When a personal guarantee has to be given in order to give a lender the security it needs, the guarantor hopes that the guarantee will never be called in. However, when it is, the loss suffered by the guarantor will normally qualify as a loss for Capital...
Under the Leasehold Reform, Housing and Urban Development Act 1993 (as amended by the Commonhold and Leasehold Reform Act 2002), qualifying tenants have the right as a group to purchase the freehold of their building. This is commonly known as Collective Enfranchisement. The building must also qualify.
As this is a group activity, the process can be time-consuming and laborious. As well as advising on the legal technicalities, we can assist you in co-ordinating the work and avoiding unnecessary delay.
The benefits of acquiring the freehold of the building include:
- Taking charge of the management of the building and the respective service charges, insurance and ground rent.
- Granting the participating tenants new uniform 999 years leases for nil premium.
- Enhancing the saleability of the leasehold interest.
- Receiving income from the non-participating tenants from collection of the ground rent and chargeable premium for granting new leases.
A premium will be payable for the freehold and should be calculated by a specialist valuer. We would be happy to recommend and instruct a valuer on your behalf.
As with a statutory lease renewal/extension, the process is started by the participating tenants serving a formal notice. This notice has a contractual effect and triggers a strict statutory timetable and liability for the landlord’s costs. Therefore, we advise you seek professional advice before starting the process.
For further information please contact:
Andy Finkel (Harrow) on 020 8422 5678