Repair—a tenant’s practical lease negotiation guide
Repair—a tenant’s practical lease negotiation guide

The following Property guidance note provides comprehensive and up to date legal information covering:

  • Repair—a tenant’s practical lease negotiation guide
  • Landlord’s repair objectives
  • Tenant’s repair objectives/questions to ask at heads of terms stage
  • The importance of a survey and due diligence
  • Agreements for lease—practical completion
  • Identifying the premises
  • ‘Good and substantial repair and condition’—meaning
  • Limiting liability by reference to a schedule of condition
  • Insured risks/uninsured damage
  • Inherent/structural and latent defects
  • more

Landlord’s repair objectives

The key aims for the landlord are to:

  1. shift as much responsibility for the repair of the premises as it can onto the tenant, and

  2. to maintain the value of its investment

While this might have seemed fair in a lease with security of tenure under the Landlord and Tenant Act 1954 (LTA 1954) and a 25-year term, it is nonetheless standard even in the current market where lease terms have got shorter and leases are mostly excluded from the security of tenure provisions of the LTA 1954. The effect is that tenants may be carrying out repairs primarily for the benefit of the landlord.

Tenant’s repair objectives/questions to ask at heads of terms stage

The tenant is likely to find it difficult to convince the landlord to accept anything less than an obligation to keep the premises ‘in good and substantial repair and condition’ (or a similar variant of it) as this is the institutionally acceptable position and having a lease without it will affect the marketability of the landlord’s asset. The tenant may, however, be able to modify the clause if the premises are old, in poor condition, the market is difficult, or if the term is very short (eg less than 3 years).

The head of terms are likely to state simply that