Commercial property – EPC clarity required?

by Readers Question

11:09 AM, 18th November 2020
About 2 weeks ago

Commercial property – EPC clarity required?

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Commercial property – EPC clarity required?

I have commercial premises currently let to a tenant, and they use it as a dance school. Current lease comes to an end in December (we purchased the property with her as a sitting tenant and this original lease has an end date of Dec 2020), but we have no hesitation in leasing it again to her probably for 3-5 years on a rolling contract.

I have just checked the EPC. Issued in 2017 (just before we purchased the building) and rated F.

Can I actually re-let as it is lower than an E? Is a Dance Studio exempt as I think it comes under Class E(d) commercial classification?

Can anyone help with some advice on this, please?

Reluctant Landlord


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Comments

Freda Blogs

16:59 PM, 21st November 2020
About 2 weeks ago

Reply to the comment left by Hedley at 21/11/2020 - 12:19
Hedley: I can’t see that we have enough information from the OP to be able to say that the lease is contracted in to the L&T Act 1954. It could just as easily be contracted out (as many commercial leases are these days). In my view it is unwise for the OP to hang around to sort the EPC works before serving a notice when we don’t know the facts.

I go back to my original suggestion for the OP to take proper legal advice. The way forward should emerge from those discussions.

Hedley

17:42 PM, 21st November 2020
About 2 weeks ago

I take your point if the lease has excluded the act. The default position is that the Act applies.
The main point is to instruct either a solicitor or chartered surveyor, either of which will read the lease in full before giving advice. The benefit of using a surveyor is that advice will be given on the rental value and general terms of any renewal lease. A solicitor will, of course, be used, if a new lease is to be granted, to draw up the document.

Hedley

17:57 PM, 21st November 2020
About 2 weeks ago

You have started me off on this. If the current lease has not excluded the Act then my original comments are OK, you can let the lease hold over until you want to renegotiate a new lease and you have to serve a section 25 notice.
If however the lease has excluded the Act and you want the tenancy to continue you may again leave matters as they are BUT and this is a big but, if you want the premises back you must not demand rent for any period after the expiry date, or you may have created a new protected lease.
Again, I stress, this can be a minefield - you need professional advice.

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