If you own and rent out a commercial property, you will have made a legally binding contract with your tenant, or lessee. This will clarify the obligations you have to maintain your property, and specify any charges you must pay in relation to it, as well as outlining the rights you hold over the property you own.
Your tenant or lessee will be renting your commercial property in order to run their business, rather than for residential purposes. This type of lease is subject to many clauses and conditions, and it is important to be familiar with these to protect yourself and your investment. Here at Irwin, Kilculllen & Co Solicitors, we specialize in property law, and we can help you to ensure that your contracts are watertight and legally binding, as well as assisting you with any legal matters that may arise regarding your property.
What Must A Commercial Property Landlord Do?
- Agree rent. Since a commercial lease is more complex than a residential lease, you may need to negotiate with your tenant regarding the rental fees. You may ‘opt to tax’, and your tenant will usually pay stamp duty and a rent review fee, and it is vital to obtain legal advice before signing a contract that concerns your property. Rent review will be governed by a clause in your contract, and you should be aware of the need for clarity in this area and state how rent adjustments will be approached.
- Agree fit out period. As a commercial tenant, your lessee may expect an initial rent-free period in which he or she may prepare the property for the commencement of business. You will need to negotiate this before you both sign the lease agreement.
- Check insurance. Most commercial leases in Ireland are full repairing and insuring leases, in which it is the responsibility of the lessee to insure the property against damage to the building or those who use it. This will usually include third party or public liability insurance. This type of lease will state that the tenant is responsible for all insurance, and all external and internal repairs. You must check this carefully, since some leases specify that the landlord is liable for structural and external repairs, and you must ensure that your interest is noted on the tenant’s policy and check that the premium is paid.
- Confirm legal rights. You should be aware that once a tenant has been in your property for five continuous years, he or she will qualify for the right to renew the lease, unless the terms of the lease have been broken. Landlords may invoke a ‘deed of renunciation’, so that a tenant renounces this right of renewal, but this cannot be renounced if the tenant has occupied the property for more than twenty years. In cases where the landlord terminates the lease although the tenant is not at fault, the tenant will be entitled to compensation.
- Get references. It is vital to protect your interests and ensure that your tenants will take care of your property, so do not overlook the importance of taking up business and bank references.
- Check the details. You should provide an inventory that specifies all your fixtures and fittings, and you should check this with your lessee before the contract is signed. A survey of the property should be made before the lease becomes active, and any major repair work required should be identified and addressed prior to signing the lease.
Find Property Solicitors in Cork
Whether you are a landlord or a tenant, we will be happy to help you with your commercial property lease. Here at Irwin, Kilculllen & Co Solicitors, we specialize in property law, and we will ensure the best outcomes for you. Simply contact us online or call us today on +021 4270934 to see how we can help.