Q. I have been given the opportunity to purchase the share of the freehold on my property located on a very nice development here within Canary Wharf. I have been told that the current freeholder has put the opportunity to purchase the freehold out to the general market and we as leaseholders will be given the opportunity to match the highest bid. I am perfectly happy with the way the development is being run at the moment and wondering if there is any real advantage to pursuing the purchase?
A. Given that you are happy with the current freeholder it’s obviously frustrating that you now have to consider other options. It’s clear that you have two choices here, either you do nothing and just allow the freehold to be sold to another party and hope they continue in the same manner as you have been accustomed to, or you decide to explore the option of purchasing along with your fellow leaseholders. There are pros and cons associated with purchasing a share of the freehold. Obviously to move forward with this in the first place you will need to have a majority of owners wanting to purchase with you. The advantages being, autonomy of decision making processes in the future, ability to influence management decisions to include the appointment of agents and staff, control of future costs, ability to maintain standards. The disadvantages include, costs both the speculative costs of investigating the opportunity and the actual cost of the purchase, the need to get involved to progress the transaction and finally the possibility that the estate becomes controlled by a small number of leaseholders, albeit at the discretion of the majority. As a whole though most owners seem to prefer owning a share of the Freehold where possible as it does obviously give you far more say and control over the Estate and how things are run.