Wednesday May 22, 2013 at 2:26pm
The changes to the General Permitted Development Order (GPDO) come into effect tomorrow.
For owners of commercial premises the following is a summary of the most important changes which will be classified as permitted development:
Change of use from offices within class B1(a) to residential dwellings (Class C3)
To qualify, the building must have been used as an office within class B1(a) immediately before the 30th April or, if it is not currently in use, was last used for that use.
Lis....
(read more...)Sunday March 3, 2013 at 4:07pm
It now looks likely that the ancient law of distress will be abolished this summer. But what does this mean for commercial landlords and tenants? The proposal was first made 22 years ago, and the legislation passed back in 2007, but it was never brought into force. But the government has recently announced that they will introduce it this summer. What it will mean is that landlords will not be able to send in bailiffs to seize goods without due notice. No longer will tenants in arrears of rent h....
(read more...)Monday October 15, 2012 at 7:36pm
With commercial property development in the doldrums the last thing you want on the development projects you do have going forward is to experience problems with the legalities of the deal. Whether it’s problems with the access rights to the land, concerns over the legal structure of the finance deal or the need for a speedy completion you don’t want to be held up by legal misunderstandings or confusion. Here are three essential steps to completing commercial property deals swiftly a....
(read more...)Tuesday September 4, 2012 at 10:00am
If you decide to rent commercial premises you’ll be expected to sign a commercial tenancy agreement or lease agreement. Before doing so it is essential that you understand what you are committing yourself to, look for options to negotiate on its terms and fully appreciate under what circumstances you can be released from the agreement.Here are just some of the aspects of the commercial tenancy agreement you will need to understand:Payment terms in a commercial leaseAlthough it may seem obv....
(read more...)Friday August 24, 2012 at 3:59pm
In hard economic times commercial landlords are often fighting a day to day battle to recover rent and enforce lease covenants. So here is a resume of the available options. Rent and Service Charges
1. Distraint: the first and most used remedy is to distrain for rent. This can also apply to service charges if they are reserved as rent in the lease. Distraint is an ancient remedy which was about to be confined to the history books, but it lives on due to a change of mind on introducing a new pr....
(read more...)Friday July 27, 2012 at 10:00am
If you’re a commercial tenant trying desperately to find the right commercial premises for your business it can be very tempting to quickly agree the terms you are offered without fully understanding the consequences. The so called ‘heads of terms’ offered by the landlord set out the main commercial terms you are signing up to, so it’s best to be very clear on what the implications are. There are some important points to consider when settling on
commercial lease he....
(read more...)Friday July 20, 2012 at 9:59am
The Government has announced a consultation on proposals to relax planning laws relating to change of use.
The main thrust of the announcement is the desire to rejuvenate the country's high streets where restrictions on change of use hamper efforts by landlords to find occupiers for retail premises.
One other change proposed however is that premises currently used as a hotel or guesthouse should be permitted to be changed to residential use without the need for planning permission.
With uncer....
(read more...)Wednesday February 22, 2012 at 1:05pm
Be pro-active. Get yourself on the front foot and ready to deal with any issues. This means understanding the terms of your lease and the type of disputes that can crop up and when they are most likely. A good start would be to sign up to our Commercial Lease Renewal service. We will highlight the issues for you and give you diary dates for action.
The most common issues with commercial leases are: 1. Rent reviews 2. Lease renewals 3. Service charges 4. Dilapidations (repairs) 5. Rent arrears ....
(read more...)Friday January 27, 2012 at 9:34am
The current difficulties small businesses are having raising finance are well known. One idea that hasn't been discussed so far in the media is one possible solution - the live/work unit.
A live/work unit is a property that combines living space and business space under one roof. The crucial issue for small businesses, though, is that the cost of buying and running live/work units is much lower than the combined cost of buying and running a home and separate business premises.
....
(read more...)Wednesday January 25, 2012 at 11:25am
As if times weren't hard enough for commercial real estate investors, David Cameron has announced that the Government is to make available unwanted Government offices at 'low rates' to businesses.
Already faced with paying business rates on offices they are unable to let out, landlords will now find that market rents are likely to fall further in the face of the Government's incentive.
Steve Petty, Commercial Property Solicitor....
(read more...)Wednesday October 26, 2011 at 1:09pm
Approaching your landlord to renegotiate your lease can be a daunting prospect, especially if you’re a small business owner and the landlord is a large institution. Making sure you are fully informed before you start the process is certainly worthwhile – although in my view there’s no better approach than asking an expert to negotiate on your behalf. I’m often asked by small business owners how they can renegotiate the terms of their commercial lease, especially those who....
(read more...)Tuesday October 4, 2011 at 9:46am
M & S has been fined £1m for breaches of health and safety legislation. The Crown Court said it had failed to protect customers, staff and workers from potential exposure to asbestos whilst refurbishment works were carried out to a store. Ceiling dust possibly containing asbestos fell to the shop floor whilst it was open. M & S were also ordered to pay £600,000 costs after the prosecution by the Health & Safety Executive.
Marks & Spencers we....
(read more...)Thursday September 22, 2011 at 11:33pm
Being a business solicitor based in Northampton I was pleased to hear the news last month that Northampton had been successful with its bid to develop an Enterprise Zone and interested to find out exactly what the benefits for local businesses would be. The Enterprise Zone is a government initiative with the aim to stimulate growth in the economy. This is particularly important given the recent negative indicators.
It has to be hoped that the attraction of being located in the Northampton....
(read more...)Friday August 26, 2011 at 11:03am
How to negotiate a Lease is one of the most frequent questions I get asked.
Before signing a Lease of business premises Tenants should always try and negotiate the best deal with a Landlord or their agent.
Listed below, in no particular order of importance, are the key things to ask for and check:
1. Get expert advice on the Rent A Tenant should not just rely on the Landlord’s view on the market rent for the property. If in any doubt get your own surveyor to give a valuation 2. Servic....
(read more...)Friday August 12, 2011 at 10:05am
Many businesses and indeed anyone who has suffered loss as a result of the recent riots may find that they are not insured. Most insurance policies exclude losses caused by riots.
But there is a possible source of compensation, if only for damage to buildings. The Riot (Damages) Act 1886 covers loss to buildings and allows claims against the Police provided they are submitted within 14 days. It has been reported that the Prime Minister David Cameron has stated that this will be increased to 42 ....
(read more...)Monday July 4, 2011 at 12:55pm
A ‘pre-pack’ is a legal process where the business and assets of a struggling company are sold immediately after it is placed into administration. As the name suggests the deal is agreed beforehand meaning that unsecured creditors (including landlords) are not given the opportunity to object.
Pre-packs are now popular as they allow the business to continue without the unprofitable parts or a heavy debt burden and can save jobs. They have also been controversial where they allow fai....
(read more...)Monday July 4, 2011 at 11:53am
Capital Allowances are a valuable form of tax relief available to commercial property owners who have incurred expenditure on various fixtures and fittings.
Capital Allowances are available in two situations. Firstly when a commercial property is purchased for occupation or investment purposes and secondly when a new commercial property is built or fitting out/refurbishment works are undertaken.
The rules relating to Capital Allowances are typically very complex but in simple terms they are ....
(read more...)Tuesday May 31, 2011 at 10:18am
What is Forfeiture? Forfeiture is the landlord’s right to re-enter business premises and bring a lease to an end. In general a lease can be forfeited where the tenant does not pay the rent, breaches the other terms of the lease or becomes insolvent.
Forfeiture is a powerful tool for landlords to use where they wish to remove a tenant and terminate the lease. Tenants should note that the right to forfeit can only be exercised by the landlord if it is specifically referred to in the lease.....
(read more...)Wednesday April 6, 2011 at 12:20pm
From today (6 April 2011) residential property with a purchase price of more than £1m will be subject to a higher Stamp Duty Land Tax (SDLT) rate of 5%. This increase only applies to land which consists entirely of residential property. It does not apply to commercial or mixed used property where the SDLT rate remains at 4%
Steve Petty Commercial Property Solicitor 01926 629 005....
(read more...)Wednesday April 6, 2011 at 11:02am
If you are a tenant in a multi-let building/estate and reimburse your landlord for the electricity supply then you will be interested to hear about your new rights. Recent changes give tenants the power to demand cheaper electricity costs from a different supplier.
A tenant may now notify their landlord that they want to receive electricity from another supplier and the landlord must respond within 21 days or risk committing a criminal offence.
This will benefit those tenants that believe th....
(read more...)Tuesday April 5, 2011 at 5:49pm
Over the past few weeks I have received many enquiries from property owners looking to minimise the amount of business rates they pay whilst their property stands empty. This is a particularly important issue since the threshold for claiming Empty Property Rates Relief was reduced from £18,000 to £2,600 this month.
Property owners therefore need to review tactics to minimise liability for business rates by adopting new initiatives.
The Meanwhile Scheme was introduced by the gover....
(read more...)Friday April 1, 2011 at 3:58pm
The Court of Appeal has recently ruled that the demolition of a building can come under the definition of a "project" under EU Law.
Why is this important? Under normal planning rules the demolition of a building does not require planning permission
This case means that where demolition is likely to have a significant impact on the environment planning permission and an Environmental Impact Assessment will be required i.e. in most cases.
Please note there are special protections th....
(read more...)Friday April 1, 2011 at 3:33pm
As of today (1 April 2011) many property owners and businesses will be hit with a large increase in business rates for empty property.
The rateable value where no business rates are payable by an owner of empty property has been cut from £18,000 down to £2,600.
I have already received many enquiries from worried business people and property owners seeking ways to reduce their liability.
Eligible businesses should not forget to make a claim for ....
(read more...)Friday April 1, 2011 at 3:17pm
The temporary increase in Small Business Rate Relief has been extended by a further year to October 2012 Small Business Rates Relief is available to all businesses whose rateable value is less than £12,000. This means that eligible businesses occupying one property with a rateable value of £6,000 or less will pay no business rates. For those with one property having a rateable value of between £6,000 and £12,000 there will be relief on a sliding scale from 100% to zero. A....
(read more...)Thursday March 31, 2011 at 1:08pm
Budget 2011 – Property Now that the dust has settled after the Budget Report last week it would be a good time to summarise the main implications for the property world. Business Rates The temporary increase in small business rate relief has been extended by a further year to October 2012 This means that eligible businesses occupying one property with a rateable value of £6,000 or less will pay no business rates for that period. For properties with a rateable value of between £....
(read more...)Thursday February 17, 2011 at 9:10am
Leasing business premises can be a real minefield for the unwary business owner. In this series of posts I shall go through the various aspects of a commercial lease to explain some of the legal jargon and also provide some lease negotiation tips along the way.
E is for Entry - rights of
Almost all leases will contain a right for the landlord to enter the premises in certain circumstances. You don't want the landlord just barging in when he feels like it, though, so it's important t....
(read more...)Wednesday February 2, 2011 at 12:24pm
The Government has announced that from 1 April 2011 the empty property business rates threshold will revert to £2,600 from the current level of £18,000.
This will be a matter of great concern for SME’s and commercial property owners who have any empty premises in their portfolio.
The only crumb of comfort is the extension of Small Business Rate Relief until October 2012 for those that are eligible. See here for details.
This will result in businesses with e....
(read more...)Wednesday January 26, 2011 at 11:26am
Business rates are one of the largest costs to SME’s but many are unaware of the tax relief available.
A business in England that occupies only one commercial property is entitled under the rules to have their bill calculated using the small business rate multiplier where the rateable value is under £18,000 (£25,500 in London).
There is also the temporary business rates cut for businesses occupying one property where the rateable value is under £12,000. See my earlier....
(read more...)Monday January 3, 2011 at 6:35pm
Below are my 5 key talking points for the property market over the next 12 months:
1. Interest Rates
With continued high inflation becoming a concern it is likely that the current ultra low interest rates will begin to rise steadily later this year. This could lead to a higher volume of properties being marketed for sale in 2011 as loan repayments increase.
2. Bank Finance
I expect the same hard slog in 2011, with a continued lack of Bank finance availability for property investment and d....
(read more...)Thursday December 9, 2010 at 4:59pm
When negotiating a lease you should always ask the landlord or their agent whether they comply with the voluntary codes of conduct that aim to promote fairness for tenants occupying business premises. In this blog I have summarised what these are all about.
1. Code for Leasing Business Premises - www.leasingbusinesspremises.co.uk
This consists of 3 parts: • 10 point list for landlords to follow • Guide for tenants and occupiers • Model heads of terms
You should be ....
(read more...)Wednesday November 10, 2010 at 11:24am
Leasing business premises can be a real minefield for the unwary business owner. In this series of posts I shall go through the various aspects of a commercial lease to explain some of the legal jargon and also provide some lease negotiation tips along the way.
D is for Dilapidations
Dilapidations is yet another legal piece of jargon commonly used in relation to business premises.
The first time a tenant sees the word 'dilapidations' is usually when an intimidating looking document called a S....
(read more...)Monday September 27, 2010 at 6:55pm
Property costs are a large overhead for most businesses. Here Steve Petty lists 10 of the best ways to save money both now and when relocating. 1. Time to renew your lease? If you are coming towards the end of your lease then now would be a very good time to take control of the renewal process. It is likely you will have been locked into a lease for a few years paying rent agreed or reviewed at the height of the market. By getting good advice and following the correct procedu....
(read more...)Wednesday September 15, 2010 at 10:07am
Leasing business premises can be a real minefield for the unwary business owner. In this series of posts I shall go through the various aspects of a commercial lease to explain some of the legal jargon and also provide some lease negotiation tips along the way. C is for Covenants
The word 'covenant' is used in two very different contexts in relation to commercial premises.
'Covenant' usually refers to a promise made by either the landlord or the tenant (or the guarantor if there is one). ....
(read more...)Friday September 10, 2010 at 9:10am
Leasing business premises can be a real minefield for the unwary business owner. In this series of posts I shall go through the various aspects of a commercial lease to explain some of the legal jargon and also provide some lease negotiation tips along the way.
B is for Break Clauses
One of the most important clauses in a lease for those starting up a new business.
Many new ventures fail in the first two years of operation yet leases are frequently 5 years or more in length. The premise....
(read more...)Wednesday September 8, 2010 at 10:29am
When preparing to sell your business, it is crucial to take the right advice as this can have a big impact on the success of the sale, the amount you receive and any ongoing liability following completion. Here are 10 reasons why it is essential to use a good solicitor when selling your business: 1. Share or asset sale
The two main methods of structuring the sale of a business are to dispose of the shares or the assets. The two are fundamentally different but a solicitor will be able to advise....
(read more...)Wednesday September 8, 2010 at 10:16am
I am often asked by business owners for help when they are taking a lease of commercial premises. Unfortunately this is after the main terms have already been agreed in principle. Ideally you should get your solicitor involved before agreeing terms as various concessions can usually be negotiated that can save time and money for your business both immediately and in the future. Listed below are the 10 key points to consider when talking to the landlord or their agent: 1. Ask the landlord fo....
(read more...)Tuesday September 7, 2010 at 8:52am
Leasing business premises can be a real minefield for the unwary business owner. In this series of posts I shall go through the various aspects of a commercial lease to explain some of the legal jargon and also provide some lease negotiation tips along the way.
A is for Alienation
Well we're on our first letter of the alphabet and already we have some legal jargon to contend with. 'Alienation' is just a legal term which covers a tenant's right to deal with a lease. The most c....
(read more...)Friday July 2, 2010 at 10:04am
The temporary increase in small business rate relief has been confirmed by the new government. The increase will apply for 12 months from 1 October 2010 and means that eligible businesses occupying premises with a rateable value of £6,000 or less will pay no business rates for that period. For properties with a rateable value of between £12,000 and £6,000 there will be relief on a sliding scale from 100% to zero. For more information on how this will affect your business rates ....
(read more...)Wednesday June 30, 2010 at 4:46pm
When entering into a lease of business premises the landlord may require the tenant to provide a rent deposit. This is a sum of money equivalent to, for example, 6 months’ rent. A rent deposit gives the landlord some security in the event that the tenant fails to pay the rent on time or does not comply with its other obligations in the lease. In these circumstances the landlord can deduct sums from the deposit to cover the arrears of rent. It is crucial from the point of view of the tenant....
(read more...)Monday June 14, 2010 at 9:54am
The new PPS 3 now defines previously developed land (brownfield land) as follows:
‘Previously-developed land is that which is or was occupied by a permanent structure, including the curtilage of the developed land and any associated fixed surface infrastructure.’ The definition includes defence buildings, but excludes:
Land that is or has been occupied by agricultural or forestry buildings.
Land that has been developed for minerals extraction or waste disposal by landfill pu....
(read more...)Wednesday June 9, 2010 at 11:16am
The Government has announced that back gardens are to be reclassified for planning purposes. The effect of this is that it will be easier to for Local Planning Authorities to oppose applications from developers to develop garden land as the developer will not be able to argue that the land is 'brownfield'.
At the same time, however, the Government is also proposing that local residents have more say over development in their area. It may be the case that if a development proposal ha....
(read more...)Friday May 28, 2010 at 9:24am
April saw two of the UK's best known retailers receive significant fines for breaches of fire safety legislation. On 20 April Tesco was fined £95,000 after admitting 5 breaches of the Regulatory Reform (Fire Safety) Order 2005 and on 29 April 2010, the Co-operative was fined £210,000 after entering a guilty plea in relation to six offences. In both cases, the breaches are ones that could have easily occurred in any retail premises. Tesco was fined: £40,000 for two counts a....
(read more...)Thursday May 20, 2010 at 6:54pm
Hidden in the governments detailed coalition agreement released today are concrete proposals to limit future back garden development. The plan is to give councils new powers to stop what they call ‘garden grabbing’. Full details to follow but if you are thinking about selling off part of your garden for development now could be the time to take that step. If you have surplus land or are a developer who carries out these types of schemes then contact property lawyer Steve Pe....
(read more...)Thursday May 20, 2010 at 11:46am
It was today announced by the new government that the requirement for seller's to provide a Home Information Pack (HIP) will be suspended from 21 May 2010.
As expected Energy Performance Certificate's (EPC's) are retained and will still need to be produced within 28 days of the property being put on the market.
The practical effect of HIP's being scrapped is to shift the cost of paying for searches back to the buyer, which was always the position before they were int....
(read more...)Friday April 23, 2010 at 11:50am
The Carbon Reduction Commitment (CRC) came into force on 1 April. CRC is a compulsory carbon dioxide emissions trading scheme where large organisations are required to buy allowances based on how much CO2 they expect to emit from their buildings during the year. The CRC will inevitably have a knock on effect to small and medium sized businesses, many of which will be tenants in buildings where the scheme applies. As is the case with any commercial lease the landlord will be looking to recoup fro....
(read more...)Thursday March 25, 2010 at 10:53am
A temporary cut in business rates was announced yesterday in the Budget. This will give an exemption for businesses occupying property with a rateable value of up to £6,000, and discounts for those with a rateable value of up to £12,000. The measure is intended to last for 12 months from October. The government claims that the cut will mean more than 300,000 small businesses avoid having to pay rates but it is important to check the 2010 valuation assessment when calculating whether ....
(read more...)Friday March 5, 2010 at 11:09am
After a long wait, the Consumer Code for Home Builders comes into force on 1 April. It will be mandatory for house builders who are members of a home warranty scheme which has undertaken to enforce the Code. Home warranty bodies such as NHBC, Premier Guarantee and LABCNew Home Warranty have all agreed to require their registered builders to adopt and comply with the Consumer Code.I set out the main issues covered by the Code in this ezine article in October 2008.The Code will apply to all ....
(read more...)Thursday March 4, 2010 at 4:47pm
A case reported this week should prompt all landlords to take advantage of our free 20 minute lease review and check that the obligations of a tenant’s guarantor can be legally enforced.
This judgement will affect any lease where there has been as assignment from the original tenant and a guarantor was involved.
In short it means the continuing liability of the guarantor under a lease can be challenged. Should the tenant then fail to pay the rent then this could prevent the landlord fr....
(read more...)Tuesday February 16, 2010 at 5:07pm
When you take a car in for its service do you ever get the feeling that you have been taken for a ride quite literally?! I certainly do when given the list of parts the garage recommends be replaced. It would be useful to have some way of getting to the bottom of what really is important. This was the inspiration behind my Planning Law Guide that certainly can be as complex as the average Audi.
Take the following example. The word “Development” in planning terms does not just mean ....
(read more...)Tuesday February 16, 2010 at 3:56pm
The Government has begun a consultation process to consider granting special stamp duty concessions on the bulk buying of residential property.
At present if a buyer purchases a number of properties at the same time then potentially they will be classed as “linked transactions”. As a result stamp duty would be payable on the total amount paid rather than treating each purchase individually and this can increase the tax bill hugely. For example stamp duty for a one off purchase at &....
(read more...)Thursday February 4, 2010 at 10:07am
To mark my arrival at Cousins Business Law I've put together this list of dos and dont's for businesses to help them avoid the potential pitfalls and capitalise on opportunities during 2010.
Landlords should be proactive on recovering rent arrears to avoid being left high and dry by struggling tenants. Look out for warning signs that might mean a tenant has financial issues, like delays in payment or publicity surrounding the performance of the organisation. If it goes into admin....
(read more...)Wednesday February 3, 2010 at 10:12am
Belatedly, in the Blog anyway, I'd like to welcome on board Commercial Property Solicitor Paul Harrison.
Paul joins us from a firm with offices in Milton Keynes and Northampton and from his own Northampton base will provide legal advice to business and property owners thoughout the Midlands.
Paul, who joins Steve Petty in our
Commercial Property Team acts for a wide range of property owners and occupiers. He's especially experienced in:
Advising on all aspects of acquirin....
(read more...)Thursday January 21, 2010 at 10:49am
I have previously posted on the issue of back garden development. It looks as though the Government may be finally waking up to the fact that flaws in its planning guidance have caused rather more of this type of development than may have been desirable.
Housing and Planning Minister, John Healey, has announced that he will be strengthening national policy advice to make it clearer that garden land is not necessarily suitable for development and that decisions to stop building on it shoul....
(read more...)Wednesday January 20, 2010 at 9:36am
I have previously written about the business rates revaluation. For those businesses which may experience a large increase in business rates, the transitional relief scheme is intended to spread the impact over several years. To find out whether your business rates increase will be phased in over time, check the lists below.
Caps for small properties Small properties are those with a rateable value of below £18,000 (£25,500 in Greater London) as at 1 April 2010. The cap ....
(read more...)Friday January 15, 2010 at 5:00pm
The Conservative Party has pledged to scrap Home Information Packs (Hips) immediately in the event that they win the general election, which given their strength in the polls seems likely.
The original aim of Hips was to speed up the house buying process and to stop deals from “falling through” but most people involved in the property industry will agree that Hips in their current form have been a failure. In my own experience one of the biggest problems has been that by the time t....
(read more...)Thursday January 14, 2010 at 5:26pm
The surprise banks’ overdraft charges victory could leave landlords’ exposed to a new challenge by estate agents. The High Court originally ruled that millions of pounds of residential tenancy “renewal” fees charged by Foxtons to landlords were unfair resulting in expected refunds running to millions of pounds. The new interpretation of the law means that buy-to-let investors may now face delays in their claims for a rebate whilst any appeal is heard.
Please get in touc....
(read more...)Thursday January 14, 2010 at 4:45pm
A recent Supreme Court decision will be of keen interest to developers. It was decided that a sewerage undertaker had no power to refuse a builder the right to connect a private drain to the public sewer at the point most convenient to the developer. Welsh Water had argued that it could refuse the connection on the basis that it would overload the system at that point. This would have meant the developer having to connect to the public sewer at a manhole some 300 metres away. The Court rejected ....
(read more...)Monday January 4, 2010 at 9:29am
The Chancellor’s December 2009 pre-Budget Report announced that the Government is to extend and increase the temporary relief from empty property rates for low value properties. The Government will continue the relief for a further year from April 2010.
Further, for 2010-11, empty commercial properties with rateable values up to £18,000 will be exempt from business rates. This continues the exemption for what the Government says is an estimated 70 per cent of empty properties.
Wit....
(read more...)Friday December 11, 2009 at 4:16pm
This Act of Parliament has now received Royal Assent but the date for it actually coming into effect has yet to be announced. Although this sounds like some obscure piece of law, there will be one significant benefit for property developers.
At present, an option to purchase land is void if it is not exercised within twenty-one years of the date the option is granted. Now twenty-one years may sound a long time but for investors and developers who specialise in the strategi....
(read more...)Tuesday December 1, 2009 at 9:32am
The rate of VAT returns to 17.5% on January 1, 2010. What VAT treatment applies to quarterly rental payments due on December 25? Where contracts are exchanged in 2009 to complete in 2010, and VAT becomes payable on the contract deposit, what VAT treatment applies at exchange and at completion?
December 25 rent payments The tax point for standard-rated leases is the date the landlord issues a VAT invoice or receives payment of the rent, whichever happens first. Hence, on Decemb....
(read more...)Wednesday November 18, 2009 at 11:28am
According to Land Securities in a report by Bloomberg today. The company has announced that it has made offers to buy £500M of assets.
Investment Property Databank had now recorded three straight months of price rises for UK Commercial Real Estate although vacancy rates have continued to rise to a 4-year high.
With commercial property values still 42% below their peak, now may be the time for cash-rich investors to step back in.
For further details of our servi....
(read more...)Friday October 2, 2009 at 11:58am
Following a change to planning rules which took effect on 30 September, developers can now extend their existing planning permissions to give them more time to weather the economic downturn.
Developers with planning permissions granted up until 30 September 2009 where the time limit for implementation has yet to expire may apply to extend their permissions. The move has been made to boost the industry and to save costs for developers badly hit by the recession. Many developers have put pr....
(read more...)Friday September 4, 2009 at 12:09pm
Landlords of commercial premises often try to prevent occupiers enjoying the protection of the Landlord & Tenant Act by giving them a licence rather than a lease. Unfortunately, they very often get it wrong.
First things first. Calling a document a licence doesn't make it a licence. It is well-established law that if the nature of the arangement between the owner of premises and the occupier creates a lease then just calling it a 'licence' does not change the legal na....
(read more...)Wednesday June 24, 2009 at 10:02am
Any developer considering adopting the Code can now read through a number of case studies published by the Department of Communities and Local Government. These illustrate some of the problems encountered by developers building Code Homes for the first time so may be a useful resource.
You can find the case studies here.
Successful property development is all about avoiding the traps.
Steven PettyCommercial Property Lawyer
....
(read more...)Tuesday May 19, 2009 at 7:32pm
A right of way is normally enjoyed along a specific route over someone's land. Sometimes the route of a right of way can be inconvenient to the owner of the land over which the right is enjoyed (particularly if the landowner wishes to develop the land) and a recent case has examined whether the landowner has a right to re-route a right of way.
The case has confirmed that a landowner has no right to re-route a right of way (unless the terms of the right of way expr....
(read more...)Monday May 18, 2009 at 12:46pm
A couple of recent reports have suggested now might be the time to consider stepping back into the UK commercial property market.
Last week, Cushman Wakefield indicated in its Business Briefing that prime yields for UK property have stabilised in the last two months with 21 of its 24 key yield outlook indicators flat-lining between March and April.
Today, Schroders called UK property "a screaming buy" particularly for overseas investors due, in part, to Sterling's weakness.
With com....
(read more...)Thursday May 14, 2009 at 7:08pm
When can we expect a recovery? This must surely be the question all SMEs are asking themselves. Most have adjusted to the recession as best they can, costs have been cut, cash flow managed more effectively and surplus labour made redundant. It has been painful, profits have been slashed, if they exist at all, but we hear of more and more businesses saying that they think they will survive the recession. But just how much longer until the belts can be loosened? There has been some talk in recent ....
(read more...)Wednesday April 22, 2009 at 3:35pm
If you were hoping for assistance for the hard-pressed property sector from the budget then today's announcements will have left you feeling very disappointed.
The schemes such as they are consist of:
a three month extension of the SDLT holiday for houses sold for £175,000 and under
extra money for existing Government schemes to support first time buyers
a scheme to kick-start stalled housing projects
With the price of an average house still falling every month ....
(read more...)Monday March 23, 2009 at 6:16pm
This was publicised in the Telegraph today and is another piece of bad news for businesses struggling with their cashflow.
The rateable value of some properties rose or fell in line with changes in rental values after the last revaluation on 1 April 2005 and 'transitional arrangements' were in place to phase in the increase or decrease in the rate bill. The next revaluation will come into effect on 1 April 2010. The current transition scheme operates over a four year period from 1 April 2005. T....
(read more...)Tuesday March 10, 2009 at 9:28am
Landlords and tenants frequently agree terms verbally rather than having a formal written lease. Three recent cases have examined whether or not these oral agreements are enforceable.
These cases have confirmed that to be enforceable, an oral agreement must be:
for a term of no more than 3 years
at the best rent reasonably obtainable for the premises
in possession (ie the term of the lease must begin immediately rather than at some date in the future)
If you have entered ....
(read more...)Wednesday March 4, 2009 at 2:00pm
Talking to clients I am conscious that the cost of business premises is concerning many business owners at the moment. In the retail sector some businesses just can't meet their rents - hence the latest figures suggesting that 90,000 shops stood vacant across the UK in February.
Premises are one of a business’ biggest overheads and so it pays to continually review what steps you can take to reduce your premises costs.
I've just added an article with 10 tips for saving money o....
(read more...)Monday March 2, 2009 at 6:47pm
A "virtual assignment" is an arrangement under which all the economic benefits and burdens of a lease are transferred to a third party, but without any actual assignment of the leasehold interest.
The perceived benefit of a virtual assignment has historically been that it effectively enables the transfer of a lease to take place without having to wait for landlord's consent.
This device is normally used in large portfolio transactions, where there is not time to obtain all the landl....
(read more...)Tuesday February 17, 2009 at 8:00am
Business Premises Renovation Allowance (BPRA) is designed to encourage the conversion and renovation of empty business properties in certain development areas by granting 100% tax relief for capital expenditure incurred in bringing them back into business use.
The relief was introduced in the Finance Act 2005, but due to lengthy negotiations with the EU over state aid, it only came into effect on 11 April 2007. The relief is temporary and is intended to expire 5 years after its introduction, on....
(read more...)Monday February 16, 2009 at 2:17pm
At a time when there are an ever increasing number of empty business premises, landlords need to adopt strategies for making their premises more attractive to prospective tenants. Adopting the Code for Leasing Business Premises may be one such strategy.
The Code was set up as a voluntary framework to promote fairness between landlords and tenants of business premises. It sets out 10 key areas where landlords must adopt good practice including repairs, service charges and rent review....
(read more...)Wednesday February 4, 2009 at 10:38am
I have posted before about the drive by tenants to alter the rent payment frequency under their leases from quarterly to monthly in an attempt to improve cashflow.
The British Retail Consortium has now published on its website a draft rent variation letter for use in circumstances where a landlord agrees to allow the tenant to pay rent on a monthly basis.
Landlords should beware however as this is a letter drafted on behalf of a tenants' representative body and does not advise landlords that a....
(read more...)Tuesday February 3, 2009 at 10:08am
Following on from my article in January's edition of the Cousins Business Law ezine, a recent case has demonstrated the approach of the Court to resolving difficult boundary disputes.
In this case the Court of Appeal summarised the difficulty facing it with these words:
“the dispute has all too many features that are usual and familiar: on the one hand the need for the parties to have their disputes resolved by the court, rather than by any process of sensible discussion, accommodation o....
(read more...)Monday February 2, 2009 at 9:49am
A recent case has confirmed that a landlord not only owes a duty to a tenant to consider its application for licence to sublet properly but also to deal with it promptly.
In this case, a landlord took six weeks to grant its consent to a tenant's application to sublet. Although consent was ultimately given, the proposed subtenant had by that time withdrawn from the proposed sublease and the Court decided that the proposed subtenant's decision to withdraw was caused by the delay in&n....
(read more...)Tuesday January 6, 2009 at 10:13am
To survive in 2009 landlords and tenants need to make sure they are better prepared than their competitors. Here are a few New Year's resolutions that may help:
For Landlords:
1. Revalue your property portfolio
2. Take advantage of the Cousins Business Law free business lease review for landlords
3. Avoid business rates on empty property but also bear in mind the changes to empty property relief for financial year 2009/10
For Tenants:
1. It's time to renegotiate your ....
(read more...)Tuesday December 16, 2008 at 9:42am
Perhaps surprisingly, the Landlord and Tenant Act 1730 and the Distress for Rent Act 1737 are still in force. If you are a landlord you may find these two pieces of legislation could bring some welcome Christmas cheer. For tenants, though, it will definitely be a case of 'Bah, humbug!
At the end of a lease the landlord can claim either double rent or double value for any period the tenant remains in occupation beyond the end of the term of the lease.
The Landlord and....
(read more...)Thursday December 11, 2008 at 6:00am
By January 2009 or January 2011, dependent on the size, all air conditioning units will be required to have an energy efficiency inspection. These inspections may only be completed by an accredited Air Conditioning System Energy Assessor (ACSEA).
Air conditioning systems greater than 250kW, and which were put into service before 1 January 2008, will need to be inspected by an energy assessor by 4 January 2009. Systems with an output of more than 12 kW will need to be inspected before 4 January ....
(read more...)Monday December 8, 2008 at 9:00am
If your tenant is in arrears and you are worried that they may be insolvent then you need to know what the implications might be for you as they are less straightforward than you might think.
Unfortunately, an insolvent tenant can produce a minefield of problems for a landlord and there is no real substitute for taking advice from your lawyer on your specific circumstances.
However, here are a few tips for landlords of commercial premises:
Individuals
A landlord should bear in mind that in r....
(read more...)Wednesday November 26, 2008 at 3:07pm
Having previously advised that now is the time to renogotiate your lease, the GMB union has announced that MFI is attempting to do just that by asking its landlords to agree a rent free period to stave off administration. It will be interesting to see whether MFI is successful but it is another example of a major retailer seeking to renegotiate terms with its landlord.
If you are considering renegotiating your lease then now is the time to take advantage of Cousins Business Law's free lea....
(read more...)Friday November 21, 2008 at 12:58pm
If you currently own a development site with planning permission that is about to expire then you could be faced with a number of problems.
The first problem is that if the planning permission expires without the development being commenced then you will be the proud owner of a site you cannot develop without re-applying for planning consent. If planning policy has changed in the meantime you may find your application is refused.
The solution to this problem is to ensure you have carried....
(read more...)Monday November 10, 2008 at 10:23am
If you are a property developer and you've never seen your lawyer in his wellies then it might be time to consider changing your lawyer.
Visiting a development site is the only way a lawyer can identify certain potential legal problems. If you've just bought a site that your lawyer hasn't visited then ask them the following questions: 1. How do they know there are no discrepancies between the title deeds and the physical boundaries on site? 2. How do they know whether there is any evidence on s....
(read more...)Friday November 7, 2008 at 10:06am
A lot of articles have been written recently about the Revenue’s view on the VAT treatment of a house-builder who, in the current climate, alters the nature of its business from the sale of houses (which are zero-rated supplies of new dwellings), to the short-term letting of houses (which are exempt supplies). Although a change from taxable to partially exempt supplies can affect a housebuilder’s VAT recovery position, the Revenue allows the application of a de minimis rule to a....
(read more...)Monday November 3, 2008 at 1:02pm
The House of Lords has just overturned the case I referred to in my blog last week meaning that a landlord only needs to serve the guarantor with notice within six months of a rent review being decided. The same rule would also apply to a service charge where the final figure for payment is only decided after the service charge payment date.
It's good to see that the Law Lords had regard to "some remarkably silly consequences" of the decisions of the lower courts.
Steven Petty,....
(read more...)Friday October 31, 2008 at 8:23am
Most modern leases impose an obligation on a tenant to stand as guarantor if the lease is sold on to a new tenant.
There are strict rules on the steps a landlord must take if it wishes to rely on that guarantee, however. A landlord cannot simply allow arrears of rent or other sums payable under the lease to mount up and then send the bill to the guarantor.
The landlord is required by law within a period of six months beginning on the date a sum of money becomes due....
(read more...)Tuesday October 28, 2008 at 9:17am
The Bank of England published the latest edition of its Financial Stability Report today.
Apart from making very sober reading generally, it touched on a problem that may be facing commercial landlords.
Commercial property prices have fallen by 24% since their peak and rental growth has also ground to a halt. In addition, the downturn in the economy increases the liklihood of commercial tenants defaulting on their rental payments.
These facts are of real concern to commercial lan....
(read more...)Tuesday October 14, 2008 at 9:29am
The vast majority of tenants don't even consider trying to renegotiate their lease once it has been signed. Those who do approach their landlord to change the terms of their lease, however, are frequently pleasantly surprised.
So why would you want to renegotiate your lease?
Financial difficulties - probably the most common reason, particularly in the current economic environment. Landlord's will often consider temporary reductions in rent to help a tenant trade through a slowd....
(read more...)Friday September 26, 2008 at 3:47pm
Cousins Business Law commercial property solicitor Steve Petty is offering a free 20-minute telephone business lease review for both landlords and tenants.
In these difficult times a review of your lease arrangements could save you significant sums and be the difference between surviving and thriving. Not sure whether you need to review? Take a look at Steve’s six crucial questions
Lease review for LandlordsIf you are a landlord and can answer ‘yes’ to any of these questions....
(read more...)Thursday September 25, 2008 at 9:19am
The OFT has today published its market study into the homebuilding sector which says that while the sector is broadly competitive, many homebuyers experience faults or delays. As a result, the industry has agreed to develop its own code of conduct and redress scheme for consumers.
The OFT found that homebuyers can experience a number of problems, which include:
delays in moving in
faults in new homes, and
issues around the sales process including reservation fees, the clari....
(read more...)Wednesday September 3, 2008 at 4:50pm
Distress is a legal term which refers to a landlord's power to recover a debt from its tenant by entering premises; seizing the tenant's goods to the value of the debt; then selling them to satisfy it. It has always been an effective remedy for landlords as the presence of bailiffs on the premises can be both an intimidating and embarrassing experience for a tenant . Tenants will be able to relax therefore when the law of distress is abolished later this year. In its place will be a new regime c....
(read more...)Wednesday August 27, 2008 at 3:21pm
Many tenants sign up to leases which include a service charge but most don't appreciate the extent to which they are effectively signing a blank cheque. A typical service charge provision will entitle the landlord or a separate management company to provide a range of services to tenants in a building. The landlord then recharges the cost of providing those services to the tenants. Individual tenants will be obliged to either contribute a fixed percentage of those costs or a 'fair' proportion (o....
(read more...)Friday August 22, 2008 at 4:14pm
Since 1 April this year owners of industrial and warehouse premises must pay full business rates on premises once they have been empty for six months. For owners of offices and retail property the liability comes in after the premises have been empty for only three months. Clearly this could be an enormous expense for a commercial landlord with a number of empty properties. Anecdotally, I have heard in my area that landlords are slashing rents on empty premises just to get them occupied to avoid....
(read more...)Wednesday August 20, 2008 at 4:17pm
The law is littered with terms that tend to only mean something to lawyers and other professionals. Dilapidations is a term every landlord and tenant of commercial premises needs to understand. All leases have obligations on a tenant to keep a property in a certain state of repair and decoration and dilapidations refers to a state of repair and decorative order that falls below the level required by the lease. The first time a tenant tends to hear the term dilapidations is when it receives a sch....
(read more...)Monday August 18, 2008 at 4:19pm
It's been pretty commonplace over the last ten years for people to sell off part of their back garden to a property developer. With the construction of new homes effectively mothballed at the moment, you might be forgiven for thinking that you've missed the boat if you are keen to sell off some surplus garden land. The good news is that developers specialising in certain types of property are still in the market for land and one such area is bungalows. This market is holding up rather better tha....
(read more...)Wednesday August 13, 2008 at 4:24pm
Many legal documents contain provisions that require one party to serve notice on the other. This can sometimes trigger the next stage of a transaction or possibly the termination of the contract. Whatever the reason, serving notices is an absolute minefield with a huge body of caselaw establishing how and when notices must be served. In addition to the weight of caselaw, the agreements themselves often have detailed provisions setting out what constitutes valid service of a notice. This can som....
(read more...)Monday August 11, 2008 at 4:27pm
No, it's not a lease printed on green paper or a lease of that bit of land in the middle of a village where we are all supposed to be able to graze our sheep. A green lease is one that includes obligations on the landlord and tenant to achieve targets for energy consumption. Perhaps surprisingly, green leases are thought to have originated in Australia. The Australian Government Solicitor prepared a template lease for use in lease transactions involving government agencies or bodies. The key ele....
(read more...)Thursday August 7, 2008 at 4:30pm
We all know that land transactions are potentially liable to Stamp Duty Land Tax (SDLT) but did you know that, in certain circumstances, SDLT can be charged on some or all of the goodwill of a business? This is what the HMRC manual says on the subject of SDLT: Stamp duty land tax is a charge on transactions in 'land'. Thus the subject-matter of the charge includes anything forming part of the land as a matter of law, such as buildings and structures forming part of the land, and fixtures. This m....
(read more...)Friday July 25, 2008 at 4:40pm
The rolling break is a tool that is seldom used but it can be beneficial to both landlords and tenants. A standard break clause gives you one shot at ending your lease. You have to serve notice in the right way and at the right time and sometimes have to satisfy other conditions for the break to be effective. If you fail to exercise the break correctly you may be stuck in a lease you don't want for years to come. The rolling break overcomes these problems by allowing you to terminate the lease a....
(read more...)Thursday July 24, 2008 at 4:42pm
Does the idea of a long term legally binding commitment frighten you? You might be starting up in business or just need the flexibility to leave premises at short notice. You might be a property owner who doesn't want a tenant to acquire rights of occupation. For both parties, the cost of employing lawyers to negotiate a fifty page document can also be prohibitive. Here are a few alternatives: Tenancy at Will This is the 'one night stand' of property relationships. A tenancy at will gives a tena....
(read more...)Wednesday July 23, 2008 at 4:44pm
When it's a cat. Confused? So were the people who thought they were buying a piglet only to find that when they opened the bag (or poke) that there was a cat inside. This gave rise to the well known phrase 'buy a pig in a poke' meaning to purchase something without examining it first. It's also thought to be the origin of the phrase 'to let the cat out of the bag' meaning to reveal the secret. Purchasing a business can be like buying a pig in a poke. Very often all you know about the business is....
(read more...)Monday July 21, 2008 at 4:49pm
Well, you wouldn't quite describe 16 of the country's biggest retailers as worms, but they are turning on their landlords in a bid to change the way they pay their rent. They are asking their landlords to allow them to pay rent monthly rather than quarterly. It's another sign that the hard-pressed retail sector is doing everything it can to improve its cashflow as high street spending continues to fall. Although their landlords will have no obligation to agree as the payment obligations will be ....
(read more...)Friday July 4, 2008 at 4:55pm
If you have ever negotiated a lease of commercial premises you will probably have come across the term 'upwards only rent review'. For those of you who haven't, it is quite simply a provision in a lease which allows the rent to be reassessed (typically every five years but it can be reviewed at any time in principle) by reference to the rent a landlord would be able to charge a new tenant at the time of the review but crucially the review cannot cause the rent to fall. During the last ten years,....
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