Initial Agency & Property Management Advice

This document provides initial agency and property management advice, covering topics such as opposing a section 26 notice, lease obligations, dilapidations, locational issues, and more. It offers solutions to common property management challenges and provides expert insights.

Initial Agency & Property Management Advice
Initial Agency & Property Management Advice
Student Name
Institute Name
Date
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Initial Agency & Property Management Advice
Table of Contents
Task A.........................................................................................................................................................2
Task B.........................................................................................................................................................4
Task C.........................................................................................................................................................5
Locational Issues and Demographics.......................................................................................................5
Description / specification.......................................................................................................................5
Size and layout........................................................................................................................................6
Commentary on issues which arise from your Lease Synopsis affecting marketing or value + any other
pertinent legal considerations..................................................................................................................7
Comparable Evidence..............................................................................................................................7
Planning Consents + Alternative Uses, Planning Restrictions and User restrictions in the Lease............9
Market and Demand Supply..................................................................................................................10
Business Rates and Service Charge Considerations..............................................................................10
Justification of Your Asking Rent and Likely Achievable Rent............................................................11
Commentary on the Other Key Lease Terms Which You Recommend.................................................12
Marketing Recommendations to Explain Your Proposed Budget..........................................................13
References.................................................................................................................................................14
Appendix...................................................................................................................................................16
Task A
According to law when a landlord serves the tenant a counter notice after receiving the notice of
the tenant under LTA 1954, section 26 notice, it can be suggested that the landlord can consider
several list of sections including 30(1), (e), (f) and (g), for the opposition of section 26 notice
(Chambers, An Introduction to Property Law in Australia , 2019).
Opposing a Section 26 Notice
The Landlord and Tenant Act 1954, s26(6) (LTA 1954) prescribes that a landlord has the right to
serve the notice on the tenant for the opposition of the application in the court so that he can
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obtain grant of a new tenancy mentioning the grounds and details of the opposition as and when
required. The grounds to oppose the same has been prescribed under LTA 1954, s30(1). Apart
from that the same has also been explained in Halsbury’s Laws of England, basing on the
grounds of opposition generally (Chambers, An Introduction to Property Law in Australia ,
2019).
Under section 30(1) (e), the landlord can oppose the application filed for new tenancy an also
can also apply for a fresh application for the termination of the tenancy without the new tenancy
grant by the court (Chambers, An Introduction to Property Law in Australia 4e, 2018). This can
be possible where the present tenancy has been created by subletting only a part of the property
and the landlord can gain more rent with the help of tenancy for the entire property (Australia,
2019).
Under section 30(1)(f), the ground for the application for the termination of the present tenancy
the landlord intents to reconstruct or demolish the property or premises in consisting the holding
or a substantial part of the property premises or in order to carry out certain work in relation to
construction for holding a part of the premises that he can rightfully do so without getting the
holding possession of the property (Freehill, 2019).
Under section 30(1)(g) the ground for the application for the termination of the present tenancy
the landlord intents to occupy the purpose of holding, whether it may be fully or partly for
business purposes (Australia, 2019). The landlord can have the intention to occupy the said
premises as existed at the time of the occupation performed by the tenant and the in case the
intention of the landlord is to demolish the premises and has plans to reconstruct a new
premises and occupy the same, then he can rely on section 30(1)(f) (Lawman, 2019).
Statutory Compensation
Considering the grounds that can be included in the aforesaid opposition of the notice 26, the
section 37 of LTA 1954 prescribes other things that a tenant has the right to get including
compensation in case the tenant refuses to new tenancy basing on the grounds of section ss30(1)
(e), (f) or (g). of LTA 1954 (Hardwicke, 2015).
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Task B
A lease is generally termed as a positive obligation on the part of the tenant to hand over the
vacant possession of the premises after the expiry of the tem, to have the restored premises to
such condition which was at the time of the commencement of the lease term (Society, 2019). In
some of the case, the property can be yielded up to the landlord of in a better condition
regardless of the previous condition before the commencement of the term (Lawman, 2019).
Basically, the landlord does not have the obligation to serve the dilapidation Schedule and the
tenant must request that the lease mentions the obligation of the landlord to ( Tom Davy,
Vanessa Byrne, Michael Doran, 2018);
Provide or serve dilapidation schedule which is not more than six months before the expiry of the
lease term; and (Chambers, An Introduction to Property Law in Australia 4e, 2018)
Acceptance of payment in place of dilapidation work and the confirmation sum which can be
accepted for the same (Property, 2009)
Payments for Dilapidations
The tenant must consider the problem of dilapidation at the initial stage so that it can have the
option to carry out the needed work and secondly the negotiation of dilapidations for the
payment with the landlord (Commission, 2019). The terms and conditions for the dilapidation
clause and work license can be reviewed for the confirmation if the tenant has the obligation to
remove any sort of alteration that has been made in respect of the property (Government, 2019).
The tenant has to agree with the schedule meant for dilapidation with the landlord in advance for
the expiration of the lease (Australia, 2019). If the conditions of the schedule which is mentioned
as the conditions of the property at the time of the commencement of the lease which is
associated with the lease that can limit the repair obligation of the tenant so that he may not be
obliged to yield up the property in any condition at the time of the commencement of the term
(Nexis, 2019).
Conclusion
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The yield up regulations in a lease must be examined in advance for the expiry term to make sure
that the tenant has ample of time to do the works in respect of the property including removal of
fixtures and fittings, and make sure that the sub tenant or license has been removed from the
property and vacates the property as per the time frame (Freehill, 2019). In case, the tenant does
not have the intention to do so and carry out the work for the payment of the dilapidation to the
landlord which can be agreed in advance of the expiry of the lease as mentioned in the lease
agreement (Chambers, An Introduction to Property Law in Australia , 2019).
Task C
Locational Issues and Demographics
The company has its stores in three regions namely in region one it covers an area of 25
kilometers covering South and east part of London and m3 motor way. In region two it covers all
the areas of wales, east Anglia and south west portion. Apart from that it cover the western and
southern part of London and East south part as well. In the south it covers, Northrn Ireland,
Scotland. In Region three northern Ireland and Scotland to the North and also covers
Nottinghamshire, Lincolnshire, Cheshire and Derbyshire. (Australia, 2019).
The shopping center has its own locational issues as this is very far from the populated areas.
However, it is located in a business place of which all people may be aware of. The units are
located at Blackbrook Valley Industrial Estate, a famous warehousing and industrial area.
Blackbrook Valley Industrial Estate is situated on Intu Victoria Centre Way which has complete
access to Peartree Lane and A4036 Pedmore Road which ultimately provides access to the A461
Dudley Southern By-pass. M5 Motorway’s Junction 2 is about 6 kilometers far from the Black
country area and the national Motorway network (Government, 2019).
Description / specification
JLL’s Retail OSCAR has ample of shopping centers according to the preference and budget of
the client. Units 14 of Intu Victoria Centre Way provide two warehouses which is quite large
and secure yard. The unit benefits from various work offices and other units are constructed with
clock elevations and brick. The floor of the unit is made of concrete. The roof profile clad is
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insulated and also lined for the intermittent of the incorporates with sodium and fluorescent roof
lighting ( Tom Davy, Vanessa Byrne, Michael Doran, 2018).
The unit also has vehicle access 24 hours with two electric operators with the roller shutter door.
The measurement of the door is 15’ 1” high x 14’ 1” wide approx (4.5m high x 4.0m wide). The
height of the unit in minimum is 4’10” approx (4.9m) rising to 19’ 12 (5.9m) on the corner. Each
complex has its own distinct area for parking of car and front loading and (Lawman, 2019). A
divided lading area has also been provided and the car parking area also separates the
warehouses. Unit 50 is a secure yard area and it also has an additional office for accommodation
on the first floor of the building (Nexis, 2019).
Size and layout
The shopping center is unique so as its each and every unit. Thus, it is really very important to
consider the construction age and the levels of electrical and mechanical equipments and also the
common space for the specification which may differ as compared to other retail property of
Retail OSCAR (Walters, 2019). The measurement of the door is 15’ 1” high x 14’ 1” wide
approx (4.5m high x 4.0m wide). The height of the unit in minimum is 4’10” approx (4.9m)
rising to 19’ 12 (5.9m) on the corner. Each complex has its own distinct area for parking of car
and front loading and (Lawman, 2019). A divided lading area has also been provided and the
car parking area also separates the warehouses. Unit 50 is a secure yard area and it also has an
additional office for accommodation on the first floor of the building (Nexis, 2019).
The Retail OSCAR contains 240 shopping centers in total. It covers more than 72.5 million
square feet. The average service charge which excludes the exceptional income and expenditure
is;
Air coniditoner Enclosed £7.67 per sq ft
Non- Air conditioner Enclosed £5.73 per sq ft
Part Enclosed Air conditioner £5.59 per sq ft
Part Enclosed Non Air conditioner £4.48 per sq ft
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Open £3.96 per sq ft
Commentary on issues which arise from your Lease Synopsis affecting marketing or value
+ any other pertinent legal considerations
The fact that it has been asked for the organization of the new tenant rather than sub letting or
assigning the unit that the flexibility is greater as it cannot be constrained with the terms of the
current lease (Hardwicke, 2015) A lease synopsis is an important document in relation to
providing various property management benefits. Standardization is required in a lease synopsis
and as a result different terms can also be affecting negatively for the property (Chambers, An
Introduction to Property Law in Australia 4e, 2018).
There are many good reasons to acquire the property as it has a lease structure which is
standardized in nature. The basic common thing in lease across the shopping center is the
service charge that can provide a lot of management benefits. Standardization is also considered
as an important factor for the investors that they can hotchpotch the different terms that can
negatively impact the value of the investmen (Lawman, 2019)t. However, thus needs to be
adopted as a broad framework in some of the areas including service charge, rent reviews, repair,
alienation and insurance. The person who will become the next tenant will get flexibility over
the length of the lease, incentives, deposits, option breaks and security of the duration provided
(Chambers, An Introduction to Property Law in Australia , 2019).
Comparable Evidence
Some of the key issues that can be considered that can be arise from the lease standard so far that
it can affect the rental value and marketability of the units (Hardwicke, 2015). The tenant has to
consider this type of issues before any sort of consideration. The insertion of green clause must
also be considered which are covered in the class. ( Tom Davy, Vanessa Byrne, Michael Doran,
2018)
The landlord is required to provide the evidence that the case and the date of hearing. This can be
better analyzed and explained with the help of a leading case law (Nexis, 2019). In the case,
Betty's Cafés Ltd v Phillips Furnishing Stores Ltd, the court analyzed that the available affairs of
the notice should be there at the date of providing the notice of the landowner and also the
hearing date.
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Lord Denning, in this case stated that the landlord must provide the ground in the notice for the
establishment of current time of the hearing (Walters, 2019). He also added that they should
provide their information truthfully and honestly. They will also be considered as the preparatory
of pleading for a trial in the parties (Lawman, 2019). He also added that he has regrets to
mention that the sometimes the truth gets denied and people refuse to admit the same in case it
suits the campaign plan. Lastly, he stated that these notices are considered to act upon before the
trial process (Society, 2019).
Similarly, in case of In Hough v Greathall Ltd, which is considered as another leading case in
relation to LTA 1954, s30(1)(f), The court concluded that the landlord need not have to be there
in place the notice date and all the factors which can held him prove regarding his intention at
such time period (Australia, 2019). The essential date on which he may provide evidences of his
intention is the hearing date (Hardwicke, 2015). The landlord is not needed to prove the he also
has the specified intention on serving of notice day (Walters, 2019).
It can be said that it will detrimental on the part of the landlord in respect of cost that can be
included on the grounds which he don’t have the intention to rely and the same are inconsistent
in nature (Walters, 2019). The addition of the unnecessary ground can also force the tenant to
prepare a case so that it can meet the objections as required (Chambers, An Introduction to
Property Law in Australia 4e, 2018). Apart from that the landlord also requires to understand the
fact that the few of the grounds will provide the tenant the way for the consideration of statutory
compensation (Australia, 2019).
However, there are certain other grounds that can be applicable in case the landlord would like to
include them (Australia, 2019). No authority has the right to revise the opposition’s grounds as
mentioned in the notice as there will be a risk for the new tenant to grant if the landlord only
consider on a single ground and the opposition of the landlord for the aforesaid ground will be
failed (Walters, 2019). The same has been decided in the case of Nursey and Another v P Currie
(Dartford) Ltd. In the aforesaid case, a landlord can be considered as wise if he can rely on the
section 1(f) and 1(g) under LTA 1954 (Moore, 2016). Alternatively if he desires to get the
occupancy of the premises and the same requires some sort of renovation work (Freehill, 2019).
Thus, if the court finds out about the renovation work in that case the landlord may succeed
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basing on the ground under section 1(f), in case if that is not the case, then he can also get
successful under section 1(g) (Freehill, 2019).
Planning Consents + Alternative Uses, Planning Restrictions and User restrictions in the
Lease
The landlords of shopping centres where the customer has wants to walk have to take a drive as
per their convenience and when there are no alternatives available for the customers the ruling of
the same can be reported to the in the relevant authority ( Tom Davy, Vanessa Byrne, Michael
Doran, 2018). As mentioned in the land agreement in case of any ruling the first thing is to report
the case along with the specified application for competition law (Lawman, 2019).
This can be better understood with the help of a leading case law which was decided in the
context of permitted use of premises in the case of Martin Retail Group (MRG). The aforesaid
premises have shopping centers for grocery, housing estates and also alcohol (Lawman, 2019).
The landlord, in the aforesaid case opposed the application filed in Crawley Borough Council
stating that each and every shop’s parade must be of different use and that there was also a
grocery shop in the premises (Moore, 2016). The Council in this context considered his plea and
concluded that the use restriction can be considered as anti-competitive. It is argued that
exemption must be allowed under property law. ( Tom Davy, Vanessa Byrne, Michael Doran,
2018)
However, country court in its preliminary ruling found that the council is not satisfied the
cumulative criteria needed for exemption and anti-competitive provision (Property, 2009). In
order to get this done controlled contribution improvement in distribution for promotion
technical and progress economically (Australia, 2019). The consumer are allowed fair share in
result of advantage for imposition of the restrictions beyond the indispensible for achievement
these objection for elimination of competition for grocery in the housing complex (Chambers,
An Introduction to Property Law in Australia 4e, 2018).
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Market and Demand Supply
The transportation factor also plays an important role. When a location has good facility for
transportation then the cost of the property will ultimately rise and the demand for the same will
rise and this area which has a good transportation facility and they buyer will rent the property
even if the rent is high (Hardwicke, 2015). Rate of Interest is another factor for the supply of
property as higher rate of interest will lead to lower the market demand as most of the businesses
obtain loan from the bank (Freehill, 2019). The market demand of the shopping center Higher
incomes reflect the financial position of an individual (Chambers, An Introduction to Property
Law in Australia 4e, 2018). Considering the current demand of rent and shopping complexes
people are earning more and also engaged in multiple business gives rise to demand in rent very
high (Lawman, 2019). Every people these days are working and are earning according to the
standard rate of wages in Australia (Government, 2019). Apart from higher rent, demographic
also plays an important role in supply and demand of rent. The demographic details of an area
also impact a lot in rise and fall in rent system of a commercial complex (Property, 2009).
Business Rates and Service Charge Considerations
The expenditure of Management includes the fees for management, the overall account of the
manageable resources, the average types of center is 30.82% which suggests that there is no such
variance from the last year. (Government, 2019).
Utilities have also decreased from the past year in all complexes except those which are termed
as open centers. Surprisingly, the open centers do not have that much of liability for the
reduction of cost with the introduction of sustainable programs and initiatives. The average of all
center types is less than 8.89% as compared to 8.99% last year. (Chambers, An Introduction to
Property Law in Australia , 2019)
Services in relation to software also represents that it was the most intensive labor cost category
which will be considered as main service charge component while measuring in terms of
percentage at almost half of the price of expenses, with an average rate of 49.38% which will be
considered as a little reduction from the past year that is 46.92%. (Australia, 2019)
The aforesaid factor comprise of the following;
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Security: 20.38% from 22.35%
Environmental and Cleaning Charges: 19.06% - 19.11%
Promotions and Marketing: 5.94% - 6.45%
Services of hardware including the repair of fabrics, maintenance, M & E on an average for
16.90% of total price with M & E coming to 9.39% on an average for all types of centers.
(Lawman, 2019).
Justification of Your Asking Rent and Likely Achievable Rent
According to the lease agreement the rent of the shopping center will be £372,000 (three hundred
and seventy two thousand pounds) pox. Of outgoings and value added tax are also paid on
quarterly basis in advance. Apart from that a rent free duration of 10 months also began from the
date of commencement of lease. (Freehill, 2019).
The rent for the shopping center is high as it has many facilities including also has vehicle access
24 hours with two electric operators with the roller shutter door. The measurement of the door is
15’ 1” high x 14’ 1” wide approx (4.5m high x 4.0m wide). The height of the unit in minimum is
4’10” approx (4.9m) rising to 19’ 12 (5.9m) on the corner. Each complex has its own distinct
area for parking of car and front loading and (Lawman, 2019). A divided lading area has also
been provided and the car parking area also separates the warehouses. Unit 50 is a secure yard
area and it also has an additional office for accommodation on the first floor of the building
(Nexis, 2019).
In case a tenant remains and over holds the possession of the property after the expiry of the
lease that has to be carried out for the dilapidation work before vacating premises, the landlord
can also claim for some additional compensation for the loss of tent as a result of delay in re-
letting the property (Society, 2019). The entitlements of the landlord for the compensation or
additional rent generally depends on the cases that the tenant can ensure regarding the required
work made for the payment of dilapidation and the vacation of property before the expiry of the
lease term to avoid any sort of dispute (Walters, 2019). If the tenant has been granted any sort of
license, interest or sub lease in the property to a third party, it must make sure that all such
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Initial Agency & Property Management Advice
agreement can be terminated or expired in advance before the expiration of the tenant lease term
(Government, 2019).
There is no particular obligation of the landlord for the acceptance of the payment of
dilapidations (Commission, 2019), the landlord can acquire that the tenant can carry out the
dilapidation works (Lawman, 2019). In case the tenant makes payment with regard to
dilapidation work to the landlord, the it must be documented in the agreement which will be
executed by both the parties i.e. is tenant as well as landlord (Property, 2009). This agreement
will confirm that the payment will be made in full and the final settlement of the obligation of the
tenant under the lease for present, past and future of the lease (Walters, 2019).
Commentary on the Other Key Lease Terms Which You Recommend
The following are some of the key lease terms that can be recommended;
Terms: the only option that the tenant has is that he can break the lease at the end of the
completion of five years that is 20th October 2015. This will be subject to the prior notice of six
months and the conditions must also be fulfilled with overall compliance process including all
the obligation of the lease at the time of the notice period. The aforesaid notice must be attached
by a penalty payment equal to the rent of six months (Chambers, An Introduction to Property
Law in Australia 4e, 2018).
Rent: The present rent of the premises will be £372,000 (Three hundred and seventy two
thousand pounds) Of outgoings and value added tax are also paid on quarterly basis in advance.
Apart from that a rent free duration of 10 months also began from the date of commencement of
lease. (Freehill, 2019).
Reverse: The Lessee will receive as sum of £50,000 premium (fifty thousand pounds) from the
Lessor which will be considered as the contribution in respect of the refurbishment of office.
Works of Tenant: all the improvements of the tenant is subject to the consent of the Lessor and it
must not delayed or withheld by an unnecessary reasons.
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Schedule 8 of the lease synopsis provides the details of the agreement of the landlord that was
proposed by the lessee for the refurbishment of the property and new external signage erection
and also the provision for the fencing of palisade facing the yard. It is to be noted that the
aforesaid work will not be shown in the review of rent. It can be understandable that the
aforesaid work has been carried out considering the license for the alteration and the same must
be signed by the landlord as an acknowledgement of acceptance.
Deposit of Rent: A rent deposit of £85,000 can be held by the land owner in the an escrow
account which will be refundable in case of any financial loss as a result of breach of contract or
non-payment of rent.
Guarantee: The parent company of the lessee has been offering guarantee against the breach of
contract or non-payment of rent or any emergency/covenant during the period of lease.
Marketing Recommendations to Explain Your Proposed Budget
The market demand of the shopping center Higher incomes reflect the financial position of an
individual. Considering the current demand of rent and shopping complexes people are earning
more and also engaged in multiple business gives rise to demand in rent very high (Chambers,
An Introduction to Property Law in Australia 4e, 2018). Every people these days are working
and are earning according to the standard rate of wages in Australia. Apart from higher rent,
demographic also plays an important role in supply and demand of rent. The demographic details
of an area also impact a lot in rise and fall in rent system of a commercial complex (Government,
2019). The transportation factor also plays an important role. When a location has good facility
for transportation then the cost of the property will ultimately rise and the demand for the same
will rise and this area which has a good transportation facility and they buyer will rent the
property even if the rent is high. Rate of Interest is another factor for the supply of property as
higher rate of interest will lead to lower the market demand as most of the businesses obtain loan
from the bank (Lawman, 2019)
References
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Initial Agency & Property Management Advice
Tom Davy, Vanessa Byrne, Michael Doran. (2018, May 16). Ireland: Mishaps With Dilaps – A
Tenant's Guide To Dilapidations. Retrieved from
http://www.mondaq.com/ireland/x/701010/landlord+tenant+leases/Mishaps+With+Dilaps+A+Te
nants+Guide+To+Dilapidations
Australia, L. C. (2019). Australian Property Law. Retrieved from
https://www.lawcouncil.asn.au/legal-practice/our-committees/australian-property-law
Chambers, R. (2019). An Introduction to Property Law in Australia . Retrieved from
http://www5.austlii.edu.au/au/journals/MelbULawRw/2002/10.html
Chambers, R. (2018, December 19). An Introduction to Property Law in Australia 4e. Retrieved
from https://legal.thomsonreuters.com.au/an-introduction-to-property-law-in-australia-4e/
productdetail/126580
Commission, A. L. (2019). Definitions of property. Retrieved from
https://www.alrc.gov.au/publications/definitions-property-1
Freehill, H. S. (2019). Property Law. Retrieved from https://www.herbertsmithfreehills.com:
https://www.herbertsmithfreehills.com/doing-business-in-australia/content/property-law
Government, A. (2019). Australian Intellectual Property laws. Retrieved from
https://www.austrade.gov.au: https://www.austrade.gov.au/International/Invest/Guide-to-
investing/Running-a-business/Understanding-Australian-business-regulation/Australian-
Intellectual-Property-laws
Hardwicke. (2015, December 18). Opposing a section 26 LTA 1954 Notice. Retrieved from
https://hardwicke.co.uk/opposing-a-section-26-lta-1954-notice/
Lawman, N. (2019, April). Section 26 notice: tenant's request for new tenancy. Retrieved from
https://www.netlawman.co.uk/ia/section-26-notice
Moore, A. (2016, June 29). Australian Property Law: Cases and Materials 5th ed. Retrieved
from https://legal.thomsonreuters.com.au/australian-property-law-cases-and-materials-5th-ed/
productdetail/124534
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Nexis, L. (2019). Australian Property Law Bulletin. Retrieved from
https://www.lexisnexis.com.au/: https://www.lexisnexis.com.au/en/products-and-services/legal-
research/newsletter/australian-property-law-bulletin
Property, G. (2009, June 19). Tenant protection laws are neutral. Retrieved from
https://www.globalpropertyguide.com/Pacific/Australia/Landlord-and-Tenant
Society, T. L. (2019). Property Law. Retrieved from
https://www.lawsocietywa.asn.au/committee/property-law/
Walters, J. (2019). Can I estopp you there? Deadlines under the Landlord and Tenant Act 1954
and the role of estoppel. Retrieved from https://www.lexology.com/library/detail.aspx?
g=b094acda-180b-4287-852b-8c6600d8b034
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Appendix
LEASE SYNOPSIS
UNIT 50, BLACKBROOK VALLEY BUSINESS PARK, INTU VICTORIA CENTRE
WAY, NETHERTON, B31 6HR
Lessor (Freeholder) Blackbrook Estates Ltd
Unit 2, Blackbrook Valley Business Park
Intu Victoria Centre Way
Netherton
B31 6HS
Lessee New Group Subsidiary Ltd
10 Back Street
Dudley
West Midlands
B34 1UP
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Guarantor Seriously Wealthy Group Plc
24 Park Lane
London
SW1 1AA
Landlord’s Solicitor Eversheds.
1.0 Demise
Warehouse premises will also include parking area and external yard
A full voltage line of electricity will pass over the site and this will be referred according to
schedule 9 of the lease agreement. The lease also provides that GIA of 6,035 sq m (55,200 sq ft)
will also include ancillary offices.
The lease also provides that the total plots of 3.8 acres including the parking, landscaping and
external yard. The extent of the demise is also shown in red color in the lease plan.
states that the plot totals 2.8 acres including the secure external yard, parking and landscaping.
The extent of the demise is shown edged red on the lease plan.
The lease also provides that the mezzanine floor is of 500 sq m (6000 sq ft).
The lease also provides a 6-tonne gantry crane.
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2.0 Terms: the only option that the tenant has is that he can break the lease at the end of the
completion of five years that is 20th October 2015. This will be subject to the prior notice of six
months and the conditions must also be fulfilled with overall compliance process including all
the obligation of the lease at the time of the notice period. The aforesaid notice must be attached
by a penalty payment equal to the rent of six months (Chambers, An Introduction to Property
Law in Australia 4e, 2018).
3.0 Rent: The present rent of the premises will be £372,000 (Three hundred and seventy two
thousand pounds) Of outgoings and value added tax are also paid on quarterly basis in advance.
Apart from that a rent free duration of 10 months also began from the date of commencement of
lease. (Freehill, 2019).
4.0 Reverse: The Lessee will receive as sum of £50,000 premium (fifty thousand pounds) from
the Lessor which will be considered as the contribution in respect of the refurbishment of office.
5.0 Works of Tenant: all the improvements of the tenant is subject to the consent of the Lessor
and it must not delayed or withheld by an unnecessary reasons.
Schedule 8 of the lease synopsis provides the details of the agreement of the landlord that was
proposed by the lessee for the refurbishment of the property and new external signage erection
and also the provision for the fencing of palisade facing the yard. It is to be noted that the
aforesaid work will not be shown in the review of rent. It can be understandable that the
aforesaid work has been carried out considering the license for the alteration and the same must
be signed by the landlord as an acknowledgement of acceptance.
6.0 Deposit of Rent: A rent deposit of £85,000 can be held by the land owner in the an escrow
account which will be refundable in case of any financial loss as a result of breach of contract or
non-payment of rent.
7.0 Guarantee: The parent company of the lessee has been offering guarantee against the breach
of contract or non-payment of rent or any emergency/covenant during the period of lease.
8.0 Rent Reviews
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Initial Agency & Property Management Advice
A five year upward review of rent for open market value of rent with an assumption that the
offices will be of newly refurbished and also irrespective of the all agreed improvements of the
tenant.
The review of rent will be made considering the mezzanine floor.
Essentiality of time
In case of any dispute, it will be referred to an arbitrator.
9.0 VAT
The aforesaid building has been made considering the purpose of value added tax.
10.0 Alienation
Assignment of the overall premises will be permitted under the provisions of Authorized
Guarantee Agreement where it is mentioned that a covenant will not be termed as inferior in case
of the standing guarantor, the approval of the lesser will not be withheld unreasonably as
prescribed.
Only up to 3 subletting will have the permission at any time considering the consent of the
Landlord that will be delayed or withheld unreasonably.
All the sub leases will be considered outside the Act
The sub letting should not be undercut with the passing of rent.
11.0 Service Charge
The Lessee is obliged to a service charge for the maintenance of estate and security that can be
calculated on pro rata basis as per the total built up area of the estate which is presently 15%.
The lease suggests the service charge for rent of service charge.
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Initial Agency & Property Management Advice
12.00 Outgoings
Lessee will be responsible for all the outgoings including electricity, gas, water and foul for the
demised premises.
13.0 User
B1(c) Light Industrial or B8 Storage & Distribution provides that B2 is allowed for the existence
of lessee and the authority of the group organizations. The lessor has the exclusive and absolute
power ro use the discretion over B2 for the use of any assigns and tenants. Apart from that there
is also a prohibition for the movement of HGV that is between 10.00 pm and 6.00 am.
14.0 Insurance
The Lessor will be insured and also recover the premium from the Lessee with the help of
Insurance rent.
15.0 Repair
The lease will be full of insuring and repairing terms. The repair state at the beginning of the
lease will be recorded in a schedule of photography of the condition consent provided by both
the parties to the lease agreement.
16.0 Alterations
Non-structural alterations are not allowed even with the consent of the lessor. It is also to be
noted that it cannot be delayed or withheld unreasonably with any sort of structural alterations
under the consent of lessor.
17.0 Security of Tenure
The Lease is made considering the Part II of the Landlord & Tenant Act 1954.
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Initial Agency & Property Management Advice
18.0 Other Matters
There will be no such agency which will be attached to the building exterior.
PROPOSED LETTER OF ENGAGEMENT (SECTION 18 LETTER)
Damages for breach agreement will keep premises in repair that it shall not exceed the amount
for the covenant agreement by the value of the reversion. The premises will ultimately diminish
as a result of the breach of the agreement.
This can be better understandable with the help of an example. In simple words when the value
of a property is £100,000 and cost of repairing is 50,000 then the total of the property £150,000
once the repairing is done. The damages of the measures according to the section 18 (1) would
be £50,000. The lease will be expired as per the valuation assessment.
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Initial Agency & Property Management Advice
However, the act will be applicable for the reinstatement and repair work which excludes
provisions in Section 18. The Dilapidation Protocol suggests that schedules for the reports of
Dilapidation separated in to the reinstatement work, repair and redecorations. The difference
between common law approaches under section 18 for assessment of loss. These elements can
be assessed with reference to the value of diminution as a result of repair.
Practically, Landlord also not required for providing any valuation report in respect of
diminution according to Schedule of Dilapidations and in case a landlord do any sort of property
work for the remedies for breaches for the tenants repairing obligations. The reasonable cost that
can be accepted a measure of damages.
The formal method for assessment reversionary value for carrying valuation of two. The
hypothetical valuation for the assumption regarding the breaches can be rectified. The second
valuation is based on the condition of building.
PROPERTY INSPECTION CHECK LIST
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Initial Agency & Property Management Advice
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Property details Property
Address of property
Age of property
Type of sale
* Private – phone number of the sellers
* Agent - phone number of agent
* Auction – date of auction
Price/Cost
date of Inspection
Location:
* Timing (morning/evening)
* far from:
public transport
work
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Initial Agency & Property Management Advice
INSPECTION NOTES
General information
The inspection note including the following;
Building Interior
Building Exterior
Space for Roof
Space for Floor
Exterior Roof
Site
Operable electrical safety existence
Smoke Alarm
The following things will be included in the inspection report:
Garden Shed, Carpot. Garage
Toilet or Laundry pot
Retaining Wall
Water Drainage
Water Run Off
Driveways and Path
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Initial Agency & Property Management Advice
The inspection report should also include the following information:
Name of Client
Address of the Property
Inspection Date
Scope of Inspection
List of the area which was inspected
Summary of the Investigation
List of Significant Problems
Overall Conditions of Property
Recommendation for any such future Inspection
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Initial Agency & Property Management Advice
Factors for Supply Schedule
Higher incomes reflect the financial position of an individual. Considering the current demand of
rent and shopping complexes people are earning more and also engaged in multiple business
gives rise to demand in rent very high. Every people these days are working and are earning
according to the standard rate of wages in Australia.
Apart from higher rent, demographic also plays an important role in supply and demand of rent.
The demographic details of an area also impact a lot in rise and fall in rent system of a
commercial complex.
The transportation factor also plays an important role. When a location has good facility for
transportation then the cost of the property will ultimately rise and the demand for the same will
rise and this area which has a good transportation facility and they buyer will rent the property
even if the rent is high.
Rate of Interest is another factor for the supply of property as higher rate of interest will lead to
lower the market demand as most of the businesses obtain loan from the banks.
Budget
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Initial Agency & Property Management Advice
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