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Dilapidations, Surveys & Fit-Out

Southwark Bridge Road, SE1

Scott Schedules, Pre-Action Protocol, Statutory Limitation, Section 18 Valuations and Supersession are just a few of the elements in the highly complex and contentious topic of dilapidations which covers the physical state of commercial property at the end of a lease including repair and re-instatement. Now that leases are shorter and break clauses more prevalent, there is a renewed focus on dilapidations and further intervention by Government is anticipated. Landlords are after every penny, especially in recessionary times and so tenants should always look to plan ahead and negotiate hard with a knowledge of the law, the loopholes and the alternatives for resolution. Waiting for the landlord’s schedule to arrive is not an option these days, as they do not always appear before the end of the term and therefore the tenant should be more pro-active than re-active.

Building and land surveys are at the heart of the due diligence process prior to the exchange of contracts on the acquisition of commercial property. Unless there are special circumstances, a full survey should always be commissioned. This recommendation might even still apply where the repairing liability is limited via a capped/fixed service charge or a schedule of condition. What impact on the tenant’s business if the building has a defect which requires months of disruption from necessary repair works? They should also be used by vendors prior to disposal to establish the true costs of any disrepair and as a possible aid to negotiations with prospective purchasers.

The fitting out requirements of an occupier should be established at a very early stage in the acquisition process via a space audit assessment of the client’s business. This firmly and correctly establishes the client’s requirement in terms of size, design, budgets and appropriate timeline which saves time and money in the long run and avoids wasted inspections and delayed occupation. Therefore fit-out should always be fully integrated into the acquisition process for a better degree of financial control and reduced risk of failure.

Please contact us to learn more about these crucial services.