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Prettys and Ingleton Wood dispel common business lease myths

Landlords and tenants have been warned to take professional advice early when entering into business leases to ensure they know exactly what they are signing up for and also to help avoid disputes.

Law firm Prettys and property consultants Ingleton Wood have been dispelling myths around leases and dilapidations at Prettys’ latest Business Academy events held throughout February.

There are approximately 150,000 businesses renting premises in the East of England and many have no idea about what their obligations are under the lease in particular in relation to

dilapidations –  a breach of a lease by the tenant in relation to the repairing obligations of a property either during the term of the tenancy or when it ends.

Key points to remember are:

  1. One size doesn’t fit all

Both landlord and tenants shouldn’t expect a standard lease agreement to meet all their needs. Any specific requirements on either side should be raised and agreed in advance of the tenancy commencement and agreed in heads of terms to ensure that the parties get a lease which is right for them.

  1. Keep accurate records

Documents, plans, schedules and licenses should all be kept safe and shared with the relevant professionals. This will help people get the correct advice should any questions, problems or disputes arise.

  1. Keep communication channels open

Whether the property is managed directly or through an agent, keeping dialogue open between both parties will help ensure a better working relationship and avoid nasty surprises or disputes.

  1. Alterations are not always a benefit

If tenants make alterations or additions to suit their requirements, it is unlikely they will get any compensation for the cost of the work. They may also be liable to return the property to its original state at the end of the tenancy.

  1. Mitigate Loss

Landlords should serve the schedule of dilapidations on the tenant in enough time for them to remedy any disrepair. By having a schedule of dilapidations, landlords can be reassured about the ongoing maintenance of their property and tenants can be aware of their responsibilities.

Ross Wiltshire, Partner, Prettys said; “In order to avoid costly and time consuming disputes related to commercial leases, it is important that both landlords and tenants ensure they work closely with their professional advisors to ensure that the leases they enter into meet their requirements and they are fully aware if their responsibilities in respect of the property.”

Scott Barlow, Director of Building Consultancy at Ingleton Wood, said: “It’s important for both landlords and tenants to obtain early specialist advice. On the one hand, tenants should consider and make provisions for dilapidations throughout their lease term – it’s often an overlooked cost when considering business relocation. On the other, landlords should actively manage their properties, they shouldn’t just see dilapidations as something that occur at the end of a lease. Good communication can often avoid a long drawn out dispute.”

For more information, please visit www.prettys.co.uk/prettys-developers-club-seminars

Ross Wiltshire (Prettys) and Scott Barlow (Ingleton Wood) at the Prettys Business Academy event

Photo caption: Ross Wiltshire (Prettys) and Scott Barlow (Ingleton Wood) at the Prettys Business Academy event.

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