If your business has recently been issued with a Schedule of Dilapidations and a bill for payment, you may be shocked at the amount you are liable for. The good news is that in many cases, costs for dilapidations can be negotiated down with professional help. Here we look at the ways in which a dilapidations bill may be reduced.
If you are in receipt of a dilapidations bill, the first thing you would be advised to do is to seek your own dilapidations assessment. This report, undertaken by a Chartered Surveyor, will detail both works required and the likely budget costs for reinstatement within the terms of your lease.
If you had a Schedule of Condition undertaken prior to your lease, the Surveyor will detail your repair and redecoration obligations to return the property to the same standard. Without a Schedule of Condition, the tenant will need to foot the bill to a minimum acceptable standard, which can mean they will become liable for fixing pre-existing defects which existed at the start of the lease.
Once you are in receipt of your own dilapidations assessment, each element can be reviewed and compared to the dilapidations bill. There may be some elements that immediately seem to be inflated in price, which can be questioned.
Furthermore, the extent to which repairs should be completed and what can be considered a ‘reasonable’ standard are often up for debate. A landlord’s schedule will often factor in costs for a high standard of finish. However, this may not always be necessary or legally required, which can mean significantly cheaper repair costs.
Depending on the wording of the lease itself, there may be other areas of a claim that can be reduced or removed altogether. Compliance issues can come into play here – although a property owner may demand compliance with statute, unless there is specific reference to this in the lease, they may not be able to demand the tenant meets these obligations.
If you are able to undertake works prior to exiting the property, this can also reduce the cost of a Dilapidations bill.
Prevention is almost always better than the cure and responding quickly to any issues that arise in the property you lease and undertaking necessary repair work can help reduce issues becoming more serious and costly in the future. A proactive approach can be taken in the form of a Planned Preventative Maintenance programme; a structured way of assessing the property’s condition on an ongoing basis and dealing with repairs and redecoration as per the plan.
Lea Hough’s Building Surveying team has a strong track record of defending dilapidations claims and reducing the costs tenants are liable to pay. Example of this can be seen in our previous blog. For more information, please get in touch.