By Joanna Kearvell, Head of Occupier Services, Chandler Garvey Ltd

Time

It is imperative to give your business enough time to plan for your lease expiry. Your business needs to consider its strategy at this key time and so you should start thinking about your business premises 12-18 months before your lease ends. 

The right premises?

Challenge yourself to consider if your current property is the right one for your business.

• Does the location still work for you?
• Do the staff work efficiently or is time wasted moving between working areas?
• Is the quality of the space representative of your brand?
• Do you need to reduce your overheads?
• Do you have wasted space, i.e. meeting rooms or private offices not well used?
• What is the business plan for the next 3 / 5 / 10 years?
• Do you need flexibility?

The answers to those questions will enable the business to decide if it should renew the lease or find new premises.

Terms of the renewal

Details such as the length of the new lease and the rent will be negotiated between the landlord and the tenant. However, there are many other points to consider, including the ability to sublet your premises and the dilapidations at the end of the lease.

It is imperative that the tenant takes professional advice in the lease renewal – do you know what the current rent should be?

New premises

If the business has decided to move premises, you must give yourself enough time to do this effectively. Consider the market conditions, how much space you require and in what location before you start searching.

You must leave yourself enough time to find the property and, once secured, go through the legal process (typically 3-6 months) and fitting out of the property (2-4 months) before you must leave your current premises.

Dilapidations

A complicated and often forgotten part of the process. If you are renewing the lease, your dilapidations liability may be carried out to the new lease. If you are taking a lease on new premises, consider the current condition of the premises and what it may take to put it in full repair. Take advice on how to limit and quantify your dilapidations. 

As with all property issues, it is worth getting professional advice from a firm of commercial property consultants.