A pre-lease survey may identify unknown or expensive items that require attention, and thus can help you negotiate better terms with your landlord. For example, a survey might be used to:
- Production of a schedule of condition to limit the tenant’s repairing liability that is appended to a lease prior to commencement. Helping you to identify problems that require attention, and help you negotiate that the landlord undertakes any such works prior to you signing the lease.
- Pre-lease building survey and report to establish the condition of the premises prior to lease agreement that may be used to negotiate terms or to limit liability.
- Help you negotiate a financial capital contribution from the landlord equivalent to the cost of remedying the defective problems, or, an equivalent rent-free period; or
- Allow you to negotiate that you are not to be held responsible in future for repairing certain items, by the agreement of a Schedule of Condition being attached and referenced in the new lease.
A schedule of condition is a document that simply records the condition of a building at a particular moment in time.
It has two main uses. Firstly, to record the condition of a building at lease commencement – prepared on behalf of a tenant to limit their future dilapidation repairing liability. A well-advised tenant who has a schedule of condition prepared can save thousands of pounds at lease termination by requesting a schedule of condition be attached to their lease.
The second situation where a schedule of condition is often used is where the works involve The Party Wall etc. Act 1996. If a building owner wishes to carry out works to party walls or floors, or undertake certain excavations, then a Party Wall Award must be produced. A schedule of condition is prepared on the adjoining owner’s building to record its condition, prior to the building works commencing.
It is then later re-examined to see whether the building works have caused any additional damage to the adjoining property. If any extra damage is noted over and above that recorded in the schedule of condition, the building owner carrying out the works will have to compensate or remedy the defects on the adjoining property.
Post-lease (Dilapidations) Surveys
The issue of dilapidations can be a very fraught and expensive area connected with properties held on leases. Whether you are a Landlord or a Tenant, if handled incorrectly they can often cost parties a considerable amount of money. Our full professional dilapidations service contains the following:
- Detailed inspection of the lease to establish the liabilities arising from the lease covenants.
- Client advice of the situation and the options available to address the matters arising that will assist you to meet your objectives.
- Completion of a detailed survey of the premises.
- Production of a Schedule of Dilapidations / Scott Schedule for service on the tenant.
- Production of a response to a Schedule of Dilapidations / Scott Schedule on behalf of a tenant taking consideration of legislation and the mitigating factors.
- Meeting and negotiation with the landlord’s / tenant’s surveyor to finalise the claim.
- Production of a Schedule of works and obtaining competitive tenders from contractors.
- Contract administration of the works to completion.
If you are a tenant, ensure you consider your dilapidation liabilities early. Costs of dilapidation repairs, decoration and reinstatement works can be a considerable expense to any organisation. If not carried out before the end of a lease, the landlord is often entitled to recover further substantial monies from you, for items such as professional fees, loss of rent and VAT, all of which could have been reduced or even avoided if, as a tenant, you had carried out the works yourselves.
By having a Dilapidation Assessment report prepared, you can establish the likely costs involved early on, to enable you to develop a strategy for either carrying out works, or reaching a negotiated cash settlement with your landlord. If you have been unable to plan in advance, and you have already received a claim from your landlord, we can assess the claim and try and reduce this by negotiation.
If you would like to discuss any of the above please contact plymCo at firstname.lastname@example.org.