How do I make sure my commercial rental property is properly maintained?

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Regular Inspections: Conduct routine inspections of the property to identify any maintenance issues or potential problems. Check for leaks, cracks, signs of wear and tear, malfunctioning equipment, and safety hazards. Address these issues promptly to prevent further damage.

Without proper maintenance any commercial property will gradually fall into disrepair. It will cost far more to repair a neglected building – a stitch in time. Without a proper maintenance plan and regular attention the building will decay and it will cost far more in the long run.

Business tenancies tend to be long: 5, 10 or 15 plus years, so it’s important that commercial landlords have some control over repairs and maintenance.

Good commercial tenants will want to keep their property in good repair because a run-down building will have an adverse effect on their business, especially when their customers are visiting the building.

But being tenants and not owners of the building there is often a reluctance to spend money on it: that’s why the commercial landlord must have a strategy for making sure necessary repairs are carried out.

The commercial lease

The key to this process is the lease, and the maintenance clauses it contains. Unless the lease is a short one, under six months, the ideal for a commercial landlord is to let the building on a full repairing and insuring (FRI) lease.

This is the traditional institutional lease where the owner has a clear unencumbered return on the investment – the tenant pays for everything, including insurance, safety checks, repairs and reinstatement at the end of the lease term – see dilapidations.

The lease should include a Schedule of Condition which records in detail the condition of the property at the commencement of the lease term, usually drawn up by an independent party – a chartered surveyor. The schedule, whether provided by the landlord or the tenant, is then agreed at the outset by both parties. It’s a reference point for reinstatement when it comes to drawing up a Schedule of Dilapidations.

Self-contained buildings

Where the tenancy is for a self-contained building – that is where the tenant occupies the whole building – maintenance responsibilities are somewhat simplified. Usually, the landlord supplies the building in good tenantable repair, as per the Schedule of Condition, meeting all the applicable regulations such as planning use, electrical, gas and fire safety.

From then the responsibility – if the lease is properly drawn up – lies with the tenant to maintain the building and comply with all the necessary regulations, and return the building in a well-maintained tenantable state. If not, the landlord has recourse to the dilapidation’s procedure.

Multi-occupied buildings

A multi-occupied building presents more of a challenge and more work for the landlord. As no one tenant can take responsibility for the whole building the landlord or his managing agent must coordinate and arrange for the necessary repairs using a maintenance schedule. For example, annual gas checks, 5 yearly electrical system checks, annual fire alarm and fire equipment checks and servicing, painting every 7 years etc.

Generally, the tenant will be responsible for their own internal repairs and decorating, workplace safety etc, while the landlord will be responsible for the external structure – roof, walls, windows and doors – and the common areas.

The Responsible Person

Fire safety is the big issue here. The law places responsibility for fire safety in the building as well as the safety of occupants, workers and visitors in the hands of “The Responsible Person”. In practice, in this type of multi-occupied building, this responsibility is usually shared between landlord and tenant along the lines outlined above – the tenant (employer) in relation to a workplace and internals, and the landlord / agent for externals, safety checks and common areas.

Either the person who has control of the premises (managing agent) or the owner along with the tenant will be responsible where the premises is not a workplace, such as an unmanned storage warehouse.

In addition to the gas safety and electrical safety checks, the Regulatory Reform (Fire Safety) Order 2005 imposes various duties on the “responsible person” with regards to fire safety in commercial properties.

Duties under this Order include, but are not limited to, arranging general fire precautions to ensure that certain people are safe in the event of a fire, carrying out a fire risk assessment and keeping this under review.

It’s a good idea to have an initial risk assessment carried out by a fire consultant, a specialist who will draw up a detailed scheme. This can either be repeated every 12 months by the specialist, or simply reviewed by the landlord or agent.

Regular inspections should be carried out and documented to ensure that in the whole premises, fire alarms are served and tested weekly, all fire safety equipment is easily accessible and serviced annually, and that fire doors, emergency escape routes and exits are properly maintained and kept in working order.

A “responsible person” found guilty of non-compliance with the Order will be liable to a fine and, in the most serious cases it could mean imprisonment if proceedings are brought in the Crown Court.

General Commercial Property Maintenance

Modern buildings have systems which need regular maintenance. HVAC Systems, heating, ventilation, and air conditioning (HVAC) systems are all essential for comfortable occupation and efficiency. Schedule regular maintenance for HVAC units, including filter replacement, cleaning ducts, and inspecting for any issues. This will ensure optimal energy efficiency and reduce utility costs.

Service charges and disputes

When a landlord sticks to a regular maintenance plan to keep the property in a good state of repair as per the schedule of condition, and without undertaking unnecessary work, most tenants will appreciate this as it enhances their business.

However, experience shows that some tenants, especially if their business is struggling, will resent having to pay out money for repairs, maintenance and groundworks on top of their annual building insurance charges. Usually, the landlord will finance the repairs and maintenance and apportion the costs between the tenants in the building according to a formula set-out on the lease – usually based on occupied floor area.

When disputes arise, often because the tenant is arguing about the necessity of the work or that there is excessive cost of repairs, it may be necessary to follow up with court action. Landlords cannot afford to allow one tenant to avoid paying service charges while others are paying in full.

In some cases it may be possible to resolve disputes without resorting to the courts through a process of independent mediation, but if a stalemate is reached it may be necessary for the parties to agree to an independent assessment of the work by a qualified third party, i.e., a chartered surveyor.

Schedule inspections, safety checks and maintenance

Set a schedule for weekly, monthly, and annual tasks using a checklist, and make sure that these are carried out with any work identified as needed to be carried out without delay. don’t put off minor repairs or safety issues as they can turn into major issues over time.

Don’t forget externals such as drives, paths and outbuildings which can represent safety issues for which the responsible person is responsible for. Roads, potholes, pavements and pavers out of place can all cause safety hazards for vehicles and people coming to the property.

Prevent Pest Infestations

There’s another issue that regular inspections should identify and that’s pest infestations that can easily get out of control. Just like neglected maintenance issues, the longer this goes on, the worse it can get. With a serious outbreak you may need a pest control specialist to deal with the problem.

Conclusions

There’s quite a bit of work involved in keeping on top of tenancies in a multi-occupied building, making sure the building is kept in tip top condition and ensuring that you are meeting the critical safety regulations.

There’s a lot to schedule in, so you might consider using a professional managing agent to take on some of these responsibilities. This will cost money but it has the advantage of having an independent person to decide what’s required, and that may be more acceptable to your tenants.

View Full Article: How do I make sure my commercial rental property is properly maintained?

PICS: Dawn raid in London reveals ‘shocking and horrifying’ illegal HMO

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Eleven tenants have been found crammed in a squalid and illegal HMO during a dawn raid on a three-bedroom house in Wembley.

Following a tip-off from residents, Brent Council’s housing enforcement team and police entered the semi-detached property in West Hill early one morning where tenants were sleeping in every room except for the kitchen and bathroom.

Officers reported disgusting conditions during their inspection, including a polystyrene ceiling giving way inside the kitchen, no fire safety doors and no fire alarm system. Damp and black mould also covered the walls and ceilings inside the rooms.

Tenants told Brent’s licensing enforcement team that they were paying a combined rent of more than £2,000 to their landlord.

Councillor Promise Knight, cabinet member for housing, homelessness and renters’ security, promised to hold the owner to account.

Slum-like

“It is shocking and horrifying that rogue landlords make a profit from keeping people in dangerous and slum-like conditions like this,” she says. “People in vulnerable circumstances tend not to know what rights they have as renters. Rogue landlords who exploit their tenants’ vulnerability will find themselves facing hefty fines and possibly a criminal conviction.”

Last month, Brent Council agreed to bring in a selective licensing scheme in three wards – Dollis Hill, Harlesden & Kensal Green and Willesden Green – from 1st August following a borough-wide consultation. 

Plans for an alternative expanded scheme covering 21 wards got the thumbs down from 75% of landlords and 46% of residents.

Comments widely viewed the larger scheme as an addition financial burden on the PRS, some describing it as a ‘money grab’, ‘cash grabbing’ and a ‘cash collecting’ scheme, the council’s consultation results revealed.

Read more: Complete guide to letting an HMO.

Pics: Brent Council

View Full Article: PICS: Dawn raid in London reveals ‘shocking and horrifying’ illegal HMO

Property Investors Awards Commercial Property Conversion of the Year

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Taking a farm building that had fallen into disrepair and turning it into a stunning double barn conversion shows that Hunnings Homes has gone above and beyond to win Commercial Property Conversion of the Year at the Property Investors Awards.

View Full Article: Property Investors Awards Commercial Property Conversion of the Year

Borrowing for UK Buy to Let as an expat?

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Hi all, I am in the process of moving abroad. My income from overseas would be considerably larger and I was planning to invest it into Buy to Let in the UK.

The broker I usually speak to practically said it would not be possible as an expat with income abroad to get funding for BTL purchase back in the UK.

View Full Article: Borrowing for UK Buy to Let as an expat?

Regulator exposes neglected safety checks in Birmingham City Council properties

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Birmingham City Council, the largest council housing landlord in the country, has come under fire for failing to meet regulatory standards and adequately maintain its homes.

The Regulator of Social Housing has revealed that the council, responsible for managing 60,000 properties

View Full Article: Regulator exposes neglected safety checks in Birmingham City Council properties

Leading pets and PRS figures warn ‘much work needed’ to make reform bill workable

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A group of leading figures representing animal charities, pet owners and property managers have warned that much work will be needed in the coming months to make the Renters (Reform) Bill acceptable to landlords and tenants.

The group, which has largely welcomed the bill, tells LandlordZONE that it must balance the needs of both sides and establish the circumstances under which landlords can refuse a pet under its new ‘statutory presumption in favour of acceptance’.

But as the legislation passes through parliament, guidance will have to be worked out because, as the bill stands, other than leasehold or freehold restrictions on animals, landlords will have to give a ‘valid reason’ why they wish to refuse a pet.

This could include their own allergies to pet hair, for example, or a pet not being suitable for a property.

“It’s about providing landlords with a set of tools to help them make a fair and reasonable decision about why their property is or is not suitable for a pet,” says Scott Fryer of Battersea Dogs & Cats Home.

Heidi Shackell (pictured), CEO of The Lettings Hub, says the bill is also vague about how referencing and insurance will work and, for example, “if a pet fails referencing and the tenant or landlord cannot secure an insurance policy, will this be good enough reason to refuse a pet?”.

She also says the legislation may prove hard to police because if a landlord or agent has several tenants chasing a home and one of them has a pet (and is not picked), how could it be proved that they’ve been ‘refused’ the tenancy?

Nevertheless, landlords will have to be careful when advertiseing their rental properties, as will letting agents.

“We need to get portals like Rightmove engaged with the issue of pets because it’s no good having ‘yes’ or ‘no’ to them within listings – once the bill gains Royal Assent, ‘no’ (due to property decisions) or ‘pets considered’, will become the accepted options” suggets Jen Berezai (pictured), founder of Advocats.

It is claimed that Ministers are also looking at ways to encourage property leaseholders and freeholders to be more pet friendly by making it easier and cheaper to alter a building’s terms and conditions to allow them.

Pet issues

“Our research shows that a significant proportion of the ‘pet issues’ landlords have particularly in cities are due to leaseholder or superior landlord rules on pet ownership within buildings, with approximately 37% of all rental dwelling being leasehold properties,” says Fryer.

Did you know? Rightmove recently revealed that the percentage of all its listings advertised as ‘pet friendly’ has dropped from 7% to 4%.

Elizabeth Ormerod of the Society for Companion Animal Studies, added: “Pets are good for human wellbeing, and we know from our research that people who are brought up alongside them see many health and psychological benefits from animal companionship.”

A final area of discussion was whether the new measures within the bill, and particularly the six weeks given to landlords and agents to refuse/agree if asked to accept a pet, will apply only to existing tenancies or new ones.

Several people within the group said they understand it will initially only be for existing tenancies, not new ones, although this has yet to be confirmed officially. If applied to new tenancies, the group said, then the six-week waiting period would be ‘unworkable’.

Who are the experts?

Elizabeth Ormerod from the Society for Companion Animal Studies; Scott Fryer from Battersea Dogs and Cats Home; Dr Sandra Mcune from the University of Lincoln; Debbie Rook from the University of Northumbria Law School; Gilly Ferreira from the Scottish Society for the Prevention of Cruelty to Animals, The Lettings Hub CEO Heidi Shackell and Jen Berezai, founder of Advocats.

View Full Article: Leading pets and PRS figures warn ‘much work needed’ to make reform bill workable

Pets and property experts warn ‘work needed’ to make reform bill workable

admin    Uncategorized     agents

A group of leading figures representing animal charities, pet owners and property managers have warned that much work will be needed in the coming months to make the Renters (Reform) Bill acceptable to landlords and tenants.

The group, which has largely welcomed the bill, tells LandlordZONE that it must balance the needs of both sides and establish the circumstances under which landlords can refuse a pet under its new ‘statutory presumption in favour of acceptance’.

But as the legislation passes through parliament, guidance will have to be worked out because, as the bill stands, other than leasehold or freehold restrictions on animals, landlords will have to give a ‘valid reason’ why they wish to refuse a pet.

This could include their own allergies to pet hair, for example, or a pet not being suitable for a property.

“It’s about providing landlords with a set of tools to help them make a fair and reasonable decision about why their property is or is not suitable for a pet,” says Scott Fryer of Battersea Dogs & Cats Home.

Heidi Shackell (pictured), CEO of The Lettings Hub, says the bill is also vague about how referencing and insurance will work and, for example, “if a pet fails referencing and the tenant or landlord cannot secure an insurance policy, will this be good enough reason to refuse a pet?”.

She also says the legislation may prove hard to police because if a landlord or agent has several tenants chasing a home and one of them has a pet (and is not picked), how could it be proved that they’ve been ‘refused’ the tenancy?

Nevertheless, landlords will have to be careful when advertiseing their rental properties, as will letting agents.

“We need to get portals like Rightmove engaged with the issue of pets because it’s no good having ‘yes’ or ‘no’ to them within listings – once the bill gains Royal Assent, ‘no’ (due to property decisions) or ‘pets considered’, will become the accepted options” suggets Jen Berezai (pictured), founder of Advocats.

It is claimed that Ministers are also looking at ways to encourage property leaseholders and freeholders to be more pet friendly by making it easier and cheaper to alter a building’s terms and conditions to allow them.

Pet issues

“Our research shows that a significant proportion of the ‘pet issues’ landlords have particularly in cities are due to leaseholder or superior landlord rules on pet ownership within buildings, with approximately 37% of all rental dwelling being leasehold properties,” says Fryer.

Did you know? Rightmove recently revealed that the percentage of all its listings advertised as ‘pet friendly’ has dropped from 7% to 4%.

Elizabeth Ormerod of the Society for Companion Animal Studies, added: “Pets are good for human wellbeing, and we know from our research that people who are brought up alongside them see many health and psychological benefits from animal companionship.”

A final area of discussion was whether the new measures within the bill, and particularly the six weeks given to landlords and agents to refuse/agree if asked to accept a pet, will apply only to existing tenancies or new ones.

Several people within the group said they understand it will initially only be for existing tenancies, not new ones, although this has yet to be confirmed officially. If applied to new tenancies, the group said, then the six-week waiting period would be ‘unworkable’.

Who are the experts?

Elizabeth Ormerod from the Society for Companion Animal Studies; Scott Fryer from Battersea Dogs and Cats Home; Dr Sandra Mcune from the University of Lincoln; Debbie Rook from the University of Northumbria Law School; The Lettings Hub CEO Heidi Shackell and Jen Berezai, founder of Advocats.

View Full Article: Pets and property experts warn ‘work needed’ to make reform bill workable

COMMENT: Binning ‘no fault’ evictions will only help ‘nuisance tenants’ – claim

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A leading lawyer warns that by abolishing section 21 the government will be helping nuisance tenants at the expense of the weak and vulnerable.

Under the Renters (Reform) Bill, landlords will be able to evict for behaviours ‘capable of causing’ a nuisance or annoyance as opposed to behaviours ‘likely to cause’ a nuisance or annoyance.

Although the government says this means that a wider range of tenant behaviours can be considered in court, Ian Narbeth, solicitor at DMH Stallard, argues that this misses the point.

“Lawyers may argue about the subtle change in wording, but most cases don’t get to court and by the time they do, the behaviour is serious and anti-social – not just capable of being so,” he explains. “Until now, landlords served section 21 notices on anti-social tenants and did not need to go to court.”

With the massive backlog in cases, it can be many months before cases are heard, witnesses may fear harassment by an aggressive neighbour or their family and friends, while landlords can give no guarantee of succeeding and witnesses will fear reprisals, especially if the eviction fails, adds Narbeth.

Troublemakers

“Instead of landlords dealing with the problem simply and confidentially, abolishing section 21 means troublemakers must have their day in court and many victims will choose to suffer in silence or else leave their homes rather than give evidence.

“The government will be helping nuisance tenants at the expense of the weak and vulnerable, which is the opposite of what it is claiming.”

Landlord Action’s Paul Shamplina has already warned that there could be more section 8 rent arrears cases, prompting a social housing crisis with many tenants struggling to be rehoused as a result of scrapping section 21, while the TDS charitable foundation says it might not provide the hoped-for feelings of security or encourage tenants to complain when rental homes are in short supply.

View Full Article: COMMENT: Binning ‘no fault’ evictions will only help ‘nuisance tenants’ – claim

Landlords selling up boosts supply of affordable homes

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Faced with rising mortgage rates and mounting costs, a wave of landlords is opting to sell their properties, leading to a surge in the availability of affordable homes, Zoopla reveals.

The housing platform says that 11% of homes currently listed for sale were previously rented out

View Full Article: Landlords selling up boosts supply of affordable homes

Binning ‘no fault’ evictions will not make tenants more secure, Government warned

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Removing Section 21 might not provide the hoped-for feelings of security and encourage tenants to complain when rental homes are in short supply, warns a housing charity.

The TDS charitable foundation’s poll of 2,000 private renters found that a lack of affordable accommodation influenced tenants’ willingness to escalate complaints and request energy efficiency upgrades. 

Its report – Living in the PRS in 2023 – explains: “There is a risk that even with the removal of Section 21, tenants will be reluctant to raise complaints and the new landlord ombudsman will receive a low number of complaints.

“We therefore invite the government to think more expansively about the range of factors that influence feelings of security and avoid assuming that tenancy law is the main or only driver of tenant behaviour.”

Most tenancies are ended by the tenant rather than the landlord, according to the charity, with only 12% of tenants who moved in the last 12 months doing so because the landlord asked them to leave.

changing needs

Moves in the rental sector are largely related to changing needs or preferences of occupants, such as wanting a larger or smaller home, or job-related reasons.

Read more: Will Section 8 be enough when Section 21 evictions go?

The findings reveal that while many tenants believe that the energy efficiency of their property could be improved, they are reluctant to do so in case the landlord increases the rent (38%) or asks them to leave (25%). However, 39% had requested improvements and of these, 74% were either happy or somewhat happy with the response.

Some of those moving in the last six months encountered problems that the Renters (Reform) Bill aims to address, such as reporting that the landlord/letting agent was unwilling to let to them due to their race, gender, or other personal characteristics (9%), or didn’t want to let to tenants with children (12%) or to tenants on benefits (5%).

Read the report in full.

View Full Article: Binning ‘no fault’ evictions will not make tenants more secure, Government warned