alterations
Tenants will often want to make alterations to premises leased to them under a commercial lease. Most commercial lease will, however, prohibit or else restrict the alterations tenants are allowed to make. Except in the case of short-term leases (those running no longer than 2 to 3 years), a typical commercial lease might contain the following restrictions:
- an outright ban on tenants making structural alterations to the premises
- a ban on tenants making non-structural outside alterations unless the tenants have first obtained landlords’ written consent
- a ban a ban on tenants making non-structural internal alterations unless the tenants have first obtained landlords’ written consent (which landlords cannot unreasonably refuse to give)
In reality, leases vary greatly – so that the final part of rule (3) above (landlords cannot unreasonably refuse to give consent) may apply to rule 2 or even rule 1. However, given that landlords can usually find some reason to refuse alterations they do not like, the reality is that landlords have a near veto over tenants’ alterations, whatever the exact wording of the restriction. Even if landlords agree to give consent, they (a) may impose strict conditions on their consent and (b) will expect their professionals’ costs to be met by the tenants.
What, then, should tenants do to get their landlords to give consent to alterations? The following are some of the more obvious suggestions:
- Where tenants are still in discussions over the terms of the lease, get the landlords to agree to the alterations before you ever sign up to a lease. If you do not have finalised drawings of the alterations, then at least get the landlords to give consent in principle to the alterations
- For planned alterations during the period of the lease, informally sound out the landlords before formally applying for consent to the alterations. If you sense reluctance on the part of the landlords, then work out what the landlords may want as a trade-off for giving consent – for instance, the extension of the lease or agreement of the revised rent following the next rent review
- Always do your homework in advance. Make sure that the planned alterations will be permitted by the local authority building services department and that no application for planning consent is required. It is usually best to contact the local authority to find out what exact consents will be required, since these can vary from building to building and locality to locality.
In difficult cases, it pays to speak to experienced commercial property solicitors for advice on obtaining landlords’ consents.