Leases-Leasing
Finance for Leasehold Retail Businesses - Leasehold Business Loans
A leasehold retail business is one that is operated by the leaseholder, who rents his premises from the landlord (freeholder). A newsagent, pub, fish and chip shop or other leasehold business can provide the purchaser with source of income and usually a family home. It offers a relatively cheap way to solve two of life's basic challenges: finding shelter and a livelihood - which is precisely why the UK is so densely populated with these businesses.
Most retail business premises are held on a 21-year lease (or less) at a commercial rent, and the leaseholder is usually protected by the Landlord&Tenant Act 1954, which safeguards renewal. In essence, however, a leaseholder is a "tenant" renting the premises to carry on retail business.
The real value of a leasehold business is determined primarily by the volume of turnover. Other factors such as level of rent, location and competition do have a significant bearing on value, but income is ultimately the most important factor. It must also be remembered that even the best-equipped business, set in a prime location, will be worth only fraction of the going-concern value, if it is closed.
At least 25% of them change ownership each year, so it is probable that every week around 20,000 buyers are looking for a commercial loan in a financial marketplace where there are precious few sources of finance.
Similarly, it would be reasonable to assume that many existing owners of retail businesses will require a commercial loan during the course of a trading year in order to either buy out a partner, discharge an outstanding VAT bill or refurbish their premises and will usually encounter rasing funds from the usual High Street sources.
easy4life Loans and mortgages can provide you with access to leasehold business loans for variety of leasehold businesses ranging from Retail Outlets such as general stores, newsagents, off-licenses, post office stores, DIY shops, Dry Cleaners, Drug Stores to Catering Businesses such as Pizza/pasta/kebab/fish & chip shops, takeaways, cafes, snack bars and all other types of fast food outlets. Finance is also available for Pubs, Wine Bars, Bistros and types of restaurants.
The lending terms are:
Max loan considered is ?250,000 or 60% of purchase price or valuation whichever is lower. The facility will be payable over half the unexpired term of the lease or a maximum of 120 months. If additional security is available then 100% of purchase price is available with a lower start monthly payment plan.
For refinance of existing business the maximum that will be considered is ?100,000 or 50% of the valuation whichever is the lower.
Safaraz Ali, Independent Finance Adviser, easy4life Loans & Mortages-Birmingham UK. http://www.easy4life.blogspot.com |
Safaraz Ali
Tags: Finance, Leasehold, Retail Businesses, Leasehold Business Loans, Business Loans, Uk MortgagesSimilar articles
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