Selling commercial premises is not simply a matter of putting a property on the market like any other: everything depends on its occupancy status.
Premises occupied by a business under a commercial lease are not sold in the same way, or at the same price, as vacant commercial premises.
This article explains the differences between selling tenanted commercial property and vacant commercial premises, the rules of the 3/6/9 commercial lease that apply to the buyer, and the valuation and marketing methods suited to this specialised market
In summary
- Selling occupied commercial property differs both legally and financially from selling vacant commercial premises.
- An existing 3/6/9 commercial lease is automatically transferred to the buyer, who becomes the new landlord.
- The business tenant may benefit from a right of first refusal in certain situations when the commercial property is sold. This must be checked carefully on a case-by-case basis.
- A tenanted commercial property is mainly valued based on its rental yield, while vacant premises are generally valued by comparison with similar transactions.
- The target buyers differ depending on occupancy: investors for tenanted premises, and retailers or self-employed professionals for vacant premises.
- Specific surveys and documents—including the lease, commercial co-ownership charges and inventory of fixtures—must be gathered before the property is put on the market.
Selling Commercial Premises: Occupied or Vacant, Two Different Approaches
Before taking any steps, it is essential to clearly identify what you are actually selling.
There are two very different situations when it comes to selling commercial premises.
Commercial Property Occupied Under a Lease
In this situation, you own the property itself—the “walls” (murs commerciaux)—but the business operating from the premises belongs to a third party: your tenant.
The tenant has signed a commercial lease and pays rent.
Selling the property in this situation means selling an income-producing real estate asset, comparable to a conventional rental investment but subject to specific commercial property rules.
Vacant Commercial Premises
By contrast, vacant commercial premises no longer have a tenant in place: either the property has never been rented or the lease has ended following termination, non-renewal or the tenant's departure.
In this case, you are selling a vacant property that the buyer can either use for their own business or rent out under their own terms.
This distinction determines everything that follows: the valuation method, the profile of potential buyers, the marketing strategy and even the documents that need to be gathered.
A professional experienced in this specific market, whom you can find through the Optimhome real estate advisor directory, can help you accurately assess your situation before setting an asking price.
The 3/6/9 Commercial Lease and Its Impact on the Sale
The commercial lease, commonly known in France as a “3/6/9 lease”, is a long-term contract—generally lasting nine years, with the tenant usually entitled to terminate it every three years—that provides strong protection for the business tenant.
It is essential to understand its implications before selling occupied commercial premises.
The Lease Is Automatically Transferred to the Buyer
When you sell occupied commercial property, the existing lease is not affected by the sale.
The buyer automatically becomes the new landlord under the same terms and conditions previously agreed with you: the amount of rent, remaining lease term, and specific clauses relating to matters such as the permitted use of the premises, allocation of charges and rent review.
In practical terms, this means that the buyer cannot terminate the lease or change its terms simply because they have purchased the property.
What This Means for Negotiations
This automatic transfer generally reassures investors, who are specifically looking for a secure rental income stream over several years.
However, it may discourage a buyer who wants to operate their own business from the premises. They will have to wait until the lease expires or negotiate an early departure with the existing tenant, which may involve a cost, such as compensation for leaving the premises.
It is therefore essential to clearly state in the property listing the remaining duration of the lease, the next three-year break date and the rental terms, as these factors directly influence the property's value and the type of buyer likely to be interested.
The Business Tenant's Right of First Refusal When the Property Is Sold
One particular point to consider is the right of first refusal that may apply to a business tenant when the owner decides to sell the commercial property they occupy.
Under French commercial law, this mechanism may require the landlord to inform the tenant of their intention to sell and offer them the opportunity to purchase the property as a priority, subject to specific price and timeframe conditions.
However, this right of first refusal does not apply in every situation. Certain sales are excluded, such as the sale of an entire building containing several commercial premises, a transfer within the same group, or a sale to a close family member of the landlord.
The precise conditions depend on the circumstances of each case.
Given the technical nature of these rules and the potential consequences of failing to comply with them—including possible cancellation of the sale—it is strongly recommended that this point be checked by a notary or specialist lawyer before signing any documents, rather than relying solely on general information found online.
An Optimhome advisor experienced in this type of transaction can also direct you towards the appropriate professionals to secure the process
How to Value Commercial Premises
The valuation method for commercial premises differs depending on whether the property is tenanted or vacant.
Using the wrong method can easily result in the property being overvalued or undervalued.
Rental Yield for Tenanted Commercial Premises
When the premises are rented, their value primarily depends on the rental income they generate.
The most commonly used method involves applying a yield rate, determined according to the business sector, location and quality of the tenant, to the annual rent excluding charges.
For example, if commercial premises generate €24,000 in annual rent and the expected yield in the relevant area is 6%, the estimated value would be approximately €400,000 (€24,000 / 0.06).
This rate varies considerably depending on the geographical area, the financial strength of the tenant and the remaining term of the lease.
A prime location occupied by a strong national brand may command a lower yield rate—and therefore a higher value—while premises in a less dynamic area occupied by a financially vulnerable independent business may require a higher yield, resulting in a lower relative value.
Comparison Method for Vacant Commercial Premises
For vacant commercial premises, where there is no rental income to value, the approach is different.
It is closer to the method used for conventional residential property: comparing the premises with recent transactions involving similar commercial properties in the same area, based on criteria such as floor area, location, shop frontage, accessibility and overall condition.
The absence of a tenant also means there is no immediate rental income, which may reduce the property's value compared with an equivalent tenanted property, unless it is in a particularly sought-after location where it can quickly be re-let on favourable terms.
In both cases, an online property valuation can provide a useful initial indication, but it should be supplemented by a detailed assessment from a professional who understands the local commercial property market, as valuation differences for this type of property are often considerably greater than in the residential market.
Who Buys Commercial Premises?
The profile of the potential buyer depends directly on whether the property is occupied or vacant, which has very practical consequences for how your listing should be presented.
Investors for Tenanted Commercial Premises
Commercial premises occupied under an existing lease mainly attract private or professional investors looking for a property investment that generates regular income.
These buyers focus on rental yield, the security of the rental income and the quality of the tenant, much like with a residential rental investment, but with generally longer commitments due to the 3/6/9 commercial lease.
Retailers or Self-Employed Professionals for Vacant Premises
Vacant commercial premises are more likely to attract buyers who want to operate their own business from the property: independent retailers, franchisees, tradespeople or self-employed professionals such as medical practitioners, agencies or consultancy firms looking to establish or expand their business.
These buyers focus on different criteria from investors, including shop-front visibility, pedestrian traffic, accessibility, potential for refurbishment and compliance with regulations for premises open to the public.
Identifying this target audience in advance makes it possible to adapt the sales approach and the channels used to advertise the property. This is an area where a professional, through Optimhome advisors' property listings, can provide genuine added value compared with selling the property yourself.
Surveys, Documents and Precautions Before the Sale
Selling commercial premises requires a more comprehensive file than a conventional residential property sale because both property law and commercial lease rules apply.
Mandatory Technical Surveys
The usual property surveys are still required for commercial premises: Energy Performance Certificate (DPE), risk and pollution report, asbestos survey where the building is subject to the relevant regulations, and potentially electrical or gas installation surveys depending on the configuration of the premises.
These documents must be attached to the preliminary sale agreement, as with any property sale.
Documents Relating to the Lease and Commercial Co-Ownership
If the premises are occupied, you must provide the existing commercial lease, any amendments to it, the tenant's inventory of fixtures on entry—and on departure, if available for a previous tenant—as well as a record of the rent and charges invoiced.
When the premises are located in a co-owned building, particular attention should be paid to commercial co-ownership charges, which can differ significantly from those applying to a conventional residential unit.
These may include the maintenance of shared commercial areas, specific operating costs such as lifts, shopping arcades and security, and sometimes complex allocations between commercial and residential units within the same building.
The latest minutes of the general meeting, the co-ownership regulations and details of charges for the previous three years should be prepared in advance to avoid delays when the sale is signed.
Precautions Not to Overlook
Common mistakes include failing to check the contractual permitted use of the premises—the activities authorised by the lease or co-ownership regulations—failing to check whether there are any ongoing proceedings with the tenant, such as unpaid rent or litigation, and underestimating the time required to clear any right of first refusal held by the tenant.
As with any unusual property, professional support can help anticipate these difficulties. Issues relating to specific properties, such as selling a parking space or garage or selling an unusual property, share the same need for a tailored approach that differs from the standards of the conventional residential market.
Work with an Optimhome Real Estate Advisor to Sell Your Commercial Premises
Selling commercial premises, whether occupied or vacant, remains a more specialised and technical market than residential property.
There are fewer potential buyers, they tend to be more experienced, and their decision-making criteria—including yield, location and lease terms—require the listing to be presented precisely and with supporting information.
Targeted Rather Than Mass Marketing
Unlike residential property, which can appeal to a broad audience, commercial premises should be marketed by specifically targeting the right type of buyer: investor networks for tenanted premises, and networks of retailers, franchisors or self-employed professionals for vacant premises.
A local advisor experienced in this type of transaction generally has a network of contacts and detailed knowledge of the local economic environment, two advantages that are difficult to replicate when selling alone.
You can also consult Optimhome business listings to see how this type of property is usually presented and valued on the market.
Support with Legal and Tax Matters
Beyond marketing, working with an Optimhome advisor can help secure the legal aspects specific to this type of sale: checking the lease, managing any applicable right of first refusal, coordinating with the notary and anticipating tax issues relating to the sale, including whether the capital gain is treated as professional or private depending on your circumstances.
This expertise usefully complements that of the notary, who is required for signing the deed but does not generally become involved in the marketing and negotiation stage.
As with residential property, it is also useful to anticipate all the costs associated with the transaction. For comparison, the article on the real cost of selling a property provides a useful overview of the expenses to consider, although certain costs specific to commercial property, such as registration duties and potential VAT, may also apply.
Conclusion
Selling commercial premises requires a clear distinction from the outset between two very different situations: premises occupied under an existing commercial lease and premises that are vacant.
- An existing 3/6/9 lease is automatically transferred to the buyer under the same terms and conditions.
- The tenant may have a right of first refusal when the commercial property is sold. This should be checked with a legal professional before making any decision.
- The valuation method differs fundamentally: rental yield for tenanted premises and market comparison for vacant premises.
- The target buyers differ depending on whether the property is occupied or vacant.
- A file containing the required surveys and specific documents, including the lease and commercial co-ownership charges, should be prepared in advance.
Given the technical nature of this market, working with an experienced professional remains the best way to sell under the right conditions, at the right price and without unexpected legal issues.
FAQ
Can Commercial Property Be Sold Without the Tenant's Agreement?
Yes. In principle, the owner is free to sell the property without the tenant's agreement, as the lease simply continues with the new buyer.
However, depending on the circumstances, a right of first refusal may require the tenant to be informed of the sale in advance, without requiring their “agreement” in the strict sense.
What Happens to the Lease if the Commercial Premises Change Ownership?
The existing commercial lease is not affected by the sale. It continues under the same terms and conditions, with the buyer simply replacing the seller as landlord.
The tenant therefore does not need to take any particular action.
Do Vacant Commercial Premises Sell for Less Than Occupied Premises?
This mainly depends on the location and how quickly the premises can potentially be re-let.
As a general rule, vacant premises may have a lower value than occupied premises already generating secure rental income, unless they are in a particularly sought-after location for retailers or professionals looking to establish their business quickly.
How Do I Know Whether the Tenant's Right of First Refusal Applies to My Sale?
This depends on several factors specific to each case, including the nature of the sale, the relationship with the tenant and the configuration of the building.
An incorrect assessment can have significant consequences. It is therefore recommended that you have your specific situation reviewed by a notary or specialist lawyer before putting the property on the market.
Which Surveys Are Required When Selling Commercial Premises?
The standard surveys remain necessary, including energy performance, risks and pollution, and asbestos where the building is subject to the relevant regulations.
These are supplemented by documents specific to the commercial activity, such as the existing lease and the history of commercial co-ownership charges where applicable.
Do I Need a Specialist Professional to Sell Commercial Premises?
It is not a legal requirement, but this smaller and more technical market generally benefits from professional support to value the property correctly, target the right buyers and secure the aspects relating to the commercial lease.
Does the Sale Price of Commercial Premises Include the Business?
No. The sale of the commercial property itself is legally separate from the sale of the business (fonds de commerce), which includes the commercial activity, customer base and leasehold rights and belongs to the business operator.
An owner who sells only the commercial property does not therefore sell their tenant's business.
Author :
Fabrice DOBROWOLSKI - Optimhome Network Development Director
Optimhome offers you personalized support for your real estate project. Benefit from all my advice, based on several years of experience, to ensure the success of your project.
