No matter where your business is located, if the government decides it needs your property for public use, it has the right to exercise “eminent domain.”
This is a tricky situation for business owners. Not only is the cost of new commercial real estate increasing each year, but the cost of relocating is a major challenge, too. Especially for businesses like auto bodies, airports, cafes, or manufacturers that have massive and specialized equipment, finding a new destination and transporting your shop is a hurdle.
So what are your options when threatened with eminent domain? In this article, we will cover:
- What eminent domain is
- Is forced business relocation is legal
- The Uniform Relocation Act
- Other reasons for business relocation
- How to get started with business relocation
What is Eminent Domain?
Eminent domain is the compulsory sale of private land to the government for public use. It’s most common when building roads or new public infrastructure. In fact, the government must prove that the property is intended for public use. However, this is defined broadly and eminent domain can be used for expansion of private companies if the economic benefits are deemed important enough. For example, a private utility company wants to obtain land for a new pipeline or power project that will supply reliable energy to the public.
Historically, eminent domain was used for building railroads, post offices, and courthouses. In modern times, it tends to be for highways, roads, public infrastructure, and utilities.
Is Forced Business Relocation Legal?
Forced business relocation is legal, but the government can’t just take your land. There’s a process, and it usually begins with the government or private company tendering an offer to buy your property outright, without going through the eminent domain process.
If you don’t want to sell or feel the offer isn’t fair, here’s what can happen next:
- Negotiation
Eminent domain must include “just compensation” for the owner. This means the offers are typically based on a fair appraisal of the property. If you feel the offer isn’t fair, you can counteroffer, or negotiate. At this point, the process will continue in one of two ways: you’ll reach a settlement agreement, or you’ll go to court.
- Condemnation Lawsuit
If you don’t settle outside of court, or you refuse to sell, the government will file a lawsuit and let the court decide if the compensation is just and if the land is required for public use. The court has the ability to determine a fair value. Whatever is decided in court will be final.
- Transfer of Ownership and Payment
After a settlement or court approval of the lawsuit, the government will pay the owner and gain the title to the property, whether or not the owner agrees with the sale.
What is the Uniform Relocation Act?
The Uniform Relocation Act is designed to assist businesses that are under threat of relocation due to eminent domain. Accepting a fair price for your property is one facet of the process, but the costs associated with finding a new location and moving can add up.
The Uniform Relocation Act requires that if the federal government forces you to move for a public project, they must provide compensation for moving and business re-establishment. This applies to both forced moves, like in an eminent domain situation, as well as voluntary moves, like if the government offers to purchase your property and you agree without a lawsuit.
Sea Con is experienced in helping businesses relocate under the Uniform Relocation Act. If you are currently under threat of eminent domain, get in touch and we can help you understand your options. Since we know the details of the Uniform Relocation Act, we can advise you to ensure you get the reimbursement you need to cover your relocation expenses.
What Are Other Reasons for Business Relocation?
Eminent domain isn’t the only reason businesses must relocate. Here are some other common reasons:
Business Acquisition & Mergers
When a company is acquired or part of a merger, sometimes businesses are required to relocate personnel or equipment from one location to another.
Lease Termination or Rent Increase
In leased spaces, if rental increases are higher than the operating business can afford, they may be forced to find new space. Additionally, some landlords may choose not to renew leases if they want to sell their space or make use of it for another purpose.
Increased Operating Costs
For those who own their spaces, taxes, utility bills, or other costs of operating a space may grow over time, requiring business owners to choose to relocate.
Building or Infrastructure Defects
If your brick and mortar operation is housed in a building that has issues making it unsafe or uninhabitable, you might be forced to move. Similarly, if access to your location is blocked by a lengthy construction or roadwork project, moving may be a better alternative.
How Can I Relocate My Business?
Relocating a business is much different than moving house. Especially if your building has specialized equipment, you’ll need to consider the requirements of that when searching for a new space.
Sea Con helps businesses relocate whether they are forced to relocate or voluntarily moving. We can help you find your next location or build it from the ground up with our steel and hybrid building systems.
After that, we’ll efficiently move your equipment with an expert touch — making sure any complicated, fragile, or heavy machines are treated carefully to avoid damage.
Get in touch with us today to learn more about our business relocation services.
