SCHEDULES OF CONDITION

 

When buying or renting commercial property, it is recommended that you obtain a Building Survey or Schedule of Condition before exchange of contracts.

 

It is advisable to commission a Schedule of Condition when you enter into a new lease of commercial premises.  The report is in schedule format, and is different to a survey report. It is a factual log of the building’s condition, not a narrative description of defects, causes and required action.

 

If you are taking an assignment of an existing lease, it is unlikely that you will be able to persuade the landlord to agree to a schedule of condition, and a Building Survey report is usually the most suitable option.

 

Please ring us if you require more advice on which report would best suit your particular circumstances.

 

In most cases, leases impose on the tenant certain repairing and redecorating responsibilities.  In many cases, leases have “full repairing” terms. This is where the tenant is responsible for carrying out (or reimbursing the cost of) internal and external repairs and redecoration.

 

For some properties, this may not seem onerous.  For others, however, the potential liability may be significant, particularly if the buildings are old or in disrepair at the start of the lease. 

 

The tenant may be able to negotiate a variation to the standard lease repair terms, for example, by asking the landlord to take on the external repairing liabilities; or alternatively, by attaching to the lease a Schedule of Condition, setting out the precise condition of the property when the lease term commences.  The lease repairing covenants will also need to be varied, to ensure that the tenant is not responsible for putting or keeping the premises in a better state of repair than as shown in the Schedule.

 

It will be necessary to obtain proper legal advice on these issues first; and of course, no matter what the tenant’s intentions, the landlord may not be prepared to accept a variation to the lease repair terms, in which case the matter will be one for negotiation between the parties.