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Commercial Property questions and answers Part 1

I thought that it would be useful for property tenants and freehold owners of commercial property to cover a few aspects of law which they should be aware of but sometimes are not which can create potential delays and difficulties in the event that they wish to dispose of their property interests. I will answer a few relevant questions in a three part blog.

What is an EPC and when is it necessary? – An Energy Performance Certificate measures the energy efficiency in a building using ratings A-G.  Except for a few exemptions and certain industrial units or very small units it is necessary for an EPC to be obtained for all property sales or lease assignments. Up until 1 April 2023 you cannot let commercial property with a rating of F or G and after that date with a rating of E.

Do I need to be concerned about asbestos? -Yes all commercial buildings in the UK should have a record of known asbestos and if present a plan on how it is to be managed? If you are selling commercial property or assigning a lease the buyer/new tenant will want to see an up to date asbestos survey and plan.

As a freeholder with a charge on my property will I need the lender’s consent to grant a new lease or to carry out any works.- It would be usual for any lender to require that you get its consent before granting any new leases or carrying out work. The lender has a vested interest in ensuring that you are managing the property in a manner than would not prejudice its interests should it ever need to enforce its mortgage and sell the property.

If I wish to transfer my lease to another tenant will I need my landlord’s consent? – In almost all cases you will not be able to transfer your lease without the Landlord agreeing to it and assessing the incoming tenant’s financial status. The landlord must act reasonably in deciding whether to agree to the lease transfer but can require the new tenants to put up a deposit or personal guarantee. You will also be required to guarantee the incoming tenants’ liabilities until it also transfers the lease or the lease term expires.

If I have a right to break my lease will I lose the right if I miss the notice deadline? Yes any deadlines for service of break notices are strictly enforced at law so make sure that you get your notice served within the time limits allowed in the lease.  If you are required as a condition of the notice to make sure rent is paid up to date you must pay the rent to the date specified in the lease and not just up to the break date otherwise the landlord could deny your break right.

Part 2 questions and answers to follow in the next blog in a few weeks.

If you have any Commercial Real Estate enquiries please call us on 01256 320555 or email mail@clarkeandson.co.uk to discuss how we can assist you in your plans.   

Phil Dixon

Head of Commercial Real Estate

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