Buying the premises of your business may cost more than expected

Buying the premises of your business may cost more than expected

Before buying a commercial space, remember to carefully check the lease. You might have a nasty surprise.

The tenant of commercial premises, when the purchase is offered to him according to a preference clause inserted in his lease, may also have to pay a real estate agent’s commission. This tenant has a preference, but at the same price as the other candidates, under the same terms and conditions, observed the Court of Cassation.

The judges, in a decision rendered on September 28, therefore rejected the argument of a tenant who operated a clothing business and whose premises had been put up for sale by the owner. The tenant refused to pay the real estate agent’s commission. He pointed out that it had not been necessary to use a real estate agent to find him and offer him the purchase since his right of preference was registered in his lease.

The transaction is in danger of falling apart

But the right of preference inserted in the commercial lease can be exercised by the tenant when a buyer has been found. This tenant then has the right to replace the purchaser with the same rights and obligations, explains the Court of Cassation, that is to say by paying the same price. This therefore supposes paying, like this buyer, the commission of the real estate agent who had discovered it.

Consequently, the tenant who would like to use his right of preference to buy his premises, but without paying the commission of the real estate agent, could see the affair pass under his nose, for lack of having agreed to pay the same price as the prospective buyer. For residential leases, the system is different since the law of July 1989 which governs the issue requires, before any search for a buyer, to offer the purchase to the tenant in place.

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