Article
How to Sell Your Business But Keep the Properties Safely
A practical guide for Australian business owners who want to sell the business but keep the commercial or investment properties without blowing up tax, loans or cashflow.
Key Takeaway
Australian business owners can sell the trading business but keep related properties if they plan early around leases, loans, and tax. The key is converting business premises into arm’s‑length investments with secure leases of 3–5 years and stress‑testing cashflow for a 2–3% rate rise. Owners should map securities, avoid cross‑collateralisation, and coordinate with a broker and accountant so the sale price, loan structure, and new rental income safely support retirement or the next venture.
You can absolutely sell your business and keep the properties – but only if you plan the loans, leases and tax well before the sale. The core play is turning business‑used property into a clean, income‑producing investment with its own loan, lease and buffers that still stack up if business drawings stop tomorrow.
Here’s a decision‑grade framework you can work through this week.
Separate the business sale from the property so you keep control of your assets.
Step 1: Decide which properties you’ll actually keep
List every property connected to the business:
- Trading premises (owned personally, in a trust, company or SMSF)
- Warehouses, storage, yards
- Residential investments funded off business profits
For each, ask three questions:
- Would I buy this again today as a pure investment?
- Can it stand on its own cashflow at +2–3% interest? (RBA/APRA buffer style)
- Is there strong tenant demand if the business moves out?
If the honest answer is “no” to any, put that property in the “consider selling” or “debt‑reduction” bucket as part of your exit.
Step 2: Clean up loan structures and securities
Your biggest risk is messy cross‑collateralisation: one loan secured by both your home and business property, or multiple facilities all tied together.
Read this alongside our guide on cross‑collateralisation traps.
Key actions before you go to market:
- Map every security: which loans are secured by which properties and guarantees?
- De‑link where possible: refinance so each key property has its own stand‑alone loan.
- Isolate business‑purpose debt: create separate splits for business funding you’ve taken against property, with clear records (supports fact 17–19 in your hub).
This matters because:
- Buyers (and their banks) hate complex security webs.
- You need the freedom to sell the business (and maybe some gear) without being forced to sell property to release guarantees.
- It sets you up to refinance on pure investment terms post‑sale.
Worked example – de‑linking before exit
- Business premises value: $1.5m
- Home value: $1.8m
- Combined loan: $1.7m secured by both
If you sell the business for $1m and want to keep both properties, your goal before listing is to:
- Refinance to two loans, e.g.:
- $900k investment loan on the premises
- $800k owner‑occupied loan on the home
- Release any business‑only guarantees over the home where banks will allow it.
Then the sale proceeds can reduce debt or fund retirement, not just plug structural problems.
The strategy continues below
You've seen the problem and the groundwork — now unlock the exact steps our CPA-certified brokers use, including 5 more sections. Enter your email for instant, free full access.
Free access. No spam — unsubscribe anytime. Your details stay confidential.
Frequently asked questions
Can I keep my business property if I sell the business?▾
How far before selling should I restructure my loans and securities?▾
Is it risky to rely on rent from my old premises as my main retirement income?▾
Speak with a specialist advisor
Confidential consultation, bespoke advice for your situation.