A planned maintenance program for managing your premises can help minimise damage and the costs of repairs for your business premises. If you lease commercial premises, it’s vital that you understand what your responsibilities are and what you can and can’t do.
Tenant’s responsibilities for maintenance
Any commercial lease should set out how responsibilities for maintenance and repairs are shared between the tenant and the landlord. A typical lease may require you to keep the premises in good condition – even if they are not when you take them over. You’ll want a chartered surveyor to provide a property survey, particularly if you could be required to pay for structural repairs. A schedule of condition can provide useful evidence for negotiations.
If you are leasing an entire building, it’s likely that you will have a fully repairing and insuring lease, giving you responsibility for maintaining the building and reimbursing the landlord for the costs of building insurance. If you lease part of a building, such as a shop unit, you might be responsible for internal repairs in your unit while the landlord looks after the structure. You may be required to contribute to the cost of the landlord’s maintenance through a service charge.
A typical lease requires you to keep the premises in good condition, as well as making sure they are in good condition at the end of the lease term. If you fail to keep up with maintenance, your landlord can serve you with a schedule of dilapidations requiring you to put things right. Failing that, you can be required to meet the landlord’s costs in doing so.
A landlord will almost always look to serve a schedule of dilapidations at the end of a lease. Once the lease has expired, you will no longer be able to carry out any maintenance so will simply face a monetary claim. Taking advice and starting negotiations with the landlord several months before the end of the lease is a better approach. Depending on the landlord’s plans for the premises, you may be able to limit or altogether avoid liability for dilapidations.
Premises security and insurance
As a practical matter, you should ensure that your premises are properly secured to help protect employees, equipment and the premises themselves. As well as physical security measures such as alarm systems and locks, you need effective training of employees and security policies. For example, you might think about policies and procedures for working alone, handling cash and locking up at the end of the day. Your insurance policy may include various security requirements.
As well as getting building and contents insurance, employers’ liability insurance is a legal requirement (if you have employees). You may also want public liability insurance (for harm to the public) and legal expenses insurance. A thorough review of your business risks can help you decide what other insurances you want.
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