The dream of running a shop is high on a number of people’s wish list but before you sign a lease make sure you get a detailed commercial property survey.
Commercial property surveys tend to be more complex than a residential survey because the buildings are often larger and commercial properties are subject to a broader range of legislation. In addition, you may well be leasing the property which will be subject to a number of repairing and maintaining obligations within the lease. But don’t be deterred, here are a number of issues to consider before entering into a lease:
- Commercial Building Survey: get a building survey. The benefits of commissioning a building survey are that it gives you an understanding of the condition and design of the property. It also helps establish the suitability of the property for its intended use; helps outline the need for, and quantifying, future costs and other liabilities; and provides a basis for negotiation with the vendor or landlord.
- Schedule of Condition: prepare a schedule of condition. This is a report that will be prepared by a building surveyor and attached to the lease. It lists the current condition of the property at the start of your lease and will reduce your liabilities when you come to terminate the lease. It goes into a lot of detail and will be accompanied with photographs. They don’t take long to produce and we would recommend that you share a copy with your landlord and agree with them that it is a fair reflection of the condition of the property you are leasing.
- Dilapidations: Ensure you know the dilapidations liabilities. This refers to the condition of the property at the end of your lease and any changes to the building (both interior and exterior) that may have happened under your tenancy. It is essentially a building survey of the premises to assess the condition of the property, any ‘mistreatment’ or to flag-up poor maintenance. This is to protect the landlord and ensure the property is handed back in the condition in which it was leased, and hence the importance for you to undertake a Schedule of Condition at the start of the lease. It is worth noting that if you have made changes within the property without the landlords consent they can issue a Schedule of Dilapidations and insist you make repairs before the end of your lease.
For more information and advice on how MCP can help you navigate commercial leases, contact us.