecting the property that could have financial implications on yourself or the use of the property. Costing approximately between £150 – £300, the Local Authority Search is a great way to discover the existence of any imposed restrictions or pre-existing planning conditions that you were not made aware of.

A Local Authority search will reveal the following:

  • Clarification on the existence of planning consents or building regulations approvals that have been granted, pending or refused.
  • Outlining whether the highways serving the premises are maintained at a public expense
  • Revealing whether there are any new roads or railways proposed within 200 meters of the property.
  • Whether any public footpaths run through the property as well as if the property is a listed building, registered as Common Land or within a Conservation Area

Drainage & Water Search

A Drainage & Water Search is conducted via the local water provider that supplies the property with its water supply. Drainage and water searches usually cost between £100-£200 and are important as they can reveal:
If the property is connected to the mains water supply and if metering is in place
Whether foul and surface water at the property drains to a public sewer
Whether there is a water main or public sewer within the boundaries of the property

Environmental Search

An Environmental Search will reveal search reveal whether the property resides on what could be deemed as contaminated land.

A property that lies on contaminated land could significantly harm any proposed redevelopments you may have had in mind for the premises and could prove to be costly down the line if you fail to address the issues.

While you won’t be expected to pay for to decontaminate the area, you might end up facing charges if the original polluter cannot be found.

In addition to contaminated land, this search also reveals whether the property is in an area at risk of flooding. The cost of this search is approximately £150-£250, but the exact cost can vary depending on the location.

Highway Search

A Highway Search will go further into any highway-related information revealed by a Local Authority Search and will reveal the true extent of a publicly maintained highway.

A Highways Search will go into great detail to reveal whether there are any parcels of land, or so-called ‘ransom strips’ between your property and the highway that are could pose a logistical problem for your property.

The cost o a Highway Search is typically around £50, but as always, this price may vary depending on the property’s location.

Chancel Search

A Chancel Search will reveal whether the property is situated in a parish which is subject to a potential chancel repair liability.

Dating back centuries; a chancel repair liability is a legal obligation on some property owners in England and Wales to pay for certain repairs to a church.

Thankfully, however, properties purchased after the 13 October 2013 will be free of any chancel liability, so insurance should not be necessary.

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