Moving Charity Premises

A move of your charity to different premises is a major exercise. The following is a high-level checklist to get you started and to give you a sense of the scope of the exercise. Invariably you will need to follow some of the signposts at the end of the resource and take professional advice. Don’t be tempted to shortcut this as it will probably result in delays and extra cost.

 

  • A charity move may include some or all of the following:

  • Sale of one or more buildings

  • Concluding a lease

  • Purchase of one or more buildings

  • Taking on a new lease

  • Refurbishing new premises

  • Managing staff relocation issues

  • The practical move

 

Building Sale

  1. Check the Charity Commission advice for disposing of property  https://www.gov.uk/guidance/charity-land-and-property and https://www.gov.uk/government/publications/sales-leases-transfers-or-mortgages-what-trustees-need-to-know-about-disposing-of-charity-land-cc28 . You will probably need a Charities Act Report.

  2. If you own the building you are leaving check whether it is elected for VAT. This may have implications depending on whether the charity is VAT registered and on the VAT scheme in operation. If in doubt take professional advice eg http://www.sayervincent.co.uk/our-services/tax-advisory/

  3. Check whether there is any restriction on the funds originally used to purchase the building eg in case some or all of the funds released from the sale are required to be invested in another building.

  4. Look for and appoint a suitably qualified agent to market and sell the building. Spend quality time on getting the right agent. Beware of going to a residential agent instead of commercial agent.

  5. Look for a suitably qualified commercial property solicitor to handle the sale. A local conveyancer is unlikely to have the skills.

  6. Make sure you have a clean registered title and if appropriate insure any restrictive covenants.

  7. Check the class of use the building currently has. This will be of interest to potential buyers. https://www.planningportal.co.uk/info/200130/common_projects/9/change_of_use 

  8. The board of the charity will need to agree and minute who has authority to negotiate the sale and sign contracts. Check your governance document as this may need to be trustees not senior staff. It will also need to approve the sale and minute it. NB Ensure that you have signatories who are accessible at short notice. You must not agree the sale without a resolution to accept the Charities Act Report.

  9. Prepare a project plan for the sale.

  10. Prepare a budget for the sale including agents & solicitors fees.

  11. Consider using a professional advisor to come on your team to handle many of the above matters so the charity is not distracted from core mission. They may be able to save you time, money and hassle.

 

Building Purchase

  1. Check the Charity Commission advice https://www.gov.uk/guidance/charity-land-and-property

  2. As early as possible agree a description of your requirements including facilities required, location, space, layout, number of floors, parking, public transport etc. Include a specification of how the premises will be best used (See the following from Malcolm Hall of Pangolin Enterprises Ltd  https://1drv.ms/w/s!AuMYeINuORrmg5IMjgk9UibZ6hoKug )

  3. Consider appointing a suitably qualified professional such as a chartered surveyor to help you with your search.

  4. Appoint a suitably qualified commercial property solicitor for the purchase.

  5. Check whether the building you are buying is elected for VAT. If so, as a charity you may have a significant VAT bill because most of the charity’s income is probably not VATable. This may also have implications depending on whether the charity is VAT registered and on the VAT scheme in operation. If in doubt take professional advice eg http://www.sayervincent.co.uk/our-services/tax-advisory/

  6. Check the class of use the building currently has and whether it is appropriate for your requirements. If not you may have to apply to the local authority for change of use. This is by no means automatic, so be sure of it before finally committing to buy. https://www.planningportal.co.uk/info/200130/common_projects/9/change_of_use 

  7. Prepare a project plan for the purchase. Ensure you understand what happens in what order and set a realistic timescale allowing contingency for delays.

  8. Prepare a budget for the purchase, including all professional fees.

  9. Consider whether you want to raise funds for the purchase or refurbishment of the new property. You will find some funders are open to supporting capital projects, though others will only support ongoing ministry projects. A fundraising case for support which explains what you are hoping to do and how it will further the vison and mission of the organisation will be useful for this.

  10. Consider whether you may need a bridging loan or mortgage to assist cash flow eg if you purchase to refurbish before you complete on the sale eg  https://www.stewardship.org.uk/support-services/mortgages  or https://www.kingdom.bank/mortgages-for-organisations/

  11. The board will need to agree who has authority to negotiate the purchase and sign contracts. This may need to be trustees not senior staff. It will also need to approve the purchase and minute it. NB ensure that you have signatories who are accessible at short notice.

  12. Consider using a professional advisor to handle most of the above matters, as part of your team.

 

 

Refurbishment

  1. Produce an outline description of requirements to include design and style, decoration (link to corporate ID), durability, lighting, sockets. Also do a specification of how the premises will be best used (see the following from Malcolm Hall of Pangolin Enterprises Ltd

https://1drv.ms/w/s!AuMYeINuORrmg5IMjgk9UibZ6hoKug )

  1. Decide what approach you will take eg architect and building contractor or design and build by the same contractor.

  2. Set up a small project team which represents different teams in the organisation. Refurbishment is time-consuming and distracting; make sure you have the right team of people available (including professionals) who can take the project through to completion.

  3. Prepare a timetable/project plan and allow some contingency.

  4. Prepare a budget and cash flow for the refurbishment. NB Allow costs for refurnishing etc; it is not usually good stewardship to take old furniture into newly refurbished premises

  5. Commission a professionally produced, detailed specification to be used for invitation to tender

  6. You will need a tender process to select a contractor, and negotiation skills to reduce the quote to bring it within budget. NB check whether your charity governance document require 3 quotes and determine how you will manage the tender process.

  7. Produce an annual budget for the ongoing running of the building.

  8. Once refurbishment is complete put in place a rolling maintenance plan for the inside and outside of the building.

 

The Move

  1. This level of change in an organisation needs to be carefully managed. Regular and clear communication is essential, especially with staff and any “users” who will be directly impacted by the move.

  2. Make a project plan including plenty of time for sorting, packing and unpacking.

  3. Budget for all aspects of the move.

  4. This is a great opportunity for cultural  and operational change in the organisation. Ensure you are intentional about this and take the opportunity to make changes that will better reflect the values of the organisation.

  5. Agree a relocation policy and advise staff as early as possible to reduce uncertainty. https://www.gov.uk/employer-relocation-your-rights

  6. You may need to consult about redundancy, depending on how far the relocation is. Involve Member Care/the HR team as early as possible.

  7. Obtain quotes as early as possible from appropriately qualified removal companies.

  8. NB Pay particular attention to the move of IT equipment, printing equipment etc. Involve IT in your project team if you have a specialist. Make detailed plans for the impact of downtime on the organisation and its stakeholders.

  9. This is a great opportunity to sort archives and to destroy paperwork that is no longer needed.

  10. Now is the time to consider your disaster recovery or business interruption plan:  you will be doing 90% of the thinking it needs, so capture it.

  11. Notify supporters, suppliers, customers and other stakeholders of the date and change of address, including any dates the organisation will be closed during the move.

  12. Arrange for post to be forwarded by Royal Mail www.royalmail.com .

  13. Following the move change the registered office of the charity.

  14. Celebrate well!

 

Signposts

 

Author and copyright: Helen Calder 2019.

Peer reviewed by Malcolm Hall

https://1drv.ms/w/s!AuMYeINuORrmg5FlTvDRA61aamw7vw