Pension scheme in the purchase of a mixed-use commercial property

The Problem

We recently acted on behalf of a trustee of a pension scheme in the purchase of a mixed-use commercial property. The property comprised of a shop and residential flat.

As our client was purchasing as a trustee of a pension scheme, the pension scheme had their own specific requirements we needed to comply with such as various restrictions to be entered against the title, specific searches to be carried out, limited liability clauses to be included and a Declaration of Trust to be prepared.

Due to the complexity of the title and results of our clients searches we raised extensive enquiries to ensure our client’s interests were fully protected whilst complying with the pension scheme’s requirements. For example, our clients local search revealed a gap between the boundary of the property and the nearest adopted highway.

In addition, the property our client was purchasing was subject to an existing lease and during the transaction, it transpired that that lease was to be assigned to a new tenant which introduced further requirements and investigations to ensure the correct procedure set out in the lease was followed regarding the assignment process.

The Solution

To ensure sufficient rights of way existed we advised our client to obtain a highway search in order to ascertain the full extent of the adopted highway.

As a result, we were able to satisfy ourselves that the extent of the land between the boundary of the property and the nearest adopted highway revealed in our client’s local search was indeed adopted by the council ensuring the property benefitted from sufficient rights of way and the title was not defective.

With regard to the existing lease, we had to review and report to our client and the pension scheme on the lease terms advising them, as future Landlord, on the obligations contained therein.

To ensure the correct procedure for lease assignment was followed we have requested and examined the completed Licence to Assign to ensure the Landlord’s interest were fully protected.

The Outcome

Following lengthy negotiations with the sellers’ solicitors due to complexity of title and pension scheme’s specific requirements, we satisfied ourselves as to all matters ensuring our client’s interests were fully protected and subsequently we completed the matter.

Our client and the pension scheme were extremely appreciative of our expertise and assistance throughout the transaction

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Key Facts

FACT 1
Type of Property - The property being purchased was mixed use i.e. a shop being commercial in nature with a residential unit above it

FACT 2
Due Diligence - A full investigation into the title was carried out to comply with the pension schemes requirements and to protect our client’s interest in the property

FACT 3
Access – The required enquiries were raised in respect of access and further searches were carried out to ensure the property abuts an adopted highway. It is important to ensure the property abuts an adopted highway so that you have a right of way over it and that any maintenance will be the responsibility of the local authority

Pension scheme in the purchase of a mixed-use commercial property

Key Facts

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