Potential Costs to Look Out For
Landlords and tenants should review their leases to check who will be responsible for the costs of either maintaining or improving the property in light of new regulations that are being proposed or introduced.
As HCFC Gas (R22) is to become illegal in 2015 owners of air conditioned premises will need to comply with the new regulations. With the uncertainty of when a potential air conditioning failure will occur and at what cost, this could drive down the rental values on review.
If the necessary works are not the tenants responsibility the landlord may well recover this as a cost as part of the service charges.
Also the EU are proposing that come 2018 non-domestic landlords will be obliged to bring their properties up to a defined energy efficient threshold before they can be let. The current proposals are that if the property has an energy efficiency certificate (EPC) rating of less than an “E” it must have a Green Deal Assessment, and any recommended works that pass the test of expected savings to the energy bill must be equal to or greater than the cost of any works.
Therefore check that the EPC rating is better than an “E” before investing in commercial property.