Option to buy agreement - Commercial property
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Description
Experience Level: Expert
Estimated project duration: 1 day or less
We have a draft of an option to buy agreement that we would like checked and modified to ensure it offers the terms we want to agree with potential tenants in our commercial property.
The tenant will have or be about to sign a 5 year lease with an option to break at 3 years. Rent payable quarterly in advance. Rent review at 3 years. Upwards only minimum of 1% or linked to RPI whichever is greater.
Our offer will be that for a fee payable now, (£2,500) we will agree that tenant can purchase the property during the last 3 months of the 5 year tenancy at the initial price plus RPI during the 4 years 9 months of the tenancy or open market value for an owner occupier. The option must be correctly exercised 90 days prior to the end of the lease and the completion of the purchase prior to the end of the lease.
A key element of the offer to option is that the tenant must still be in occupation with the rent and charges paid on time during the tenancy and up to date.
If they leave at 3 years - option falls away
If they breach the terms of the lease and the lease is forfeit the option falls away.
We don't want to be unreasonable but we don't want a bad tenant who has been late with the rent and difficult to be able to stop us re-letting or selling.
If they don't exercise the option then the fee is not refundable. If they do excuse the option then the fee is used as part of the deposit paid on exchange.
The tenant will have or be about to sign a 5 year lease with an option to break at 3 years. Rent payable quarterly in advance. Rent review at 3 years. Upwards only minimum of 1% or linked to RPI whichever is greater.
Our offer will be that for a fee payable now, (£2,500) we will agree that tenant can purchase the property during the last 3 months of the 5 year tenancy at the initial price plus RPI during the 4 years 9 months of the tenancy or open market value for an owner occupier. The option must be correctly exercised 90 days prior to the end of the lease and the completion of the purchase prior to the end of the lease.
A key element of the offer to option is that the tenant must still be in occupation with the rent and charges paid on time during the tenancy and up to date.
If they leave at 3 years - option falls away
If they breach the terms of the lease and the lease is forfeit the option falls away.
We don't want to be unreasonable but we don't want a bad tenant who has been late with the rent and difficult to be able to stop us re-letting or selling.
If they don't exercise the option then the fee is not refundable. If they do excuse the option then the fee is used as part of the deposit paid on exchange.
Kevin J.
100% (64)Projects Completed
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Last project
5 Apr 2023
United Kingdom
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