A commercial lease often imposes restrictions on the alterations that can be made to premises. A Licence for Alterations is necessary to ensure that the premises are reinstated to the original configuration on expiry of the lease.
What is a Licence for Alterations?
Often in Commercial Property a tenant may require certain alterations to the property they occupy under a lease. To carry out these alterations, the tenant will likely need the consent of the landlord. This consent will come in the form of a document called a ‘Licence for Alterations’.
Why Alterations are required?
These alterations can be required for a variety of reasons, such as:
- altering the structure to fit the tenant’s commercial needs,
- installing new service installations
- opening the layout of the property by removing walls
- erecting walls or a partition to create offices or other smaller rooms within the property
Whether or not a Licence for Alterations is necessary will depend on how much work the tenant is proposing to carry out to the property, as well as what the lease itself states.
Why a Licence for Alterations is important for Tenant?
A Licence for Alterations is important to the tenant for a number of reasons,
- to ensure they comply with the terms of their lease
- To avoid breaching the lease and facing enforcement action
- If a Licence for Alterations is not granted prior to the works being carried out and the tenant retrospectively seeks this, the landlord will be given a huge advantage in terms of negotiating power and the demands they can make for the Licence to be given
- Tenant seeking to assign a lease whereby unauthorised alterations have taken place may face difficulties in finding potential purchasers.
Why a Licence for Alterations is important for Landlord?
For the landlord, a Licence for Alterations is important to ensure that all works carried out to their property are accurately recorded. It is not uncommon for leases to contain a reinstatement clause – an obligation on the tenant to return the property to the condition it was in prior to the lease commencement, which can include an obligation to remove any fittings installed by the tenant during their occupation. While these works are typically carried out at the tenant’s own cost, it is important for the landlord to have a clear and detailed understanding of what is required to be removed.
How we can help?
We understand that it’s essential that the interests of both the landlord and the tenant are fully protected to prevent future disputes resulting from the alterations. Whether you’re a commercial landlord or tenant, HS Legal Solicitors can act on your behalf, dealing with all the necessary paperwork to achieve a positive outcome for all parties. If you have any specific questions or would like more detailed advice related to licence for alteration, then please contact on 01206500181.