TENANTS
OF
CONDITION
MAKING GOOD
MAKING GOOD
Commercial Tenants
We can assist at different stages in the process from before you enter a Lease agreement through to the end of the Lease. Our professional expertise will ensure that you are informed about the technical aspects of the Lease and how this may impact on your business, and we can will work with your Solicitor to look after your interests.
Top tips when entering a Lease agreement.
- Choose a Solicitor experienced in property matters who has established relationships with Surveyors and other property professionals. They will provide sound advice to avoid potential pitfalls when entering a Lease Agreement.
- Consider the lease type being offered. These are usually one of the following:
- Full Repairing and Insuring (FRI) – as the name suggests the Tenant has full responsibility for repairing and insuring the Leased property.
- Internal Repairing (IR) – This usually applies where the Tenant leases a part of a building. They are responsible for the space that they occupy and will pay the Landlord a separate contribution (a ‘service charge’) towards the shared internal parts and external items such as the roof, windows etc.
- Check what your repairing, maintaining and renewal responsibilities will be under the Lease – not doing so can lead to you paying for expensive works that you may not have considered or budgeted for.
- Understand that you will have to carry out any work required under the Lease conditions that has not be completed during or at the end of the Lease. The alternative is to make a payment to the Landlord in exchange for not doing the work.
- Consider the condition of the existing property – for older properties it is best to have a detailed survey carried out to highlight any issues and avoid costly surprises. A Schedule of Condition is evidence of the condition of the property at the start of the Lease and will protect you against having to make good defecst that were already there when you moved in. This can take different forms dependent on Client requirements (see below).
- Keep your lease and survey documentation safe (preferably with duplicates in different places) – losing your documents weakens your negotiating position when the Lease ends.
Overview Inspection and Verbal Feedback – some prospective Tenants looking at a number of potential properties for lease do not want to have detailed surveys carried out for properties which they may not progress to Lease. In some cases we can carry out a joint visit with the Client and give a brief verbal assessment based on what we see. If the Client decides they are interested in the property a more in depth survey can be arranged. Due to its nature this type of survey is invoiced on a time charge basis.
Schedule of Condition Surveys – For property Leases, the protection offered ny having a clear and detailed Schedule of Condition prepared is a ‘no brainer’. It becomes part of the Lease document and ensures fairness when it comes to assessing necessary repairs at the end of the Lease. The cost of its preparation is usually small when compared to potential savings in works costs. Dependent on your requirements schedules can take different forms, the main ones being:
- A photographic document providing images showing general condition and notable defects
- A full schedule with text and photographs giving a condition assessment on a area by area basis
Having written and photographic evidence of the condition of the property at the start of the Lease is the easiest way to avoid being caught out when the Lease ends. The protection provided by this information is dependent on the level of care and attention to detail applied by the Surveyor.
Repairing and Maintenance Liabilities – we can help organise your pre-planned and reactive maintenance works to comply with your obligations under the lease term. We produce clear professional specifications for contractors to price and apply in carrying out required repairs. We can also supervise site works to ensure they are carried out to a high standard. We would deal with any technical queries from the contractor and keep you informed as the works progressed.
Small Works Projects – we can assist with procurement and management of tenant additions and alteration works, dealing with Architect, Structural Engineers and the Landlord (or their Agent) and supervising the works.
Dilapidations and Reinstatement Works – We can assess reinstatement works needed with reference to the schedule of condition (where applicable) and the schedule of dilapidations (a list of repairs needed that is prepared by the Landlord or their Surveyor). We can work with contractors to make good the premises and return it to the Landlord in the condition required by the Lease.
Some clients prefer to negotiate financial settlements with the Landlord in lieu of carrying out dilapidations works. Due to infrequent demand and the need to maintain current pricing information, we no longer offer this service to our clients.
We are happy to discuss your requirements before and during the Lease term and we can advise you on the best approach to suit your needs.