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Dilapidations Advice for Tenants Post Covid-19

The past few months have been a difficult time for many businesses to navigate. From the immediate effects of a contraction in business and therefore redundancies, to the potential for a reduction in the need for as much office space on a long-term basis due to a shift to home-working, the full extent of the effects on businesses and commercial property are unlikely to felt for some time.

In any event, we anticipate lots of movement and activity in respect of commercial lettings over the coming months and years.

Here are the ways in which our Chartered Surveyors are able to assist business tenants when it comes to commercial premises.

Dilapidations claims upon termination of leases

Recent events may have forced businesses to re-evaluate their property needs and as a result, where they are in a position to do so, tenants may look to activate break clauses or else terminate their lease.  At the point at which a building is handed back to a landlord, an assessment of the building’s condition is usually undertaken, which can result in a dilapidations claim being issued by the landlord. Our Chartered Surveyors are able to advise tenants in relation to dilapidations claims made against them and can help to defend and renegotiate the amount that is being claimed. This can help outgoing tenants to save significantly on costs.  

Renegotiating leases

We have already received a number of enquiries from tenants of commercial building that are looking into their options regarding the size of the building they currently occupy. For some businesses, particularly those that occupy office spaces, it may be that there is now less need for as large a footprint. Tenants may therefore look to renegotiate the amount of space that they occupy, securing lower ongoing rents. Whilst this may sound like a straightforward and sensible approach, unfortunately, it is unlikely to be that simple. When businesses sign a tenancy agreement, they commit to a certain amount of space for a specified length of time. Therefore, in order to agree a lease on a lesser amount of space, they would have to end their current tenancy agreement and enter into a new one. Unless a tenant is reaching the end of their lease term or a specified ‘break’ in the lease, they are unlikely to be in a strong position from which to try and renegotiate.

Our surveyors can get involved in negotiations to help to try and secure a new deal on behalf of tenants.

Schedules of condition

Cheaper rents may start to become available over the coming months, which could tempt tenants to move into a different property. So long as tenants are in a position to be able to exit their current lease, they may find that they are able to secure a better deal in an alternative property. Our surveyors are not only able to assist in relation to any dilapidations claims that may come from exiting the previous tenancy, but can also help to secure the tenant’s position by undertaking a schedule of condition on the new property. This is a professionally prepared document that includes both detailed written descriptions and extensive photographs to give a clear record of the condition of a building when a Tenant takes possession, thereby helping to limit ongoing liability for repair and maintenance costs.

Lea Hough’s Chartered Surveyors have a vast amount of experience in advising tenants in relation to commercial buildings. Our team are also able to advise landlords in respect of their position and how to best protect their interests in their property.

To speak to a member of our team in relation to a dilapidations claim, lease renegotiation or schedule of condition, please get in touch.

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“We had a Schedule of Condition carried out on a Commercial Property. From vacant possession to our proposed completion date we were really tight on time. Gary managed to carry out the inspection and write a very thorough report in the time needed to ensure we hit our completion date. The price of the report was also extremely competitive. I would recommend Lea Hough to anyone looking for a Professional Surveyors with excellent service & communication at a competitive price.”

Danny Ambler - Fuse Contract Furniture, Blackburn