Stephensons advised a client in a difficult transaction including the purchase of a pharmacy business with an expired lease for its existing premises.
Commercial property Partner Kate Bullen, who advised on the transaction, was advised by the client that they wished to proceed with the purchase of the business regardless of there being no long term right to occupy current pharmacy premises. Our client was advised to wait until the seller had completed a new lease which could then be assigned to them thus giving our client the security that they could occupy the premises for a longer period of time. If a new lease was not completed our client could have been given six months’ notice at any point to vacate the property despite any premium they may have paid for the purchase of the pharmacy business. We were successful in persuading our client to wait for a new lease to be negotiated.
During the course of negotiations for a new lease the pharmacy premises were sold to a new landlord. Kate Bullen ensured the seller of the pharmacy business served a section 26 notice on the new landlord seeking a renewal of the expired lease. As a result of the notice it became apparent that the new owners were not going to renew a lease and instead planned to demolish the building. This led to the seller closing the pharmacy and relinquishing its pharmacy licence.
Our client had originally agreed to pay £300,000 for the business. If the transaction had completed without a lease in place, they would have lost a significant amount of that investment. They have now applied to the General Pharmaceutical Council for the pharmacy licence that the seller relinquished with the intention of opening a new pharmacy in new premises in the same area.