If you’re looking to purchase or sell a practice, do you have all the right documentation in place? Michael Royden explains what you need.
Many of the most successful practices operate from newly built or newly refurbished premises. At the same time, there are a number of practices that operate from older premises, which have been restructured over the years, in some cases with premises that were previously separate being drawn together.
Whichever type of surgery a dentist operates from, there are some common issues that we find in relation to surgeries which can cause problems in the future. These issues can, as a minimum, delay a sale of the practice, and at worst can prevent a sale being completed.
Building warrant and completion certificate
Like any building, surgery premises may have been altered over the years for a number of reasons. Where that is the case, it is essential that the proposed alterations are approved by the local authority before they are carried out. That involves the submission of an application for a building warrant, which makes the local authority aware of the alterations that are planned and the issuing of a building warrant permits those works to be carried out.
Once the works are carried out, an application then needs to be submitted for a completion certificate. The council will then inspect the property to confirm that the works have been done in accordance with the building warrant. They will then issue a completion certificate.
Unfortunately, we see a number of instances where a building warrant is in place but there is no completion certificate. In those cases, either a retrospective certificate will need to be applied for, or a letter of comfort needs to be obtained.
There is always the potential for a local authority to be unhappy with the works at a later stage where no completion certificate was issued, and to require further works to be carried out to the building.
You should also bear in mind that if you lease your premises, your lease is likely to provide that any alterations to the building will require the prior consent of the landlord, and this is often overlooked by dentists who are tenants of a building.
It is very common for us to encounter situations where premises have been extended, perhaps by the purchase of a neighbouring flat or shop.
You should however, bear in mind that different types of property have different use classes for planning permission purposes. If you buy additional premises and change their use, it is more than likely that planning permission for change of use will require to be obtained before the works are carried out.
All commercial properties require to have an asbestos management plan and a risk assessment. This is a requirement that has been in place for a number of years now.
The obligation to have asbestos documentation is often not complied with by practice owners, and again regularly arises at the point of a sale of a practice.
Energy performance certificates (EPC)
Prior to putting a practice on to the market, the practice owner is required to obtain an EPC. This is a relatively straightforward document to obtain, and in general terms it assesses the energy efficiency of the building with a corresponding rating being attached. With older buildings, naturally the energy performance rating will be much lower than should be the case in a new build premises.
These are just some of the issues that we regularly encounter in dealing with surgery premises. Most of them are relatively easily dealt with, but if they are not addressed fully at the relevant time, they can cause considerable difficulties for the future.