In the current economic climate many landlords are looking at solutions for restricting the falling reversionary value of their stock without the need of expenditure on professional fees or remedial works.
Interim Schedules of Dilapidations are a method of assessing the condition and disrepair of a property.
The schedules recommend the remedial works required to aid negotiation with the lessee to undertake the repairs and redecorations to put the premises in either reasonable or good order, depending on the circumstances. The fee for the inspection and report is usually paid by the tenant as part of their lease obligations.
Notwithstanding the above, it is important to understand the fine balance between keeping good relations with a tenant and also maintaining a property in a condition that could potentially maintain optimum capital value, in relative terms.
Day and Bell’s surveyors are currently undertaking a number of interim inspections on behalf of property investors to establish the extent of remedial works needed to enhance the condition and reversionary level of their building stock whilst identifying costs of work that are consistent with the lessee’s financial abilities. This is a highly skilled process involving positive and discreet discussions with each occupier to establish the level of expenditure that could be mutually agreed without significantly undermining the tenant’s operations and their relationship with the landlord.
The cost of such an exercise is based on a time spent / incurred basis and typically ranges from £1.25 - £1.50 per square foot (£13 - £16 per square metre) to prepare a Schedule that may be more favourably received by the tenant than the traditional process of inspecting and serving the document without some form of initial discussion. Please note that all of the above figures are subject to VAT and normal ‘out of pocket’ expenses.
We have successfully encouraged lessees to repair and redecorate leasehold properties after many years of neglect and lack of maintenance thereby enhancing the appearance and condition of the building fabric and reducing the effect of diminution of the reversionary value as a result.
If you would like to know more, please contact either us on the number below to find out how we may be of benefit to you.