When buying (or taking a lease of) commercial property in England and Wales, due diligence is the investigation that confirms you are getting good title, free of nasty surprises, and that the property is fit for your purpose. Skipping it can be very costly. Here is a plain-English guide to what commercial property due diligence involves.
Why it matters
Property is high-value and largely "buyer beware", the law expects the buyer to investigate before committing. Once contracts are exchanged, it is generally too late to raise problems. Good due diligence lets you price the risk, negotiate, or walk away.
Title investigation
The starting point is the legal title:
- review the official copies of the register and title plan from HM Land Registry to confirm the seller owns what they are selling and to identify the extent of the property;
- check for rights and burdens, easements (rights of way, services), restrictive covenants, mortgages/charges, and any rights benefiting the property;
- for leasehold property, review the lease terms (rent, repair, alienation, break, service charge) and any consents needed.
Pre-contract enquiries (CPSE)
The buyer raises pre-contract enquiries of the seller (in commercial deals, the standard Commercial Property Standard Enquiries (CPSE)) covering occupation, disputes, outgoings, services, environmental matters, VAT, and more. The seller's replies are relied on and can give rise to a misrepresentation claim if untrue.
Searches
A range of searches flush out issues not on the title:
- Local authority search, planning, building regulations, roads, and local charges;
- Environmental search, contamination and flood risk;
- Water and drainage search;
- Chancel repair, mining and other location-specific searches as relevant.
Planning and building compliance
Confirm the property has the right planning permission for its use (and your intended use), that any works had planning and building-regulations consent, and that there are no enforcement issues.
MEES (energy efficiency)
Check the Energy Performance Certificate (EPC) and the Minimum Energy Efficiency Standards (MEES): it is generally unlawful to let commercial property with an EPC rating below the minimum (currently E) unless an exemption is registered, important for landlords and investors, as standards are tightening.
Occupational leases (investment purchases)
If you are buying a tenanted building as an investment, review the occupational leases (rent, terms, covenant strength of tenants, rent reviews, breaks and arrears) since they drive the income and value.
Other checks
- Surveys, a building survey for condition/structural issues.
- VAT, whether the seller has opted to tax (affecting SDLT and cash flow).
- SDLT, calculate the Stamp Duty Land Tax due and budget for it.
- Insurance, service charge accounts, and statutory compliance (asbestos, fire safety).
Key takeaways
- Commercial property is largely "buyer beware", due diligence before exchange is essential.
- Investigate title (HM Land Registry copies and plan; easements, covenants, charges) and raise CPSE pre-contract enquiries.
- Carry out searches (local authority, environmental, water/drainage), and check planning/building compliance and MEES (EPC minimum E to let).
- For investments, review occupational leases; also address surveys, VAT, SDLT and statutory compliance.
Sources
- HM Land Registry official copies and title investigation; Commercial Property Standard Enquiries (CPSE)
- Local authority, environmental and water/drainage searches; planning and building regulations
- Minimum Energy Efficiency Standards (MEES) / Energy Performance of Buildings Regulations; SDLT (Finance Act 2003); VAT (option to tax)
--- This article is general information about the law of England & Wales as at 2026, not legal advice. For advice on your circumstances, consult a qualified solicitor.