Paying for commercial premises often represents the lion’s share of operating costs for most new businesses. Not many new businesses can afford to buy a freehold property so taking on a lease is often the only available option. If you are considering taking a lease of commercial premises it is worth taking professional advice to ensure you are fully aware of your rights and responsibilities.
Mark Carlisle a partner at Beviss and Beckingsale’s Axminster office says:
“It is important to get the right premises on the right terms which are suitable for present and future needs. Taking on a lease is a big commitment. Irrespective of whether a business is successful or not, its needs might change during the term of the lease. Therefore, it is important to fully understand the rights, responsibilities and restrictions under a lease before efforts can be made to properly manage the needs of the business”
Almost every aspect of a commercial lease is open to negotiation but market forces can often influence its contents. If the market favours the landlord and there is a high demand for his property, then he can negotiate more favourable terms for himself, and vice versa.
Commercial leases are often of the "Full Repairing and Insuring" (FRI) type – this means that the tenant will take on all repairing and maintenance obligations and reimburse the Landlord for all or part of the building insurance premium.
It is wise to have a qualified surveyor report on the condition of the premises to check that it is free from major defects before taking on the FRI lease. If the premises has defects when the lease is completed the tenant will probably have to remedy them.
Increasing uncertainties in the business environment have in part led to shorter leases. Some tenants are able to negotiate break clauses – this provides a safety net which enables them to terminate their lease after a certain period, but still retain the right to carry on if they wish.
Legislation including recent reforms to the Landlord and Tenant Act 1954 has an impact on a lease in ways that are not always immediately apparent from its contents. We have the commercial experience and expertise to advise on these aspects.
If you are considering taking on a commercial lease please contact Mark Carlisle on 01297 630700 or email firstname.lastname@example.org.