Top tips on leasing a new premises
- Credit: Archant
Whether it's your first or your 50th, taking on new leased premises can be a daunting time.
Finding the premises that you want and agreeing a rent with the landlord is just your start point. Before matters go anywhere near your solicitors, you generally need to agree some 'Heads of Terms', a document which sets out the general principles of your agreement. A proper discussion at this stage will go a long way to helping your solicitor negotiate an acceptable lease.
I believe that there are three main areas that need more consideration than is often given:
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Unlike residential leases, it is the norm for the tenant to be responsible for the building itself, whether it is an obligation to physically repair the building or whether it is through a service charge that pays for any necessary works to the building.
A 'Full Repairing Liability' can leave you in a position whereby all repairs are your responsibility, a very onerous obligation if the property is already in a state of disrepair. Extremely careful consideration should be given to this clause and to whether a limit should be agreed.
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The alienation provisions in the lease govern the tenant's ability to 'dispose' of the lease during its term, either via an assignment (transfer) or a sub-letting. Such clauses are often drafted in a way to guide how such applications are dealt with and it is very important to get this right, or you risk being left with an un-sellable lease.
Security of tenure
Whether or not your lease has security of tenure can be a very important issue. The Landlord and Tenant Act 1954 gives commercial tenants the right to renew their lease at the end of the term. This is quite often excluded within the terms of the lease, thereby denying the tenant this right.
Making sure the lease is not excluded from the Act can give you more long-term security and enable you to plan for your business in the longer term.
To find out more about Cozens-Hardy's commercial property services, call Dan Evans on 01603 724676 or visit cozens-hardy.com