Taking a Lease on a Commercial Property

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Taking a Lease on a Commercial Property

Taking a lease on a commercial property is a significant commitment for any business. Before signing an agreement, it is important to understand the condition of the property, your responsibilities as a tenant and any potential costs you may become responsible for during the lease.

Gowers Surveyors are RICS Chartered Surveyors providing commercial property advice to businesses across Stamford, Cambridge, Peterborough and surrounding areas. We help tenants assess the condition of premises before entering into a lease, identify potential risks and provide professional advice, including preparing Schedules of Condition where required.

When taking a new commercial lease, businesses should consider:

Repair responsibilities – understanding the maintenance and repair obligations set out within the lease, including whether you could become responsible for repairing existing issues or maintaining the property to a specific standard.
Existing defects – identifying problems that were present before occupation, which could otherwise become a tenant’s responsibility during or at the end of the lease.
Future costs and liabilities – understanding potential maintenance, repair and dilapidation costs associated with the lease, particularly where full repairing obligations apply.
Schedule of Condition – documenting the property’s condition before occupation to provide a clear record of its state at the start of the lease and help limit exposure to future repairing obligations.

Obtaining professional surveying advice before signing a commercial lease can help businesses make informed decisions, understand their responsibilities and reduce the risk of unexpected costs during and at the end of the lease.

Gowers Surveyors can provide independent advice to help tenants understand commercial lease risks and ensure they are fully aware of the condition and obligations associated with a property before committing.

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Understanding Your Lease Repair Responsibilities

Taking on a commercial property lease involves understanding exactly what repair and maintenance obligations you may be responsible for. The level of responsibility a tenant takes on will depend on the wording and terms of the lease agreement. Understanding these obligations before signing can help avoid unexpected repair costs and potential disputes in the future.

Gowers Surveyors are RICS Chartered Surveyors providing commercial property advice to businesses and tenants across Stamford, Cambridge, Peterborough and surrounding areas. We help occupiers understand their lease obligations, identify potential risks and make informed decisions before committing to a commercial property lease.

Full repairing lease

A full repairing lease typically places responsibility on the tenant for repairs, maintenance and upkeep of the property throughout the lease term. Depending on the terms of the agreement, this may include addressing defects, deterioration or other issues that arise during occupation.

Before signing a full repairing lease, tenants should consider:

Existing defects – whether any issues are already present and could become the tenant’s responsibility once the lease begins.
Future repair costs – the likely cost of maintaining the property and meeting the obligations set out within the lease.
Schedule of Condition – whether a record should be prepared documenting the property’s condition at the start of the lease, which can help limit future disputes regarding repair obligations.
Dilapidation liabilities – whether the tenant could face significant costs for repairs or reinstatement works when the lease comes to an end.

Limited repair responsibilities

Where repair obligations are more limited, tenants should still understand exactly what they are responsible for throughout the commercial lease term. Lease agreements can vary significantly, and even where responsibilities appear limited, there may still be important obligations to consider.

Professional advice can help clarify:

Which repairs and maintenance responsibilities fall to the tenant.
Whether existing issues should be recorded before occupation.
What condition the property may need to be returned in when the lease ends.
Whether there are potential repair or dilapidation liabilities to consider.

Does the Age and Condition of the Property Matter?

The condition of a commercial property can influence the level of risk involved when taking on a lease.

Older commercial properties

Older buildings may have existing defects, maintenance issues or areas requiring future repair.

A survey can help identify:

Existing problems before the lease begins;
Potential future maintenance costs;
Areas that may require attention during the tenancy.

Newer commercial properties

Newer buildings may have fewer visible defects, but tenants should still understand their responsibilities before committing to a lease.

A survey can help confirm:

The current condition of the property;
Any outstanding issues;
The obligations included within the lease.

Taking a Lease on a Commercial Property FAQs

What is a commercial lease survey?

A commercial lease survey is an assessment of a property’s condition before a tenant enters into a new lease. It helps identify existing defects, potential maintenance issues and areas that could lead to future repair costs.

A survey can help businesses understand the condition of the premises before accepting responsibility for the property.

Do I need a survey before taking a commercial property lease?

While not every lease requires a survey, obtaining professional advice before signing can help identify potential issues with the property and clarify your repair responsibilities.

This is particularly important where leases include repairing obligations, as tenants may become responsible for maintaining or returning the property in a specific condition.

What is a Schedule of Condition?

A Schedule of Condition is a detailed record of the condition of a commercial property at the start of a lease. It usually includes written descriptions and photographs documenting existing defects and the overall condition of the premises.

It provides evidence of the property’s condition when the tenant takes occupation.

Why is a Schedule of Condition important for commercial tenants?

A Schedule of Condition can help protect tenants by recording defects and issues that existed before they occupied the property.

Without this record, tenants may find it harder to demonstrate that certain defects were present before they moved in, which could increase the risk of being held responsible for repairs at the end of the lease.

When should I arrange a Schedule of Condition?

A Schedule of Condition should ideally be prepared before the lease is signed and before the tenant takes occupation of the property.

Completing this early ensures the property’s condition is properly recorded before the tenant becomes responsible for the premises.

Can a survey help identify future repair costs?

Yes. A commercial property survey can highlight existing defects, areas requiring maintenance and potential issues that may result in future costs.

Identifying these matters before signing a lease allows businesses to make more informed decisions and understand their responsibilities.

Does Gowers Surveyors provide commercial lease advice?

Yes. Gowers Surveyors provide professional surveying advice for commercial and residential property clients across Stamford, Cambridge, Peterborough and surrounding areas.

Our team can help businesses understand property condition, repair responsibilities and matters such as Schedules of Condition before committing to a commercial lease.

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