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Ed Thorne, associate partner and head of Holiday Complexes at Stags, offers his advice on what you need to consider when putting your holiday complex on the market.
Making the most of any sale, whether it be of a holiday cottage complex or self-catering accommodation business, is going to fall partly down to the availability, and quality, of information provided to the solicitors and lenders. Creating the best possible sale environment is very much about planning ahead; In doing so, you avoid unnecessary delays, or even potential fall throughs, that will become more likely the more protracted the transaction becomes.
With this in mind, we strongly suggest involving advisors before marketing the property. This would include a solicitor, accountant and estate agent who, together, can provide you with a property health check to avoid any unexpected surprises.
1. How do your accounts look? Before marketing your business, you will want to be confident that it is in good health, ideally showing as much profit as possible. Because of this, we would recommend being prepared with 5 years of accounts for potential buyers to inspect. You will also want to factor in both your website and your social media presence remembering that a seller who knows their business well, inspires confidence to potential buyers.
2. Take tax advice. Seek out a specialist or run your plans past your accountant to check on the tax implications and liabilities involved in the sale of your holiday business. Unusual scenarios can arise, you do not want to come across any capital gains or VAT implications that you were previously unaware of as these could end up causing a significant delay.
3. Is the title registered and are there any boundary anomalies or rights of way? Everyone likes clear access or a good solution to an unexpected scenario. Dealing with the solution prior to marketing will provide your buyer with peace of mind and fill them with confidence in the transaction.
4. Have you got all the compliance certificates and documents? No matter how trivial they are, not having them could result in delays. Gas safety, electrical and private water test certificates, boiler service records, installation certificates and remedial work guarantees are all items that you will be asked to provide. We recommend getting this undertaken in good time so that you are prepared for when these enquiries arise.
5. Do you have private drainage or water? Private drainage regulations have changed in recent years and some now require discharge licences or upgrade/replacement if they not compliant with regulations. Seek professional advice if you are uncertain whether your private water supply is up to date with filtration and treatments.
6. Are all planning consents, building regulations and licences in place? Finally, check all buildings are used correctly under their planning description. If you are uncertain, Stags planning department can assist in advising and handling regularisation with a recent case of theirs, where they gained certificates of lawful use on a site with 7 units, showcasing the benefit that they can be to business owners, creating greater value and saleability for the client in question.
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