Are you a tenant renting a commercial property that could do with some alterations? If so, there are some things that you need to consider before you start any work.
Most commercial leases will require that you obtain consent from your landlord before making any alterations to the property. This is usually documented in a 'Licence for Alterations'. The purpose of the licence is to record all works that alter the property and to protect the landlord's interests and those of other tenants where you share a building.
Whether consent is required (or not) will be determined by the scope of the works and what the lease says. Generally, landlords place a restriction on the extent of alteration or other changes and improvements that the tenant can make during the term of the lease, without the landlord's consent.
Why do tenants need a licence to alter?
If you are a tenant, it is important to establish whether a licence is required prior to commencement of any works, otherwise:
You will almost certainly be in breach of the lease terms and may expose yourself to legal action being taken against you;
You may experience difficulties in disposing of your property if you can no longer afford to pay the rent and you want to find a substitute tenant to take over the lease, for example if you have made unregulated changes to the detriment of the property;
It may be difficult and more costly for you to apply for consent from the landlord retrospectively, once the works have been finalised.
Tenants' responsibilities with property alterations
The tenant is responsible for providing the proposed scope of works to the landlord, this typically includes the preparation of drawings and specifications. The landlord will ask for certain conditions to be met and those will all be documented in the licence to alter. It's important to know that all works would be at the tenant's own cost, which costs may include the landlord's cost of appointing his own team to review the drawings and plans.
Landlords' responsibilities with property alterations
The license is normally prepared by the landlord's solicitor and issued to the tenant's professional team for approval.
Licences for landlords and tenants
The specialist commercial property solicitors at LHS deal with licences for both landlords and tenants and can provide advice about everything that needs to be included in a licence.
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