What is a Commercial Building Survey?

A commercial building survey provides you with much more than merely a financial asset valuation. It also provides a deep insight into the current condition of a building, including information on building defects, materials, construction and if there are any hazardous materials present, such as asbestos. The survey may also suggest any necessary corrective work that would support any claim for a price re-negotiation.

Commercial buildings can be substantially different from residential properties when it comes to surveys. The structure of the building may have been built using reinforced concrete, cladding, and steel, which required a completely different approach to that used for a domestic building survey.

Here at VKB Consultancy, we are independent RICS Chartered Surveyors. We provide impartial assessments to protect the interests of our clients. VKB consultancy follows the published guidelines, including the RICS Guidance Note – Building Surveys and Technical Due Diligence Commercial Property (hyperlink) which allows us to deliver a survey that serves as a respected tool, helping clients manage their commercial property.

A building survey offers valuable and professional guidance on any issues that may cause disruption to your interest in selling leasing or buying a commercial property. We provide a high level of attention to detail, ensuring that we fully understand the construction of a building, the current condition of the building and how it will meet the requirements of the client.

When planning a Commercial Building Survey, the first thing would be to discuss and review your circumstances and requirements. This will ultimately establish the level of advice that is required and whether this is in the context of an existing ownership. It will also determine whether it is the purchase of both a freehold and a freehold with tenant in situ, whether it is a new lease or an assignment of a lease. It is also to understand your proposals for the property.

Before organising an inspection, we will also review whether there may be any access issues. If you were planning to extend or alter the property once the deal has already been processed, you may also want us to include preliminary advice or feasibility reports. The content and format of the report can then be tailored to your requirements and a quotation provided accordingly.

If you are the owner of a commercial property, or you’re looking to purchase one to then enter a lease, contact us today. We can provide advice and recommendations regarding the condition of a commercial building!

Using a building Survey Report to negotiate a sale

A building survey report is a detailed report, created by a building surveyor, which describes the condition of each element of a house or commercial premises and identifies the property's defects, their apparent cause, the urgency of repair and maintenance options available. It may also include an approximate cost of repair.

If the condition of the property is positive, with no significant defects or issues, you have the reassurance that substantial expenditure will not be required at the time of purchase or in the future. This can give you the reassurance/confidence to proceed with the purchase at an agreed price, safe in the knowledge that you have made a sound investment.

But what if the report shows a negative result? Should you walk away? Or can you use the report to your advantage and negotiate with the vendor?

Should I walk away from the sale?

It really depends on whether you expected a negative result! If you were already aware of all the defects or issues outlined in the report, you may feel confident to proceed with the purchase, safe in the knowledge that there will be no additional, unexpected defects or issues (and related expenditure) in the near future!

If, however, the report highlights any previously unknown defects or issues, you may wish to reconsider your offer depending on the nature and severity of what is included in the report. 

First and foremost, speak to your surveyor so you understand the implications of anything highlighted in their report. They will advise you on the next steps, whether any further investigations are required and give you a comprehensive breakdown of the survey. Don’t be afraid to ask for advice!

If the Building Survey Report finds significant defects and/or issues and you are not prepared to invest the time/money that will be required to ensure the property is eventually in a good condition, walking away from the property is a sensible decision.

When should you negotiate on a sale?

If you are still keen to continue with the purchase, but the report has highlighted previously unknown/undisclosed defects with the property, you are potentially in a strong position to negotiate with the vendor.

The vendor may argue that the defects are obvious and that the purchase price is reflective of the defects. However, if the survey has revealed concerns about the property and you can quantify the costs to repair or maintain it, either now or in the future, it gives you a much stronger position to negotiate the sale price should you wish.

Negotiating a purchase price can be quite nerve-wracking and it is always worth bearing in mind that you could lose out on securing the purchase if there are other parties in involved (or if you upset the vendor). You should consider what you will do if the vendor refuses to negotiate. How much do you want the property? Would you still be willing to pay full price for it? Can you afford to rectify the property without a discount? How much will you be saving in the long run? Is it worth it?  

But if there is a significant, unknown cost associated with purchasing the property, you are probably in a good position to make an offer.

Would a Building Survey put your mind at ease or help you save money on a property you’re thinking of buying? Contact us today!