Irwell Valley occupies around 20,000 sq.ft. of offices space in three separate locations including two floors (11,000 sq.ft.) at Paragon House in Old Trafford.
As Irwell Valley plan their exit from three existing buildings, they want to ensure that they minimise their dilapidations and re-instatement liabilities. As ever, the drafting of each individual lease contract is critical.
In my experience, dilapidations and re-instatement liabilities are often misunderstood by tenants. Most see them simply as an obligation to re-decorate and make good. The reality can be quite different, however. For example, in one recent case we negotiated a nil cash settlement. Twelve months earlier, the landlord had quoted our client £192,000 to “redecorate and make good”!
When applied correctly, concepts such as diminution and supersession can dramatically reduce a tenant’s liability. Similarly, a well-documented lease with a Schedule of Condition or a standard handover specification attached to it, can also have a significant impact. The key is taking professional advice at the earliest opportunity and ideally, at the start of the property acquisition process. That way, many of the hidden traps and pitfalls that tenants often encounter can be avoided.
If you are nearing the end of a lease or you about to acquire new premises and would like advice on your repairing and/or re-instatement liabilities, please call John Crowley on 0161 457 1422 or email him at jc@tenantag.co.uk.