Carter Jonas' Commercial Division is reminding commercial occupiers and owners not to lose sight of the value of property maintenance and repair obligations, even in the current economic climate.
Figures published recently by the Office of National Statistics (ONS) report that expenditure on maintenance and repair of commercial property has dropped from a peak of £4.12billion in the last quarter of 2007 to just £3.2billion in the second quarter of this year (2009) – and in the same timeframe that the capital value of the UK’s commercial property has been reduced by 47 per cent from its peak in 2007.
While acknowledging that budgets are squeezed, for a tenant to neglect obligations under a full repairing lease could have serious legal implications, says Guy Pewter who acts as managing agent for several clients in Cambridgeshire, London and the south east.
He also points out that for an occupier who has an interface with the public - be it an outside, business visitor to an office reception or a full-on retail relationship with the public - there is the question of reputation if the property presents as dilapidated in any way, either internally or externally – even at a cosmetic level.
Carter Jonas is also advising landlords to keep up with maintenance programmes in the case of multi-let properties, where it is usual for the landlord to have the responsibility, with tenants being re-charged via a service charge.
It is important to keep the premises in optimum condition at minimum cost in order to keep tenants’ service charge costs down.
Guy Pewter concludes:
"Having a planned, preventative maintenance [PPM] schedule correctly costed and devised in conjunction with building and property experts is the most cost effective way to maintain the real value of the property.
"Spreading costs over a longer period by routine regular maintenance, helps cash flow and ensures a well kept building throughout.
"Property professionals acknowledge the need for flexibility in any programme but there are some elements of maintenance that landlords should not neglect and legal obligations to repair and maintain that tenants are unwise to ignore."