Printer Friendly

Plan ahead before making your move.

Byline: MIKE HUGHES

AS the number of businesses in distress in the North-east continues to rise, the RICS (Royal Institution of Chartered Surveyors) is continuing to urge established firms and start-up companies to thoroughly do their research when looking for new commercial premises.

Making a bad choice can lead to paying for space that is no longer needed or a building not fit for purpose, both of which will prove detrimental to the company's cashflow and long-term survival.

As the leading organisation responsible for setting the standards in land, property and construction, the RICS is advising businesses to approach the property search in a logical and organised way to avoid overlooking any key points which may hinder it at a later stage. Kevan Carrick, Partner in JK Property Consultants LLP and policy spokesman for RICS North East said: "So many businesses don't do enough research when it comes to finding the right premises to operate from and this is one of the most common reasons they run into problems.

"Once a business has chosen the location it would like to operate from, seeking advice from a chartered surveyor familiar with the chosen area is the next step. An RICS member will be able to provide additional information and expert advice on the most suitable properties in the area. They will also be able to challenge the company on their assumptions about the suitability of the location and any target properties which they feel may initially meet all their requirements.

"It is essential that existing companies and new start-ups consider their business strategy when choosing new premises, for example, the number of people they employ and the processes used in their business, as well as the property*s suitability for any plant/machinery required, which will all impact on the generation and cost of energy operating from the premises.

"They must also consider ongoing and future plans, such as how long they will need to operate from the property and within what timescale additional space may be needed for expansion. The quality and size of the actual workspace environment needs to be thought about thoroughly and how this may impact on staff and their productivity."

RICS recommends firms prepare a specification of the premises they want by sketching out a plan or accommodation list, detailing requirements including facilities such as car parking and kitchen/utility areas. This will enable a business to get a rough idea of the size and floor area needed.

Kevan adds: "It's important to check the chosen building's state of repair too. The chartered surveyor plays a key role here and he or she will be able to advise on the potential repair cost and other outlays that a business occupying the property may face.

"The chosen property must have planning permission for the appropriate commercial use and it is essential to check that there are no restrictions to running the business from the building (e.g. a limitation on working hours or noise emissions). If planning permission is required, at least eight to ten weeks should be allowed for the application to be processed."

According to the RICS, the proposed terms of the lease should then be checked by a chartered surveyor before a company instructs its solicitor to agree the formal documentation, paying particular attention to the clauses relating to service charges, rent reviews, break options, sub-letting and assignment, repairing and decorating obligations and personal guarantees.

Kevan concluded: "Prospective tenants are often told by landlords that many of the lease terms being offered are 'non-negotiable' but if they wish to agree a lease on competitive commercial terms they need the input of a chartered surveyor to navigate them through the potential minefield of negotiations."

* www.rics.org

CAPTION(S):

RESEARCH: Kevan Carrick Partner in JK Property Consultants
COPYRIGHT 2011 MGN Ltd.
No portion of this article can be reproduced without the express written permission from the copyright holder.
Copyright 2011 Gale, Cengage Learning. All rights reserved.

Article Details
Printer friendly Cite/link Email Feedback
Title Annotation:Business
Publication:Evening Gazette (Middlesbrough, England)
Date:May 31, 2011
Words:632
Previous Article:Avoid all doubt about risks of evading tax.
Next Article:Python gets a grip on history.

Terms of use | Privacy policy | Copyright © 2018 Farlex, Inc. | Feedback | For webmasters