Title splitting has become an increasingly popular strategy for landlords, investors and developers looking to release value from underperforming or underutilised property. By dividing a single freehold into multiple, independently saleable, lettable and mortgageable units, owners can realise enhanced capital receipts, diversify their income streams and create a more resilient investment profile.
As with any restructuring exercise, success depends on a blend of legal foresight, careful planning and a clear commercial objective.
- Understanding the Asset and Establishing the Commercial Rationale
Before initiating a title split, it is essential to understand what you are trying to achieve.
A strategic review should consider:
- The nature, condition and layout of the existing building and how easily it can be divided (including utilities/services)
• Market demand for individual units whether residential or commercial
• Long term objectives such as retaining the freehold, selling off long leases or creating a mixed tenure model
• Hidden liabilities such as service charge requirements, rights of access and shared services
A robust assessment at this stage ensures that the project is driven by commercial reality rather than purely by the perception of value uplift.
- Legal Structuring and Land Registry Considerations
Title splitting is fundamentally a legal restructuring exercise. The drafting and registration of new titles must be approached with precision to avoid disputes or administrative burdens later down the line. Matters requiring early attention include:
- Preparation of a clear and compliant plans
- Creation of new leasehold or freehold titles that accurately define boundaries, rights and responsibilities
- Allocation of rights of way, access to services, parking and any common parts
- Consideration of service charge arrangements and management structures for shared areas/common parts
Our Commercial Property team guides clients through the process, ensuring the new titles are correctly prepared, compliant and capable of supporting onward sale, refinancing or long-term investment.
- Planning, Building Regulations and Physical Works
Not all title splits require planning consent, but many will involve physical alterations that trigger regulatory requirements. A well-planned approach considers:
- Whether change of use is required for any proposed new units
- Compliance with Building Regulations including fire separation, sound insulation and appropriate means of escape
- The practicality and cost of creating independent access, utilities and metering
- The impact on adjoining landowners or occupiers
A collaborative approach involving surveyors, architects and legal advisers’ helps ensure the split is both technically feasible and commercially justified.
Case Study: Maximising Value through a Mixed-Use Title Split
We recently acted in the purchase of a mixed-use property in Leeds City Centre. A multi-unit freehold building comprised of a retail space on the ground floor and offices on the 3 floors above. The client intended to re-configure the upper office floors and convert into 3/4 residential flats. We were instructed to split the title on purchase, which involved the drafting of compliant leases, that were completion on purchase. The units can then be sold, let or mortgaged independently.
Common Pitfalls to Avoid
A title split can unlock substantial value, but only when executed correctly. Common errors include:
- Creating titles that do not adequately define rights of access or service provision
- Ignoring mortgage lender requirements which may restrict or delay the split and lead to problems in the future
- Failing to address practical considerations such as Building Regulations, licensing or planning issues
- Overlooking the long-term management burden, particularly where multiple service users share common areas
Avoiding these pitfalls requires a structured and legally robust approach from the outset.
How Ison Harrison Can Help
Our team provides comprehensive support for clients undertaking title splitting projects, including:
- Detailed title reviews and due diligence
- Advise on the legal aspects of a title split
- Working closely with other professionals and advisers involved in the title split, to make the process simple and efficient as possible
Whether you own a single building or a wider portfolio, we help you maximise value while minimising risk, ensuring your property is marketable and investment ready.
Explore the potential of title splitting
If you are considering a title split or want to understand how your property could be reconfigured to increase value, our Commercial Property team is ready to assist. Call our team on 0113 284 5000 or email commprop@isonharrison.co.uk for a no obligation discussion with one of our specialist solicitors.
