Our legal services in commercial property and business acquisition
Commercial properties and business assets are two distinct legal entities.
Commercial properties:
The term “commercial property” is generally used to refer to a premise in which a business operates. Acquiring commercial properties often allows for both rental investment and strategic real estate investment. The rental yield of commercial properties is generally higher than that of residential properties, ranging from around 4% to 9%. Rental income is also more secure due to the regulation of commercial leases, typically renewable every 3 years under a 3, 6, 9 lease agreement.
Business assets:
The term “business assets” refers to the activity conducted within commercial properties. Acquiring business assets allows for the sale, storage, and provision of products or services, as well as the display of one’s brand and business name. The activity and lease are governed by a commercial lease agreement between the owners of the commercial properties and the owners of the business assets.
The owner of commercial properties can rent out the premises or operate the business assets for their own activity. In this case, there is no rent; they simultaneously act as both tenant and landlord. The benefit of owning both the commercial properties and the business assets lies in the ability to deduct operating expenses such as renovations, insurance, and depreciation of the properties for tax optimization purposes.
The process of selling a commercial or professional property is different from that of a residential property. Before signing the sales deed for the targeted property, it is advisable to draft a preliminary contract. There are several steps to follow when selling a commercial or professional property, and the sales deed must contain specific information. Both parties involved in the sale have obligations to fulfill. It is also possible to purchase a property that is already rented.
As a law firm, we can accompany you throughout this complex process. Our legal services include:
Legal advice: We provide guidance on the legal aspects of selling or acquiring business assets. This includes understanding legal obligations, drafting contracts, and negotiating terms of the agreement.
Contract drafting: We draft the preliminary contract and sales deed, ensuring they contain all required information and protect your interests.
Guidance throughout the sales process: We support you at each stage of the sale, from preparation to finalization. This includes ensuring legal compliance, managing negotiations, and resolving any issues that may arise.
Management of leased properties: If you are considering purchasing a property that is already leased, we can advise you on the legal implications and assist you throughout the process.
Our goal is to provide you with comprehensive legal support to ensure a smooth and secure transaction.
Our legal services in real estate law aim to secure and optimize your acquisitions of properties and businesses from both a legal and tax perspective.
Drafting the purchase offer
The real estate transactional attorneys at FRELA accompany and advise you in drafting your purchase offer to secure and optimize your acquisitions of commercial properties and business assets in France. The purchase offer is regulated and should include the following specific information:
- Purchase price
- Validity period of the offer
- Type of property
- Seller’s response modalities
- Withdrawal period
- Financing method
- Final value of the purchase
- Cancellation of the purchase offer
- Suspensive clauses
Review of documentation
Entrust the review of the acquisition documentation for your commercial property and business asset acquisitions to competent, experienced, and recognized transactional attorneys.
Verification, drafting, calculation, and control of the elements
Property title ; Sale agreement ; Notarized documents ; Taxes and duties; Easements and charges ; Copies of identification documents ; Copies of family record books ; Copies of the last two tax notices ; Copies of the last three payslips for each buyer ; Simulation or financing plan proposed by a banking institution ; Proof of personal contribution ; Purchase offer ; Acquisition contract ; Verification of compliance with mandatory elements
Coordination of the parties
FRELA offers comprehensive services throughout the process of acquiring commercial properties and business assets.
For your acquisitions of commercial properties and business assets, FRELA’s transactional attorneys provide guidance and support in optimizing and securing your acquisitions through a service that coordinates and monitors the actions taken by the parties involved.
Creation of REIT (Real Estate Investment Trust) and drafting of articles of association
An REIT, or Real Estate Investment Trust, is a legal entity whose purpose is related to real estate. To create an REIT, it is necessary to establish the company like any other business in France.
In the context of acquiring commercial properties and business assets, an REIT offers numerous advantages. With the drafting of appropriate articles of association, the rights of each shareholder regarding the real estate and the terms of sale can be stipulated. The REIT also allows for the optimization of taxation on the acquired property by deducting a portion of the purchase costs and expenses related to maintenance and repairs. Additionally, an REIT can provide tax optimization opportunities for inheritance and donations.
Review of the acquisition contract
FRELA provides a review of your contract for the acquisition of commercial properties and business assets. We ensure that your acquisition contracts are secure and optimized to your advantage, based on your specific needs. With the support of the FRELA team, we help you avoid pitfalls, prevent disputes, navigate tax and legal constraints, and ensure compliance with your obligations and rights.
Transactions for the purchase of commercial properties and business assets must be concluded through a written agreement, such as an authentic deed or a contract for the transfer of business assets. After the buyer submits an offer, the seller can decide whether to accept or reject it.
Tax structuring for the acquisition of commercial properties and business assets
- Analysis of the individual tax situation of the acquirers of the business assets or commercial properties
- Legal and tax analysis of the assets to be acquired
- Analysis of the acquisition structure
- Tax analysis of the transaction
- Tax planning
- Transfer of tax residency Implementation of transmission mechanisms
- Advice on the creation and establishment of dedicated entities
- Assistance during negotiations
- Assistance in managing tax disputes in case of disputes with the tax authorities.
Drafting of urgent agreements
FRELA can assist you in drafting your urgent agreements.
If you have tight deadlines, it is essential to secure and optimize the drafting of your urgent agreements.
The purchase transactions of business assets and commercial properties must be concluded through a written agreement: the real estate purchase contract or acquisition contract.
The contract should include a number of rights and obligations for both the buyer and the seller. Acceptance of the contract is deemed to occur after signing, payment of all or part of the price, commencement of performance of obligations, and will incur the liability of the contracting parties.
Creation of dedicated companies for real estate acquisitions
Creating dedicated companies can be advantageous in terms of management and taxation.
Dedicated companies, with the drafting of appropriate bylaws, allow for the specification of the rights of each shareholder regarding the real estate property and the terms of sale. Creating dedicated companies also enables the optimization of the taxation of the acquired property by deducting a portion of the purchases and expenses related to maintenance and renovations. It also provides opportunities for tax optimization in the context of successions and donations.
Contact us and share your real estate purchase project with us.