Businesses that have decided to lease property rather than buy in the current climate are being advised to check the small print in their contracts.
Commercial property law firm SAS Daniels is warning that a swing away from buying to leasing leaves companies exposed to contract conditions they wouldn't have to cope with if they were buying.
"The worst case we've seen is of a business that took out a very short-term lease, didn't read the small print, but then were hit for the cost of the re-surfacing of the shared car park - a once-every-15-years-matter - and then when they left the premises found they had to virtually completely refurbish the building way above and beyond the condition in which it was when they moved in," said Becky Simpson of SAS Daniels LLP.
"That was a particularly bad case, and a result of not involving commercial property solicitors when they took out the lease, in which case most of the conditions would have been at worst re-negotiated and at best removed completely from the agreement."
The law firm is advising companies watch out in particular for service charges and establish early on who is expected to pay for such matters as gardening, minor maintenance or cyclical works.
It is also warning them to watch out for leases that insist the tenant returns the property back into a far better condition than it was in when they moved in at the end of the tenure.
"A tenant needs to understand their obligations," added
Simpson. "Crucially, they should consult a solicitor who will in most cases
advise them to bring in a surveyor to report upon and record the condition of
the building when the tenant moved in: that is the benchmark condition to which
the property should be returned.
"If not, then they could end up replacing windows that were
rotten when they moved in, even re-wiring or re-plumbing," she added.