Case Study - Building Survey or Schedule of Condition
The client was considering taking a fully repairing lease of an industrial building and wished to understand the obligations under the terms of the lease and whether there were any issues that required immediate or long term attention.
The client was given the option of having either a Building Survey of the property which would give a snapshot report on the condition of the property and therefore would be able to identify any works that were immediately necessary or any works that would need to be carried out during the course of the lease term.
The second option was a Schedule of Condition to be prepared which would form part of the lease which would then limit the repairing liability under the terms of the lease to returning the property in no better condition than evidenced by the Schedule of Condition.
The client, in this particular instance, chose to have a Building Survey of the property undertaken.
A detailed inspection of the industrial property was undertaken from ground level (as the main roof of the property had previously been renewed). This survey identified a number of issues which needed immediate attention which were subsequently negotiated between the tenant and the Landlord to be completed prior to the completion of the lease and the tenants taking occupation.
By giving the ingoing tenant a choice of survey formats this enabled the client to identify any immediate costs of putting a property into repair prior to occupation, or by limiting the potential for a claim for dilapidations at the end of the lease. (A Schedule of Condition).
The client was therefore in a position to make decisions on an informed basis as to the potential cost of rectifying the faults that were discovered and was able to negotiate with the Landlord recompense for the property to be put into good condition at the commencement of a fully repairing lease.