Do I need legal advice for an office lease?

1tppt1

Hi there

I am in the process of signing a 5 year commercial lease for an office owned by my local council. We managed to get it for a discounted rate as it might be demolished (with 6 months notice) for a new supermarket if planning permission is successful (although this was recently turned down).

Does anyone know of any services I can use to review the terms of the lease in order to understand the liabilities of building damge etc (which are the only issues I am really concerned about - I don't have any concerns about use as the council used it as an office. They are also insuring the property)?

The solicitors I've spoken to so far are quoting £1500+ for a review service and for a rent of only £4000p.a. it seemed quite a lot....


Many thanks in advance!

Mistral001

If you send it to me I will review it for £100. Not an expert, but I can read and I have access to a very good dictionary.

Seriously though, you could have a go at reading it yourself.

lincroft1710

If the £1500 solicitor said you would be an idiot if you took this £20,000 lease (as that's how much you're signing up for) would that be a waste of money.

Remember, leases are written for the owner's benefit not the lessee's.

bris

Are you sure they are insuring the property? In a commercial lease it's normal to have a full repairs and insurance liability, this means that, yes they will insure the building only (not contents) and bill you for the premium. It also means you are liable for all the repairs to your part of the building. If you have viewed the property you need to make sure there are no major repairs going to be needed in the near future as you are going to have to pay for them, so you could at least get a survey done.
There may be some legal jargon in the lease that you may not understand but google is your friend for those ones, apart from that, the rest of the lease is self explanatory and you should be able to determine most of it yourself.
Remember that if the lease is for 5 years you will be stuck with it for 5 years even if you fail. The only way out would be to find a new tenant the council agree too.

P.s I don't in any way recommend signing a commercial lease without a solicitor, commercial leases can be very complex.

bionic_banjo

Hi,

Get on 'People per hour.com' as promoted by this website and float this work for a fixed price. There are hundreds of RICS qualified Chartered Surveyors who are out of work due to the collapse in the market at the present time and they would only be to happy to give you some excellent advice for a few quid. Make sure they are close to the office location so they can physically take a look at it.

Solicitors start from about £120 per hour plus VAT. A Chartered surveyor with a firm will start from about £80 per hour plus VAT. A (decent) freelance Chartered Surveyor will start from £25-£30 per hour.

There are various tricks in a lease you have to look our for - in particular the repair clause so you are right to raise this. You do not want to be liable to leave the property in a better state than what its in when you take it on so please take advice rather than be sorry.

Hope this helps.:j

paulwf

Could you just rent space in a serviced office instead? Having shared amenities might mean less costs for everyone and will give you more flexibility, especially as you won't be tied into a lease.

To be clear I've never rented office space but if you can get away without having to take on a lease that would be worth a small premium.

paddyrg

5 years is hefty. If the place can be demolished at 6 months notice from their side but you're tied in for 5 yrs it sounds like a crappy deal to me - get your own lawyer as unlike a domestic tenancy, you're signing up for extra liabilities which may cost you way more than the agreed rent.

If you can accept the 6 month uncertainty, you may find somewhere smaller/more transient actually suits you better - try asking local existing businesses if they have a backroom/whatever you can sub-rent from them - many will be glad to get some semiregular cash for a bit of free space in the current economy and you may find you can work out a deal where they include leccy and shared loos etc in the deal, maybe even on a rolling month/whatever. Certainly you may find the terms more flexible than a full-on commercial lease from the council.