WE FOUND THEIR KNOWLEDGE OF THE

MARKET AND INDUSTRY EXPERTISE TO BE

INVALUABLE DURING THIS PROCESS

Aisling DuffyChief Executive, Certitude

DILAPIDATIONS

DILAPIDATIONDILAPIDATIONS

Dilapidations are a state of disrepair in property for which there is a legal liability to remedy. Failure to observe, prepare or comply with your lease terms can be costly and could lead to legal dispute.

At TSP we help our clients avoid these pitfalls by providing simple, impartial guidance whilst exceeding clients expectations, every time.

DILAPIDATIONS EXPLAINED

TSP begins the negotiation process on your behalf

Settlement

You’ve decided to leave...

• Landlord claims often are over-estimated• TSP Surveyors meet at property with landlord’s surveyors and initially

validate what has been entered on the schedule• TSP Surveyors contest items and rationalise costs• Consideration given to S.18 (valuation) defence and issues of betterment

and supersession

• If financially settling, agreement is documented and signed• Works would be signed off with landlord• If a dispute arises, advice as to third party action is given

• Your lease expiry or break option triggers the landlord’s dilapidations claim• Process starts approximately six months before lease event, but can be

earlier for large properties

THE TSP 5 POINT PROCESS

• Dilapidations schedule requested from landlord• All items of reinstatement / disrepair / decoration identified• Property inspected by landlord’s surveyors• Landlord’s financial claim established and is presented to you in the form

of a schedule of dilapidations, sometimes called a ‘Scott Schedule’• TSP analyses the schedule, your lease and any other circumstances before

attending the site and beginning negotiations• RICS endorsed Dilapidations Protocol followed throughout

• Depending on landlord’s response and the case as a whole TSP will recommend either financial settlement or carrying out works

• If works are required, TSP project manages and delivers completed refurbishment to the required standard

• S.18 valuation undertaken if required• If financially settling, final amount is agreed with landlord

Calculating the final cost to you and assisting where necessary in carrying out any works

The landlord is now entitled to seek damages to bring the property back to a lettable condition

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DILAPIDATION DEFINITIONS

CASE STUDIES TSP SUCCESSES

RICS ENDORSED DILAPIDATION PROTOCOL This is a framework for the dilapidations

process, defining how long each side should take to respond to the other, and the manner

in which they should do so.

THIRD PARTY ACTION If the surveyors appointed by the landlord and tenant are unable to reach an agreement, the settlement can be decided by a third party. This is usually an Independent Expert or Arbitrator.

S.18 VALUATION This is a specialised type of property valuation. It defines the loss of value the landlord has suffered as a result

of the property’s disrepair.

SCOTT SCHEDULE This is a list of repairs required, prepared by the landlord’s surveyor and quantifying the

amount of their claim.

BETTERMENT & SUPERSESSION These are terms used if the landlord intends to improve the property beyond the level required by the tenant’s lease. They could render any tenant works valueless and consequently the landlord’s claim can be limited.

DILAPIDATIONSThis is the term for the repair and

reinstatement you are responsible for at the end of your lease.

8,000 SQ FT

INITIAL CLAIM £160K

TSP SETTLED FOR £60K

LENGTH OF PROJECT 3 MONTHS

CLIENT WAS EUPHORIC!

£100K SAVINGS

4,000 SQ FT

INITIAL CLAIM £45KTSP SETTLED FOR £10KLENGTH OF PROJECT 4 MONTHS

CLIENT WAS EXTREMELY HAPPY! £35K SAVINGS

3,000 SQ FT

INITIAL CLAIM £54KTSP SETTLED FOR £2KLENGTH OF PROJECT 6 MONTHS

CLIENT WAS SPEECHLESS! £52K SAVINGS

5,000 SQ FT

INITIAL CLAIM £60KTSP SETTLED FOR £38KLENGTH OF PROJECT 6 MONTHS

CLIENT WAS THRILLED!

£22K SAVINGS

AVOID COSTLY PITFALLS WHEN NEGOTIATING ON YOUR DILAPIDATIONS BY SEEKING ADVICE FROM TSP’S EXPERT PROFESSIONAL TEAM

TSPCommercial Property Services 190 Camden High Street 020 7284 9040London, NW1 8QP www.tspuk.com @thirdsectorprop

Third Sector Property is Regulated by RICS | RICS Firm No. 717029 | Company Registration No. 6807280 | VAT No. 977 5366 61

Client references available on request