Churches in the Church of England have to be inspected every five years by a qualified architect to confirm the condition they are in - that's what it is
This is to attempt to keep churches in half reasonable repair – although budgets don’t always allow for perfect maintenance. But how is this relevant to commercial property? The great majority of commercial properties are let on what is called “fully repairing and insuring” leases – under these leases, the tenants are responsible for the whole cost of maintenance and repair of the premises even though they actually belong to the third-party landlord. This is a frequent bone of contention between landlords and tenants – repairs are also demanded when the lease is held on what is called “internal repairing” terms with a Service Charge covering other repairs. Rightly or wrongly, leases are generally biased very strongly in favour of landlords rather than tenants. Now of course, most tenants do tend to look after their premises fairly well, because although it does not belong to them, the condition of the trading premises is a reflection of their business – people don’t necessarily feel comfortable buying from a scruffy shop, particularly if individual purchase items are high end cost. Landlords quite often just leave tenants to look after properties and assume they are in fair order. But this isn’t always the case – and whereas matters can be resolved through the mechanism of a Schedule of Dilapidations (normally served under Section 146 of the Law of Property Act 1925) a number of landlords have been hurt when tenants have ceased trading through liquidation or whatever other mechanism. Landlords have been left with poor condition properties and when reletting have had to give significant discounts to new tenants as well as potentially having to spend money beforehand, with little or no chance of recovery of any costs. Especially in uncertain economic times, landlords need to take a more proactive approach to property maintenance (without impinging on the businesses of the tenants by excessive visits by surveyors) so they can ensure their tenants are looking after their properties and deal with problems sooner rather than later. I have seen some absolute horror stories recently, including a shop where I told the landlord for some years that the fire escape has collapsed meaning that were there to be a fire on the top floor of the building nobody would be able to escape without jumping down from a great height and were there one to be on the ground floor people are also likely to “fry” because the fire escape collapse has blocked the back door of the property. I suspect that the dilapidations are likely to cost well into six figures and I am also quite aware that the tenant is likely to “bleat”. The matter is now going to come to a head because the tenant has asked for an insurance claim form as he believes that the roof is leaking due to storm damage – whereas I am fairly sure that when the insurance company reads the report from the contractors they will say it is wear and tear and will not be willing to pay out – problem number 1. So the building is left effectively uninsured and potentially uninsurable. Problem number 2. Problem number 3 is that in most mortgage documents (and remembering that most commercial properties do have some form of commercial mortgage on them) there is a requirement to keep the property in good repair. I urge all our landlords to consider something like a Quinquennial Inspection -and I hope that more landlords will consider this in the future. It isn’t just churches that need to be maintained; it is all properties for all uses, and everybody should do their part to make sure that these places are cared for, to maintain their structural integrity and value.
