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In South Australia, a conveyancer plays an important role in the sale of commercial property.

A conveyancer is a licensed professional who specialises in property transactions and is responsible for preparing documentation and overseeing the requirements of that documentation leading into settlement.

The conveyancer’s role in the sale of a commercial property in South Australia includes:

Contract of Sale: The conveyancer will prepare or review the contract of sale to ensure that it is legally valid, complies with relevant laws and regulations, protects the interests of their client and reflects the intentions of the parties.

Form 1: The conveyancer will prepare or review the Form 1 (being a disclosure document that a Vendor must serve on a Purchaser) which includes the conveyancer either reviewing or obtaining necessary searches to check if there are any encumbrances or outstanding debts on the property, such as mortgages, caveats, or easements.

Settlement Documents: The conveyancer prepares and lodges various legal documents with relevant government departments and local government authorities, such as a transfer of the land to effect a change in the ownership from the Vendor to the Purchaser.

Settlement: The conveyancer facilitates the settlement process, which includes coordinating the transfer of funds, arranging for the registration of the new owner with the Land Titles Office, and ensuring that all legal and financial obligations are met.

Being a Trusted Adviser: The conveyancer can advise their client (either the Vendor or Purchaser)  throughout the transaction of any potential legal issues or risks and recognise when legal advice from a solicitor may be required.

The process of a residential property transaction and a commercial property transaction in South Australia differs in several ways.

Here are some of the main differences:

Legal Framework: The legal framework for a residential property transaction is generally more straightforward compared to a commercial property transaction as residential properties are subject to more standardized laws and regulations that are designed to protect the rights of individual consumers.  In contrast, commercial properties involve more complex legal frameworks that require specialist knowledge and expertise to navigate.

Contract of Sale: The contract of sale for a commercial property is usually more complex than that of a residential property.  Commercial properties may have complex lease agreements, licenses, or permits that need to be addressed in the contract of sale along with GST and other considerations that might be required to meet legislative requirements. In addition, commercial property transactions may require additional clauses beyond the standard contract format that require a higher level of skill and knowledge.

Due Diligence: Due diligence is typically more extensive for commercial properties than for residential properties. Purchasers of commercial properties often conduct more extensive inspections, such as environmental assessments and building inspections, to ensure that the property is suitable for their intended use and these additional requirements need to be reflected in the contract.

Financing: Financing for commercial properties is often more complex as commercial lenders typically require more extensive documentation and conduct their own due diligence to assess the risk associated with lending on commercial properties.  In addition, commercial properties may require larger contributions from owners and higher interest rates.  

Taxation: Taxation for the owners of commercial properties is also more complex as different legislation can apply (GST, capital gains tax and land tax) the implications of which need to be considered in conjunction with the ownership structure intended to be used.

 

For the reasons highlighted above, it’s important you choose a conveyancer who has experience with commercial transactions. Use our Find a Conveyancer tool and under the filter option, you can select conveyancers who specialise in this area.

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