Living Leases Opportunity or Liability?
The Ethical Property Foundation • Nationwide free property advice for charities and community groups • Consultancy service providing strategic guidance and project management • Property education campaign • Fairplace • Resourced via in-house property advice team and Register of Property Professionals: Anthony Collins Solicitors • Free property resource guide via our website www.ethicalproperty.org.uk • Charity Property Matters Survey 2016
Today • What would you like to know • Approach to leasing • What are you looking for? • Taking occupation and understanding risk • Introduction to the Guide • Case studies • Questions
Managing the market • Be prepared • Your outline brief should include: • Location • Type of building • Own v lease • Layout and design • Operational requirements • Standards • Sustainability • Financial • Property search and shortlist
Agreeing commercial terms • Your outline brief will aid surveyors and lawyers • It will save you money • Agents will not bother with the detail • Engage your lawyer before you agree terms
Key messages from the experts • The first rule is risk - “ how easy will it be to assign/terminate the Lease? ” • The second rule is capability - “ is my organisation able to take this on? ” • The third rule is affordability – “do we have the funds to meet this obligation?”
Living Leases • Guide to taking a commercial Lease • Contents of Guide • Purpose of Guide
Preliminary Considerations • Trustees’ duties • Who does what • Due diligence
Main Lease Clauses • Term • Service charge • Break clause • Repairs • Property • Alterations • Rent • Alienation
Lease Clauses continued • User • Landlord and Tenant Act 1954
Charity Law • Taking a Lease • Disposal • Trustees’ duties
Case Study / Workshop
What Happens Next Alteration, adaptation, fit out to accommodate your operational needs Cost • Lowest overall cost or cost certainty? Time • Fastest delivery programme or time certainty? • Lowest quality to reduce capital cost or high quality Quality to reduce lifecycle cost? Flexibility • Flexibility to change or certainty to avoid penalty ? Risk • Accept manageable risks, share or transfer risks? Sustainability • Environmental responsibility or neglect ?
Live and work within your lease • Permissions • Adaptations • Annual maintenance – repair and replace • Responsible person • Health and safety • Insurances • Termination or renewal
Establish processes for….. • Health and Safety • Utilities • Mechanical & Electrical systems • Cleaning • Waste • Furniture, Fittings, Equipment (FFE) • Security • Repair and Replacement • Business Continuity
Case Study / Workshop
Lessons from others and case studies All Ethical Property Foundation
Case Study – Wells House
Summary and conclusions • Review of of issues raised • Feedback forms
Any questions?
Contact Ian Parker – Ethical Property Foundation ian.parker@ethicalproperty.org.uk Tel: 020 7065 0763 Dominic Curran – Anthony Collins Solicitors, 134 Edmund Street, Birmingham, B3 2ES Email: dominic.curran@anthonycollins.com Tel: 0121 214 3632 Laura Mynott - Anthony Collins Solicitors, 134 Edmund Street, Birmingham, B3 2ES Email: laura.mynott@anthonycollins.com Tel: 0121 214 3687
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