Dilapidations is often described as a 'dark art' with landlord claims broadly averaging the final years rent. Claims can vary between £25 and £75 sq ft with settlements heavily dependent on timing, market conditions, lease obligations, intentions of parties and the strategies and expertise of the negotiators
UK Commercial leases normally require tenants to put the property in good repair at the start of the lease term, maintain it in good repair during the term and hand it back at lease end repaired, redecorated and with the tenant’s alterations removed. Where the tenant doesn’t comply with their lease terms landlords are able to enforce their rights by serving:
- Repair Notices - served midterm, they allow the landlord to carry out repair works in the tenant’s default and at the tenant’s cost during the lease term.
- Interim schedules of dilapidations -served midterm, they allow the landlord to claim compensation (or lease forfeiture) via the courts if the tenant hasn’t completed a schedule of works served on the tenant (the law allows the tenant certain specific rights), and;
- Terminal schedule of dilapidations -served at lease end, the schedule lists the works the landlord feels need to be completed after lease end and helps the landlord to claim their costs back via the courts if the tenant decides not to attempt them before lease end.
UK based dilapidations claims are governed by case law and statute and have been fought over for hundreds of years. Almost every word or phrase in a lease document has been defined in a legal case at some point or another.
When the additional heads of claim such as loss of rent, fees, VAT are added to the final version of the landlord’s terminal claim that often more than double the overall claim.
Using our experience and detailed understanding of the process we can often pre-guess our opponent’s motives, aims and strategies to get ahead of them. Typical strategies include:
Acting for landlords (or occupiers with sub-tenants) we would:
- Analyse the lease documentation, inspect the property and jointly develop a strategy with the client that would include a review of service charge obligations and recovery
- Identify, document and estimate the cost the tenant’s repair, redecoration and reinstatement liabilities and prepare a schedule of dilapidations (or repair notice) for service on the tenant
- Create a PPM for the site and specify, competitively tender and administer service charge recoverable works.
- Use the schedules or repairs notices in subsequent negotiations with the tenant, with the aim of having the tenant carry out the works or properly compensate the landlord if the works are to be carried out in their default after lease end
- If a negotiated settlement is unachievable by lease end, organise competitive tenders, administer the dilapidations works through to completion and assist the landlord in recovering their costs through legal action
- The majority of our negotiations are concluded before lease end with an average 20% conceded reduction in the initial claim
Acting for tenants we will:
- Analyse the lease documentation, inspect the property and jointly develop a strategy with the client
- Identify, document and estimate the cost the tenant’s repair, redecoration and reinstatement liabilities
- Use our assessment of the tenant’s actual liabilities in subsequent negotiations with the landlord’s surveyor
- If a negotiated settlement is unachievable (and time permits), instruct contractors and administer the works through to completion and lead discussions with the landlord over any subsequent arguments over quality or lease interpretation
- The majority of our negotiations are concluded before lease end with an average 70% negotiated reduction in the tenant’s liability
'David has such a wealth of experience to deliver genuine advice that goes hand in hand with high quality reporting and tenacious negotiating skills. He is my first choice every time'
Quentin Thompson MRICS, Managing Director, Michael Rogers Property Management Limited
'David is the best in the business bar none on dilapidations'
Simon Glenn, Partner, DOWLEY TURNER REAL ESTATE LLP
'On our behalf, Blackmore BC have been very diligent in negotiating dilapidation claims, undertaking pre-acquisition surveys and helped deliver some excellent fit out projects'
David Wilford, Wilson Bowden Developments Ltd, A subsidiary of Barratt Developments PLC
‘David has worked with us providing dilapidations consultancy. His thoughtful, systematic and practical approach has helped us shortcut drawn-out processes and save us significant amounts of money’
Jerome Thomas, Director, Metro Safety
'David is an expert in his field and a pleasure to work with. Over a number of years we have engaged his services on the negation of dilapidation claims for several properties and in every case he has been able to achieve very substantial savings for our clients'
Geoff Meadows, Director, FMS Facilities Management Services Ltd
'David was recommended to me by a former colleague and I can’t speak highly enough about him. He took all the stress out of handling our dilapidations claim and helped get us a great result!'
Nina El-Imad, Director, Simpson Booth
'James has successfully acted for me on numerous projects and due diligence investigations over the last 10 years. His attention to detail and commercial approach are commendable'
Chris Price, Director
Ready to find out more?
Drop us a line today for a free quote!