I didn’t know I needed you…
... said Simon A recently, in relation to taking a commercial lease on retail premises for his previously (mostly) online retail business, writes Fiona Brownfoot, director, retail and leisure, Hicks Baker.
Having successfully run his company online for several years, he decided to take the plunge and expand by taking a physical store. Having never taken a commercial lease before, he acknowledged that he naively thought that it was possibly like taking a lease on a residential property, but the presentation of a 78-page lease written in legalese soon led him to feel rather out of his depth.
While he had a solicitor representing him to deal with the legal aspect, his initial concern which led him to seek the services of a chartered building surveyor, related to the physical condition of the property. He was concerned about the numerous pages in the lease which related to his repairing liability, and as the unit was in a ‘shell and core’ condition he also required advice on the fit-out works that he needed to undertake.
Having found a building surveyor to advise specifically on the condition, that surveyor suggested that what he also needed was advice from a general practice chartered surveyor to help on all the other key terms. Such terms typically include the length of lease; whether there are any breaks in the lease; the timing and conditions of those breaks; the rent and when it’s payable; the rent-free period; the basis and timing of a rent review; planning issues relating to use; the nature of the repairing obligation; how alterations will be dealt with; who is to bear what costs relating to the legal documentation (eg agreement for lease, lease, rent deposit deed and licence to alter); conditions relating to how and when the property can be used; how the property must be returned to the landlord at the end of the lease and the difference between a lease with statutory protection and one without.
A general practice surveyor who specialises in commercial property, can assist with all these aspects and should be engaged as early in the process as possible – preferably as soon as it has been decided to search for a commercial unit, as the surveyor can also assist in this phase of the process and they may be aware of opportunities that are not generally on the market. If this is not possible, they should certainly be consulted before any offer is made so as to minimise the risk of signing what could otherwise be a very onerous legal document and costly commitment.
While most people will have an awareness of what a chartered building surveyor does, unfortunately the same cannot be said of general practice chartered surveyors but at least Simon now knows what we do.
If you have any queries about any aspect of commercial property, contact me ...
0118 9557083 • 07770 470 214
