Guide

Buying business premises

Most businesses looking for premises will decide to rent, however, there are some circumstances where it might be preferable to buy a property.

In this section

  1. 1. Buying your own premises: advantages and disadvantages
  2. 2. Costs relating to buying and operating premises
  3. 3. Finding the right premises to buy
  4. 4. Making an offer for a property
  5. 5. Using a surveyor when buying premises
  6. 6. Using a solicitor when buying premises
  7. 7. Concluding contracts on a property

Guide 6 min read

1. Buying your own premises: advantages and disadvantages

Businesses looking for premises will usually choose to rent. But there can be advantages to buying a property.

  • Gaining an asset.Your premises can be an investment, with your property potentially gaining value over time.

  • Security. Your premises can be used as security to raise finance.

  • Flexibility and control. Buying can give you more flexibility, meaning you can alter or extend the property (subject to planning permission) and control the management and upkeep of the building.

  • Potential income. You could let out the property in the future and receive another income stream.

  • Predictable costs. You can forecast your costs with more certainty, particularly if you have a fixed-rate mortgage.

However, there can also be disadvantages.

  • Large outlay of capital. Buying can tie up capital, which could instead be used to set up and invest in your business. It may be difficult to recoup the capital quickly, or at all, if you decide to give up the business when there is a downturn in the property market.

  • Financial risk. Ownership could leave you with negative equity or the threat of repossession if you cannot keep up with mortgage repayments.

  • Cashflow. Commercial mortgages tend to be over a shorter term, so repayments can work out higher than rental costs.

  • Responsibility. You are fully responsible for the entire upkeep and safety of the building both inside and out. You will need to carry out surveys before you buy, and the premises itself will potentially cost you time in maintenance, alterations or building work.

  • Fixed location. It can be harder to relocate if your business needs change or as your business grows, as selling business premises can be complicated.

2. Costs relating to buying and operating premises

Upfront costs

When you buy a commercial property, you'll have to budget for:

  • professional fees - for the surveyor and solicitor, and any other professional advisor you have engaged

  • tax - VAT (not in every case, and if you're registered for VAT you may be able to claim it back) and Land and Buildings Transaction Tax (LBTT)

  • registration dues and fees - for registering the property deeds with the Register of Scotland and any fees associated with making searches or enquiries with the registry, local authority or Companies House

  • alterations and fitting out - you will be responsible for fitting out your premises for your business needs and your legal compliance. 

Ongoing costs

You will also need to consider the ongoing costs:

  • business rates - property tax to help pay for local council services. They are based on the ‘rateable value’ of your premises - what the property would rent for at a given date. You can estimate your bill, find out the rateable value for any rated business property on the Scottish Assessors Association (SAA) website, and investigate grants, incentive schemes, and non-domestic rates relief to help you get an idea of what these will be

  • services - local authority charges for services including waste collection and parking

  • insurance - you will need to take full property cover as part of your business insurance

  • repairs and maintenance - you are responsible for the ongoing repairs and maintenance of the property

  • running costs - e.g. lighting, heating and charges for maintenance services like cleaning or security.

  • compliance - you are responsible for the health and safety of employees and visitors, and must comply with all applicable building and fire regulations. You also need to provide a suitable working environment for employees, including:

    • maintaining a reasonable temperature

    • providing enough space, ventilation and lighting

    • providing toilets, washing facilities and drinking water

  • commercial mortgage payments - if you can't afford to purchase the property outright

  • Business Improvement Districts - Business Improvement Districts are a set area (e.g. a part of a town or a commercial district), in which businesses work together to invest in local improvements. In these districts, businesses agree to pay an additional levy on their business rates to fund local improvements. This can increase ongoing costs, however, businesses will benefit from improvements to the local trading area.

Energy Performance Certificate (EPC)

All sellers - or construction firms in the case of new buildings - are responsible for providing prospective buyers with an EPC with an energy rating. An EPC can give you a good indication of a building's energy efficiency and the likely energy costs.

In particular, air conditioning systems and boilers can have a significant effect on your overall energy bills. You can make savings by keeping these well maintained and having them regularly inspected by a qualified engineer.

The Energy Performance of Buildings (Scotland) Regulations 2025 are in force from 31 October 2026 bringing new energy efficiency requirements.

Capital allowances

It is worth investigating whether your business can claim capital allowances. Property owners could deduct some or all of the value of eligible capital expenditures from their profits before tax. This includes spend on ‘plant and machinery’, such as equipment and some fixtures, and ‘integral features’ of a building, such as air conditioning systems or lifts. 

Capital allowances can sometimes be passed on from the previous owner as part of the property purchase, however this can be a complex process. 

An accountant or surveyor could help you identify potential capital allowance claims.

Restrictions

Find out if there are any restrictions or covenants in the property deeds or imposed by the local authority that may affect your business. This could include restrictions on delivery or loading times, or other restrictions on rubbish disposal, parking, noise, lighting, litter, etc.

3. Finding the right premises to buy

The location of your business premises can make or break your business. Our article on how to choose the right premises for your requirements covers how to:

  • specify your requirements

  • choose the right location

  • how to search for premises yourself or use a commercial estate agent or surveyor.

4. Making an offer for a property

Once you have found a property, and if you are satisfied that the price is fair, you can then make a conditional offer to the agent, provided that certain conditions are met, such as:

  • a satisfactory and thorough building survey and due diligence on all restrictions, tax implications, etc

  • being able to raise the finances

  • planning permission for any alterations is granted

There may need to be negotiation with the vendor to reach a mutually agreeable figure.

If you have applied for a mortgage, you will need to have a written offer from the lender before progressing an offer.

5. Using a surveyor when buying premises

It is wise to have a full structural survey and valuation carried out, so that there are no nasty surprises later and your mortgage lender may require this also.

Surveyors - and solicitors - can also help you with:

  • deciding if the building suits your purposes

  • carrying out due diligence

  • negotiating the contract

  • making sure that the business rates are fair

  • advising you if you want to alter or improve the building

  • negotiating the right level of insurance cover and, if you ever have to make a claim, they will work with the loss adjuster.

You can also search for a surveyor using the RICS Find a Surveyor search function.

6. Using a solicitor when buying premises

Choose a solicitor who specialises in commercial property law. They will help you understand exactly what's in the contract and what your responsibilities will be if you sign it. 

A good solicitor will:

  • make sure the seller has a good title to pass on to you - in other words, that everything about the ownership of the property is in order

  • negotiate and obtain the best terms for the contract

  • carry out searches to check if there are any problems with the property

  • satisfy your bankers or other lenders that the property is a good investment

  • complete your purchase as quickly as possible.

You can search the Law Society of Scotland to find a solicitor.

7. Concluding contracts on a property

You will be ready to conclude contracts with the person selling the property when:

  • both sides are happy with the contract

  • the surveyor or solicitor has made all the necessary checks and searches on the building

  • if the sale is conditional on the seller having obtained planning permission, then all paperwork is complete

  • you have raised the necessary money.

Once you have concluded contracts, the purchase becomes legally binding.

If you are paying part of the purchase price up front - known as a deposit - you do this when you conclude contracts. You are then ready to complete the purchase and become the owner of the property. 

Prior to completion, make sure you have adequate insurance in place. On the completion day, your solicitor will hand over the purchase price - paid in full by you, or by your lender - to the seller's solicitor. 

The last things to do after completion are to:

Your solicitor receives the deeds to the property - papers giving details of the property and the owner. The deeds are then sent to the lender if you have one.

Business Gateway can give you advice on business property. Call us on 0300 013 4753.