Selling a Commercial Property in a Body Corporate
Selling a commercial property that is part of a body corporate (also known as a strata scheme) requires more preparation than selling a standard standalone property. Buyers will assess not only the property itself but also the financial health and management of the body corporate. Being well prepared is essential to help maximise your sale price and avoid delays during the sales process.
Be Prepared
Ensure you Gather All Relevant Documentation
You must have ready the following documents for purchasers to review:
- Body corporate disclosure documents
- Current levies and budgets
- Insurance details
- Meeting minutes (usually the last 2–3 years)
- Any by-laws
- Sinking fund information
- Details of any planned maintenance or special levies coming up
You may need to contact your body corporate to supply this information and they may charge a small administration fee.
Do Be Transparent
If there are known issues with the building complex—such as water ingress, structural repairs or upcoming major works, make sure you disclose them right from the start, this way you will retain trust and may not loose the sale but the buyer may factor it into their pricing.
Do Understand Your Outgoings
Buyers will want a clear picture of the property’s ongoing costs, including:
- Body corporate levies
- Council rates
- Water charges
- Insurance contributions
- Any special levies
Providing an accurate breakdown allows buyers to assess the property’s true on-going costs.
Do Highlight the Positives
Commercial properties within well-managed body corporates often offer significant advantages, including:
- Professionally maintained common areas
- Shared building insurance
- Strong presentation
- Lower maintenance responsibilities for owners
- Established management structures
- Rules to protect the uses within the complex to ensure everyone has a professional environment and less disputes
Don’t Assume Buyers Understand Body Corporate Rules
Commercial body corporate by-laws may regulate:
- Signage
- Business operations
- Car parking rules
- Exclusive use areas
- Fit-outs and renovations
- Operating hours
- Building uses, noise levels and omissions/smells
- In a retail body corporate environment special uses such as a café or pharmacy may only be allowed in one of the units of the complex
Make sure your commercial agents fully understands the rules of the Body Corporate.
Financial Position of the Body Corporate
This is extremely important for an incoming purchaser when considering the property. A poorly managed body corporate with low sinking fund balances, high arrears or ongoing disputes can concern buyers. Understanding the financial health of the scheme allows you and your agent to answer questions confidently and address concerns before they become obstacles.
Do Choose an Experienced Commercial Agent
Selling commercial strata property requires specialist knowledge. An experienced commercial agent understands how to explain body corporate matters, lease structures, outgoings and investment returns to prospective buyers.
The Bottom Line
Selling a commercial property within a body corporate is about more than presenting the premises well, it also means demonstrating that the building is well managed and financially sound and the rules of the complex are reasonable. By preparing your documentation, being transparent about costs and future works, and working with an experienced commercial real estate agent, you’ll give buyers the confidence they need to proceed and improve your chances of achieving a successful sale.
Disclaimer This article is general in nature, and outlines general market trends and a general analysis of one or more particular areas. This article should not be construed as providing financial advice (particularly as to whether a reader should or should not invest in a particular area). For financial advice we recommend that readers contact a licensed financial planner to obtain specific advice that takes into account their particular circumstances. Top Property Agents Australia Pty Ltd is not licensed to provide financial advice under the Corporations Act 2001 (Cth) and related legislation.