DILAPIDATIONS
WHAT are they
Dilapidations are integral to any commercial lease, as they define tenant liability for the maintenance and repair of property under the terms of their lease.
A dilapidations claim is normally prepared by the Landlord’s Surveyor who produces a Schedule of Dilapidations and Quantified Demand, which is then served on the Tenant.
We work with both landlords or tenants pre and post lease expiry to negotiate and agree each parties’ respective liabilities as determined by the leasehold documentation, including liaison with agents, valuers and lawyers where applicable.
DO YOU OWN OR OCCUPY A PROPERTY WITH A LEASE EXPIRY IN THE NEXT 12 MONTHS?
NOW IS THE TIME TO SEEK ADVICE.
Prior to agreeing a lease, the tenant should agree a Schedule of Condition whereby the landlord agrees that the acquired space does not need to be in better condition at the end of the lease.
To be best prepared, tenants should be considering dilapidations up to 1 year in advance of a move. Doing so in advance of any moves, allows time to establish with the landlord whether they would rather the works were carried out prior to the lease termination or a financial settlement. Typically, landlords will prefer a financial settlement so a tenant is better positioned if they propose to do the work. It is advisable to keep a dilapidations fund throughout the lease to avoid cash flow complications when the move does happen.
Absolutely! Tenants should be made aware of a landlords intentions at the end of the term, and the dilapidations liability of a tenant is always limited to the loss that the landlord would suffer if repairs were not carried out in accordance with the lease terms. If for example, the landlord was planning to convert a commercial property to residential, the condition of the space is less a factor and there will potentially be no valid claim.
