end of lease fixtures and fittings

[tooldtocruise]

just a quick question I've got a hotel and bar that has been out on a lease for 8 years shortly coming to an end

They payed 20k for business and 15k for fixtures and fittings
can anyone tell me what would the rough price they would get back after 8 year use

anybody in the know or any experience ?

i know its a matter for solicitors but thought id ask here first

[Countdown]

Perhaps I'm missing something but I don't think they'd get anything back. They've bought the business and the F&F not rented them.

[tooldtocruise]

seems to make sense really, obviously they have a value to me more than they could be sold for outside i mean who would want a ex hotel bed or carpet, curtains

i just remember the solicitor saying they will be worth a percentage at the end of the lease

[jonby]

If you sold them the f&f and now want to buy them back, then it comes down to negotiating - they won't want to remove them as they are worth very little ex situ but you don't want to pay a lot for them !

However the f&f will fall into 3 categories - removable items (the tenants as they paid 15k for them), tenants fixtures (semi built in, but still belonging to them, however they must pay to make good if they remove them) and landlords fixtures, which are sufficiently incorporated to be your property and therefore cannot be removed

One imagines with an 8 yr lease, there will also be a delaps clause

With all of this, there is often a difference between what you are each entitled to do and what you might all agree to in a commercially sensible compromise agreement. Also remember that there is often a dispute as to what is now a landlords fixture and what is a tenants fixture - we get involved in such discussions on a frequent basis and most of the people we deal with don't properly understand.......

[Cyberprog]

You might also want them to remove the fixtures & fittings so you can do a re-fit. Entirely up to you, though they may leave things behind that have no value...

[Chrisgr31]

Is the lease protected? Is it coming to an end or will it be renewed?

[tooldtocruise]

jonby said:

If you sold them the f&f and now want to buy them back, then it comes down to negotiating - they won't want to remove them as they are worth very little ex situ but you don't want to pay a lot for them !

However the f&f will fall into 3 categories - removable items (the tenants as they paid 15k for them), tenants fixtures (semi built in, but still belonging to them, however they must pay to make good if they remove them) and landlords fixtures, which are sufficiently incorporated to be your property and therefore cannot be removed

One imagines with an 8 yr lease, there will also be a delaps clause

With all of this, there is often a difference between what you are each entitled to do and what you might all agree to in a commercially sensible compromise agreement. Also remember that there is often a dispute as to what is now a landlords fixture and what is a tenants fixture - we get involved in such discussions on a frequent basis and most of the people we deal with don't properly understand.......

been reading up a bit more and im getting a good feel for what they can and cant take now, they are expecting full money back so i will have to bring them back to reality on that one
thanks for the info you seem well clued up, can i ask a little on your background ..pm if you like

[tooldtocruise]

Chrisgr31 said:

Is the lease protected? Is it coming to an end or will it be renewed?

no it wont be renewed i will be taking it over

[tooldtocruise]

Chrisgr31 said:

Is the lease protected? Is it coming to an end or will it be renewed?

no it wont be renewed i will be taking it over

[Countdown]

tooldtocruise said:

been reading up a bit more and im getting a good feel for what they can and cant take now, they are expecting full money back so i will have to bring them back to reality on that one

Could be a nasty wake-up call. Based on what you say they purchased outright the Business and the F&F so they own them (and can do with them as they wish). You're not under any obligation to buy them back. Furthermore there should be some dilapidations provision in the Lease so, even if theyd ecide to remove all the F&F, the premises still have to be left in a similar condition to what they were like when their lease commenced.

[tooldtocruise]

Countdown said:

Could be a nasty wake-up call. Based on what you say they purchased outright the Business and the F&F so they own them (and can do with them as they wish). You're not under any obligation to buy them back. Furthermore there should be some dilapidations provision in the Lease so, even if theyd ecide to remove all the F&F, the premises still have to be left in a similar condition to what they were like when their lease commenced.

Thanks, It really looks like it can work in my favor, however im in no way want to take advantage but at the moment im almost pennyless without a job so finding 16k in this climate is not going to be easy

thanks for help

[jonby]

tooldtocruise said:

jonby said:

If you sold them the f&f and now want to buy them back, then it comes down to negotiating - they won't want to remove them as they are worth very little ex situ but you don't want to pay a lot for them !

However the f&f will fall into 3 categories - removable items (the tenants as they paid 15k for them), tenants fixtures (semi built in, but still belonging to them, however they must pay to make good if they remove them) and landlords fixtures, which are sufficiently incorporated to be your property and therefore cannot be removed

One imagines with an 8 yr lease, there will also be a delaps clause

With all of this, there is often a difference between what you are each entitled to do and what you might all agree to in a commercially sensible compromise agreement. Also remember that there is often a dispute as to what is now a landlords fixture and what is a tenants fixture - we get involved in such discussions on a frequent basis and most of the people we deal with don't properly understand.......

been reading up a bit more and im getting a good feel for what they can and cant take now, they are expecting full money back so i will have to bring them back to reality on that one
thanks for the info you seem well clued up, can i ask a little on your background ..pm if you like

My pleasure. Happy to liaise via PM. I work for Insolvency practitioners (liquidators & administrators) - we do a lot of property work and I employ an in house FRICS property director

I don't quite understand the basis they are expecting money back - they either rented the assets or bought them. We are assuming they bought them. Unless they are trying to hold you to ransom, by understanding that you are not obligated to buy the assets back, but assuming you are desperate for the assets to stay so they can hold you over a barrel over what you pay

But equally you can have them over delaps and having to make good if they do remove. Which comes back to the first bit of my first post - it's a straight negotiation

Edited by jonby on Wednesday 11th February 07:08

[tooldtocruise]

Thanks for the info, I have sent you a quick pm

[Cyberprog]

jonby said:

But equally you can have them over delaps and having to make good if they do remove. Which comes back to the first bit of my first post - it's a straight negotiation

Aye, sounds like they're in a position where you hold all the cards.

[Chrisgr31]

Cyberprog said:

jonby said:

But equally you can have them over delaps and having to make good if they do remove. Which comes back to the first bit of my first post - it's a straight negotiation

Aye, sounds like they're in a position where you hold all the cards.

Except if their lease is protected, in which case the OP might well need to pay them compensation if he is not renewing the lease!