Commercial Leases – Why Tenants Should Insist On A Schedule of Condition

It is very often the case that where a tenant is taking a lease of a commercial property, be it a shop, an office, or an industrial unit, the landlord will require the tenant to maintain the property in good repair and condition during the period of their occupation. Tenants, in these cases, also need to be aware that the lease will most likely require them to return the property back to the landlord in good repair and condition when they vacate at the end of the lease.

A tenant must, therefore, be aware of the future repairing liability that they will be taking on by carefully examining the wording of the lease. They also need to ensure that they limit, as much as possible, future liability for potentially sizeable and costly repairs. For example, a tenant may be unaware that a central heating boiler is effectively obsolete, or that the condition of the roof is very poor. A full repairing lease would mean that the tenant has to carry out costly and extensive repairs, or potentially replace these at their own expense.

One very effective way of limiting the potential for these nasty shocks is to have a Photographic Schedule of Condition prepared and attached to the lease. This has the effect of providing a photographic and descriptive record of the condition, at the outset of the lease, so that a tenant is not required to return the property to the landlord in any better condition at the end of the lease. As such, it limits the risk of a large dilapidations claim from the landlord after the tenant has left the property.

This is something that a tenant’s solicitor should insist on incorporating in the lease. MJ Boaden Chartered Surveyors are experienced in preparing Photographic Schedules of Condition and work closely with a number of solicitors in this area. If you are looking to take on a commercial lease, please contact us to find out how we can help.

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