Propitas was appointed on behalf of Western Digital, to carry out a pre-acquisition survey of this 20 years old, 11,020 sq ft office building, prior to them agreeing a new ten year, full repairing and insuring lease.
The existing tenant was vacating the property but acknowledged that there was a dilapidations liability to discharge. We therefore had to establish what this liability was and either accept or challenge whether the figure being proposed by the outgoing tenant, was a reasonable offer to cover the inherited liability.
We worked with our services engineer to inspect the property and assess not only the current dilapidations liability but also establish what future liabilities might arise and attract a significant cost to our client, on the basis that they were taking a lease on the premises without a limitation on the repairing and reinstatement obligations.
HOW PROPITAS ADDED VALUE
Having completed our survey, we quickly identified that the proposed figure of £100,000 that the outgoing tenant was offering to cover our client’s inherited dilapidations liability, was insufficient.
Our appreciation of dilapidations matters and understanding of what elements of the building may fall into disrepair over the course of the new ten year lease, given the building’s current age, meant we were able to highlight to the client what additional costs may be due, and assisted in negotiating a much improved financial contribution from the outgoing tenant.