Successful commercial rentals start with an understanding of the market and an effective strategy when it comes to putting your property on the market to let. If you are a landlord who wants to let their commercial property, whether it’s a warehouse, storage unit, office space or retail unit, you would need to consider the following:
Property type, size and layout – each commercial property has its own tenant demand, and you need to consider whether you want to let it “as it is” or “refurbished”. Another approach would be reconfiguring the layout as some smaller units could let faster.
Instruct a chartered surveyor or commercial agent – working with a RICS-accredited surveyor or commercial agent would give you huge advantages such as:
Advice on market rents, lease terms, business rates and incentives.
Guidance on planning permission and use classes verification.Access to various online markets such as Rightmove Commercial, OnTheMarket, LoopNet UK and many more.
Representation during negotiations and thorough guidance through Heads of Terms and the due diligence process.
Preparing your property for letting – you would need to ensure compliance with EPC regulations (currently EPC rating ≥ E is the minimum legal standard), safety checks such as asbestos, electrical and fire safety, and any necessary repairs you would need to carry out to the property. Also, an important part of a successful letting is to present the property in a professional, clean and accessible way.
Understanding the key commercial lease principle – your commercial agent or solicitor would be in the best position to advise you on the following legal requirements when you start preparing the lease:
Landlord and Tenant Act 1954 – what are the tenant’s rights to renew?
Full Repairing & Insuring (FRI) lease – what is the repairs structure and does the tenant cover most repairs?
Rent review – how to set out the rent review clause and process.
Service charge – how to structure service charge mechanisms.
Dilapidations – end of lease repairs and who is responsible for them.
Case Study
Location: Bedfordshire / Hertfordshire border
Size: 958 sq ft
Our client owns an office building which was not in good condition when the previous tenant vacated.
After inspecting the office spaces, our commercial property surveyors recommended that the landlord install a new toilet and kitchenette on the ground floor and upgrade the lighting throughout the building. We were successful in identifying a tenant in a matter of weeks.
For more information or to find out how we can help you, please contact me.
