Listed below are questions frequently asked by our clients on a variety of subjects.
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Building Survey and Design Services
Q. Why do I require your services?
A. We can guide you through the maze of regulations, including Planning, Listed Building and Conservation Area Consents, Building Regulations and Party Wall Act.
Q. What is the Party Wall Act 1996?
A. This Act defines the rights of owners and the duties of their surveyors should a dispute arise. An owner cannot do what he likes with his own part of the wall. Our appointment as a Party Wall surveyor is a statutory relationship, and our duties are to ensure that the Act is properly complied with.
Q. I have just received a large claim for dilapidations from my landlord. What can I do?
A. We will inspect, cost the Schedule as necessary, and analyse the claim with reference to the lease in order to ensure that the claim is valid and an accurate portrayal of the state of repair. In most cases a claim can be substantially reduced.
Q. I have a tenant who fails to repair my building, what can I do?
A. We will inspect, interpret the lease and prepare either a Schedule of Dilapidations or Wants of Repair Notice, requesting the tenant to undertake the necessary works of repair.
Q. Why do I need a Schedule of Condition?
A. When taking a leasehold interest in a building, unless it has been recently refurbished or constructed, we would advise you to record the condition of the building at the commencement of the lease. Your solicitor should amend the lease documentation to make reference to it, and this will then help to reduce any future liabilities in respect of repairing the building during or at the end of the lease term.
Business Rates
Q. How does the rating system work?
A. Rating is a tax on the occupation of property. Each property is assessed on the basis of 'rateable value', which is an estimate of the yearly rent at which the property might reasonably have been let if available at the time of the valuation date. The most recent revaluation came into effect on the 1st April 2005, based on a valuation date of the 1st April 2003. Revaluations take place every five years.
Q. How does the rateable value relate to my rates bill?
A. The local authority will calculate your rates bill by multiplying the rateable value by the uniform business rate (UBR). In the rate year 2006/2007, the UBR in England is 0.433p. The rates payable may be different from this basis due to the application of transitional relief. This is a system which phases large changes in rates liability between one Rating List and the next, minimising the impact of the revaluation. We can calculate and forecast your rates liability - Click here to email your details.
Q. Can I challenge my rateable value?
A. Rate payers have a right to challenge their own assessments. However, the valuation of a property for rating purposes is complex and requires an understanding of the principles of property valuation as well as knowledge of statute and case law.
Q. How does the appeal procedure work and how long will it take?
A. A proposal is served on the Valuation Office with a view to negotiations being taken up and agreement being reached. In the unlikely event that agreement cannot be reached, the matter will be referred to a tribunal. The Valuation Office is usually unable to discuss appeals before they are scheduled for tribunal. Subsequently, considerable delays normally occur before the appeal is settled and it may be at least six to twelve months before agreement is reached. The local authority is then advised and any refunds are made and future billings recalculated.
Q. Who should I take advice from?
A. There are many organisations offering to advise in connection with rates including a number of 'cowboys'. It is only by employing a corporate member of the RICS, ISVA or IRRV that you can be certain that your rating advisor is:
regulated by rules of professional conduct designed to protect the public from malpractice
qualified by examination, practical experience and training acceptable to central and local government
required by their rules to hold adequate professional indemnity insurance
Q. How and when are our fees charged?
A. Jones Granville provides rating advice on a performance related basis. There are no initial charges or deposits. Our fees are directly related to the reduction in rateable value or the refund achieved, and become payable only once the Local Authority have been notified of the amended rateable value and your revised rates bill has been recalculated.
Commercial Agency
Q. What fees do you charge?
A. As a guide across the industry, fees are normally charged at approximately 10% of one year's rent, or 2% of the freehold value for sole selling/letting rights. However, we would emphasise that this is a guide and fees often differ. We would be happy to provide quotations and further information regarding specific properties.
Q. How long, on average, should it take a sale to go through?
A. This is an extremely difficult question to answer with a single answer, which will differ dramatically between individual properties and depending on the market conditions at the time. As a general guide, we would suggest that three months should be allowed to obtain an offer and a further two months for the matter to go through solicitor's hands. Guidelines that are more accurate can be given for specific properties.
Q. What marketing budget should I allow?
A. As a general guide we would suggest a budget of around 5% of the rental income or ½% of the freehold sale value. Again specific budget will be suggested for individual properties, but this is an adequate guide for the majority of marketing and expenses.
Q. How would I find out the rateable value of the property and rates payable?
A. This can either be done via your local Valuation Office or District Council or by logging onto the Valuation Office web site at www.voa.gov.uk.
Q. Does all rented/leased accommodation carry a service charge?
A. Service charges usually arise where there are shared communal areas not under the control of a single tenant and upkeep of these areas is then organised by the landlord and billed back to the tenant. This can typically be for parking/landscaping of a scheme or upkeep of stairways, reception and structure in a multi-occupied building. Checks should be made with landlords as to the level of service charge and what services are included within the bill.
Commercial Development
Q. Do I need planning consent to realise the development potential of my site?
A. No, there are various structures available where the onus of gaining consent can be passed to a potential acquiring party.
Q. Can I retain some of the development profit for myself?
A. Yes, there are various structures, including joint venture agreements which enable landowners to stay involved in a development process and participate in the profits on some types of development without significant commensurate risk.
Q. Can I sell land with development potential without getting planning?
A. Yes this is possible on some types of development, but will normally involve a lower price being obtained.
Q. Will redevelopment potential be restricted to my land or buildings' current use?
A. No, potential exists in many instances for possible changes of use to be identified which can significantly enhance land value.
Q. Should I sell direct to a developer without advice?
A. No, whilst there may be an initial short term saving in fees, you could lose significantly if the developer was to pay you a price based on a less than optimum development or there is potential for a more financially beneficial use which you are not aware of.
Q. Will the potential for development on my site be the same as in previous years?
A. Not necessarily. Changing patterns of demand, changes in planning legislation will occur over a period of years. A higher density and, therefore, more viable development may be possible on your site, thus making a sale for development more attractive now. Conversely, a planning consent or potential consent which might have been available to you in previous years, may now be unobtainable due to changes in parking standards, government or local authority policies. It is, therefore, important to constantly review the potential of any site on a regular basis.
Corporate Property Management
Q. How do I know that any money you collect on my behalf is safe?
A. Jones Granville complies with Royal Institution of Chartered Surveyors Members Accounts Regulations. We operate "client" accounts and all Chartered Surveyors contribute to the RICS levy which acts as a bond against default on client money.
Q. How often would my property be inspected?
A. The frequency of inspection varies with the type of property and the lease obligations there are on the tenants. Some are visited monthly whereas others do not require visits more than annually.
Q. What do you do if the rent is not paid?
A. Initially all tenants are chased by telephone for unpaid sums. If there is no response from this then action is agreed with the client to instruct bailiffs or solicitors to recover the debt.
Q. What type of property do you manage on behalf of clients?
A. We manage properties ranging from one-off corner shops to modern office blocks with up to 10 tenants. We do however have experience of all types of properties.
Development Land
Q. How much is my site/property worth?
A. This will depend upon a considerable number of factors but with the starting point being to ensure that any planning consent maximises its value. We, therefore, test the viability of all land use options before expressing our professional opinion, based upon our extensive track record and accurate knowledge of the various elements within a development appraisal.
Q. What is the best way to sell my property?
A. This will depend upon your timescale requirements, and the nature of your property. We regularly sell land by all methods being outright sale by tender or private treaty, conditional contract, option, joint venture etc., and can achieve the best solution for your needs to maximise its value. Following an agreement to sell we liaise closely with solicitors to ensure that any contract fully protects our clients’ interests.
Q. Do I need to get planning permission before selling?
A. Not necessarily. If the principle of redevelopment is accepted then we have sold many sites without the delays for planning permission which can often be a lengthy process.
Q. Is now the best time to sell?
A. Demand for development land remains strong. Therefore, many owners are making the decision to sell and instructing our Company, but we would of course assess each case on its merits.
Q. Why should I instruct Jones Granville?
A. Jones Granville has a long established track record at selling development land for residential, mixed use and commercial purposes. We pride ourselves on finding innovative solutions to difficult cases and we would be entirely confident to supply references of companies who have benefited from our expertise. Why not ring for an informal and confidential meeting ̶ without obligation.
Dilapidations
Q: What are Dilapidations?
A: The phrase “ Dilapidations” describes items of disrepair to a building under the terms of a lease, for example, a leaking roof or peeling paint on a window frame, to name but two of many potential examples.
Dilapidations are often considered by tenants to be a peripheral issue in comparison with rent, rates and service charges when they are looking for new premises. However, the liability to repair can have serious financial implications and therefore the tenant should seek advice from a chartered surveyor with regard to the opportunities to limit or mitigate dilapidations before entering into a lease.
Q: What are types of Schedule and Tactical Considerations?
A: Where breaches of repair occur under a lease the landlord may serve a Schedule of Dilapidations on the tenant. The form of the Schedule is dictated by the obligations set down in the lease and the time at which the Schedule is served. A Schedule served during the currency of the lease is referred to as an interim Schedule, unless served within the last three years of the term when it is deemed to be a terminal Schedule. A Schedule served at the end of a lease is a final Schedule of Dilapidations.
The first two forms of Schedule differ significantly from the latter: An interim or a terminal Schedule specifies breaches of repair and the repairs that the Landlord requires the tenant to undertake a remedy. However, in the case of a final schedule a landlord seeking a claim for damages, because since the lease has ended, the tenant has no right to re-enter the property to perform the repairs and hence the landlord seeks financial redress, not only for the cost of the works, but possibly also loss of rent, service charge, rates, professional fees and VAT.
Q: What is Statutory Relief for the Tenant?
A: Two principals forms of statutory relief are potentially available to the tenant served with a Schedule of Dilapidations. In the case of an interim Schedule the tenant might obtain relief from forfeiture proceedings (eviction) by applying to the court under the Leasehold Property Repairs Act 1938, providing the original term of the lease exceeds 7 years, of which 3 or more years remain unexpired.
In the case of a final Schedule and attendant claim for damages, the tenant may be afforded statutory relief by section 18(1) of the Landlord and Tenant Act 1927. This statute falls into two limbs. The first limb states that the landlord may not recover damages which exceed the sum by which the value of his reversion has been diminished as a result of the tenant’s breach of covenant. The second limb is a potential absolute defence against a final schedule of dilapidations. It is often vigorously contested between landlord and tenant and concerns a situation in which a landlord intends, at the end of a lease or shortly thereafter, to either demolish a building or carry out structural works to the building as would render valueless the performance of the tenant’s repairing covenants. If the tenant can prove its case absolutely, no damages will be payable.
Q: What points must be considered when protecting the Tenant?
A: Practical opportunities to mitigate a dilapidations liability occur in a number of situations. For example in the case of a new lease, particularly if it is to be short term, a tenant may insist that the repairing liability be limited to an obligation to leave the building in no worse condition than previously.
Planning
Q. Do I need planning permission to change the use of a factory (General Industry - B2) to warehouse and distribution (B8)?
A. Yes, if the change of use is in excess of 235 square metres.
Q. Are all conditions lawful?
A. No, a condition which has no relevance to planning is ultra vires. As an example, a condition that requires the first occupants of dwellings to be taken from a local authority's housing waiting list would be an improvement as it seeks to meet the objective of the local authority as housing authority and would not be imposed for planning reasons.
Q. When are planning obligations considered to be appropriate?
A. Section 106 of the Town and Country Planning Act 1990 introduced the concept of planning obligations, which comprises both the planning agreements and unilateral undertakings. It enables a planning obligation to be entered into by means of a unilateral undertaking by a developer and a local planning authority. In essence, planning obligations must meet the following five tests:
Q. What other uses within Class A1 (Shops) can the premises be used for?
A. Any of the following:
Rent Review and Lease Renewal
Q. The landlord has served a proposal to significantly increase my rent. What should I do?
A. Dependent on the terms within your lease it may be essential to serve a counter notice on the landlord. Normally any increase in rent from that currently passing will have to be justified with reference to comparable market evidence. It is the analysis and interpretation of this evidence and the understanding of relevant case law that forms the basis of advice provided by expert rent review surveyors.
Q. At rent review can rental go up or down?
A. The majority, but not all, leases contain rent review clauses which allow for upward only rent reviews. It is, therefore, essential to read through the lease.
Q. The landlord won't agree to the rental that I am proposing. Should I refer the matter to an arbitrator/independent expert?
A. Normally within the rent review clause of the lease there will be the ability to refer the matter of the rent review where it is not agreed to a third party. This will normally be done by applying to the RICS for the appointment of an arbitrator/expert. The cost of this third party will be shared between the parties although an arbitrator may award costs against a party. It is essential that advice is sought from a professional that has experience of third party procedures and the presentation of evidence, and he should report on the likely costs and the risks of the third party procedure.
Q. The term on the lease of the property that I occupy comes to an end shortly. Can the landlord get me out of the property?
A. Normally if you occupy premises for business purposes on a tenancy you will benefit from the Security of Tenure Provisions of the Landlord and Tenant legislation. This legislation gives the tenant the right to apply for a new tenancy subject only to specified grounds of opposition.
Q. On what grounds can the Landlord oppose renewal of my tenancy?
A. The landlord may be able to successfully oppose the granting of a new tenancy on the following grounds:
Q. What will the revised rental under the new lease be?
A. The rental is open to negotiation between the parties and in default of agreement the court will have regard to the terms of the tenancy and determine a rent at which the holding might reasonably be expected to be let in the open market by a willing lessor, disregarding occupation of the holding by the tenant, any goodwill attached to the holding, any effect of the tenants improvements.
Q. What will be the terms of the new lease?
A. The terms of the new lease are subject to negotiation, although in the absence of agreement the terms will be determined by the court. The maximum length of a new tenancy will be 15 years with the other terms normally following the existing lease although this may be dependent upon existing case law, market practice and individual circumstances of each case.
Valuation
Q. I intend to sell my property and I want to know what it is worth. Will I have to pay for a valuation?
A. If you are intending to market your property, Jones Granville will be delighted to meet with you and prepare marketing advice including a valuation without obligation. It is only when you require a formal written report that the usual valuation scale fees are payable.
Q. I have been told that I need to get a formal valuation report carried out in accordance with the Red Book. What is the Red Book?
A. The RICS Appraisal and Valuation Manual sets certain minimum requirements so as to ensure a high standard of valuation and reporting. The Manual contains mandatory practice statements and guidance notes, principally concerned with the mechanics of practice including the assembly, interpretation and reporting of information relevant to the task of valuation.
Q. Why is the insurance value of the property not the same as the open market value?
A. The valuation of a property will differ depending upon the purpose of the valuation. The insurance value will reflect the cost of re-building the premises including site clearance and professional fees etc. whereas the Open Market Value is an opinion of the best price at which the property would sell in the open market on certain assumptions.