BUYING A LEASE

Purchasing a lease (In Spain it is called “Trespaso”) on a bar is the most popular way of buying a business in Spain. It is a much more cost effective way than buying a property ”freehold”.
A lease is usually bought by way of an upfront purchase price. That buys a new lease at terms stated in the contract. The normal way of securing the lease is by paying a deposit of 10%.
The length of the lease is agreed at outset and normally will range from a period of 5 to 25 years. Occasionally an endless lease is offered but these are very rare. Should you reach the end of the lease you have an automatic right to renew the lease without a further lump sum payment, providing you have kept upto date with rent payments and have kept within the terms of the lease.

As general rule during the lease the following apply

    • The agreed rent will be paid on time every month
    • You can run the business according to the terms of the lease (for example as a bar)
    • Although you can alter the decoration, theme and furniture within the bar, you are unable           without the express permission of the landlord, to structurally alter the premises
    • Your landlord will be responsible for any external repairs or structural work
    • You will be responsible for the upkeep of internal fittings
    • You will be responsible for the service bills (i.e. Electricity, water, community fees, terrace        tax, etc.)
    • Your rent will increase each year by the rate of inflation
    • At the end of the lease should you wish to renew the landlord can increase the payment by            upto 20%.

Should at anytime you wish to sell the lease you can at a price determined by yourself. You usually have to pay your landlord a fee of between 10 & 20% of the price. The amount is written in the contract at the start of the lease.
When you take over the lease you will have to provide your landlord with a security deposit of 2 months rent. This will be returned to you when the lease is sold, providing you have kept the premises in good condition. You will also need to pay 1 moths rent in advance

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