Negotiating a New Business Lease on behalf of the Landlord

As the economy is improving there are an increasing number of leases being granted to new businesses entering the marketplace or businesses needing more space. Typically leases in these circumstances will be for shorter periods and the commercial property market following the recession has in any event changed so that leases are granted for shorter periods.

The objective of the Landlord is usually to dispose of the lease of a whole building by way of a full repairing and insuring lease. If the lease is to be of part of the building then the Landlord will dispose of it on an internal repairing basis with the Tenant responsible for contributing towards external and structural repairs through a service charge. Either way the Tenant will meet the full costs of repairing, maintaining and insuring the building.¬† This will maximise the Landlord’s investment in the Building.

There is usually little difficulty for a Tenant about taking on premises and being responsible for the internal non-structural parts as that is readily identifiable and a manageable expense. The real issue is how to draw a balance between the Landlord who wants the tenant to be responsible for all the costs associated with the building and the Tenant who will only be occupying for a shorter period, typically 5 to 10 years.

The Tenant will typically want to negotiate these terms and there are potentially a number of ways these negotiations can progress

Time spent at the outset negotiating the terms of the lease on the part of both the Landlord and the Tenant can help to avoid difficulties and expensive disputes at a later date. It may take a little longer before the deal is done but it could pay dividends later on.

Dibbens Solicitors can provide appropriate advice to both the Landlord and the Tenant and do please contact our property team at our Wimborne office on (01202) 882456.