Commercial property lease period ?

[lanan]

I am looking to find an Industrial Unit in Milton Keynes.
What is the sensible minimum lease period a landlord would accept, I don't want a huge commitment, but I also don't want to pay over the odds rent.
Many Thanks in advance
Graham

[chrisgr31]

lanan said:

I am looking to find an Industrial Unit in Milton Keynes.
What is the sensible minimum lease period a landlord would accept, I don't want a huge commitment, but I also don't want to pay over the odds rent.
Many Thanks in advance
Graham

Depends on the size of the unit etc. Personally I suggest ensuring you take a lease which is protected by the Landlord and Tenant Act 1954. Many Landlords find tenants on a short lease do renew and hence short leases are becoming more popular.

I would suggest that the minimum term without too much punishment in terms of rent per square foot would be 5 years, some may do 3. Take extreme care if offered say a 10 year lease with 5 year tenant option to break. It can be more complicated than expected to activate the break clause!

[lanan]

Thanks for that Chris.

[Davel]

You may find that, if the tenant wants a break clause, then so will the Landlord.

That normally effectively makes it a shorter term deal.

Most Landlords like the medium term lets because they don't have to go through all the change-over stuff too often.

Some of our lease are only two year terms. Anything longer than three-years will have reviews set say each third year.

Just make sure that you don't have too long a committment if your clients are not longer term.

Not many people these days go for long-term leases.

[chrisgr31]

Davel said:

Some of our lease are only two year terms. Anything longer than three-years will have reviews set say each third year.

Just make sure that you don't have too long a committment if your clients are not longer term.

Not many people these days go for long-term leases.

Although some rent reviews are 3 years, many are still 5 years. It is likely to be dependent on the landlords policy and the deal you can agree. Generally though you will pay an additional rent for a short lease, and the shorter the lease the more you pay. I know of someone who is paying 16% per annum more in rent because they wanted a 1 year lease renewal instead of 9 years. Achieving a 5 year term should not be a problem, a 3 year term may be harder.

Also if the original poster takes a unit they may want to agree a schedule of condition so you don't get caught out with dilapidations at the lease expiry. If you don't get a schedule of condition at the very least take lots of photos of the interior and exterior.

[vex]

As has been said, ot depends on the size and the type of agreement.

I have 1000sqf in herts, not a great location but good enough.

I rent it on licence, costing me £550 per month + electrics and a portion of the waste / skip hire.

1 year fixed contract then rolling 1 month notice, which I am now in.

If it is for the motorsports consultance and you need more garage stuff, then there is an old 4x4 forecourt in Woburn that has been empty for years and quite possiblely there could be a deal to be had. Its on the road out to Hockcliff.

Alternatively Blecthly Park has some technology incubaters avaialble, which I really fancy. Love to work on the old Station X site.

HTH

Chris

[chrisgr31]

vex said:

I rent it on licence, costing me £550 per month + electrics and a portion of the waste / skip hire.

Incidentially always convert an amount per month/week/year into an amount per sq ft (or metre). It allows you to compare the options of other space better.

In my experience I find that businesses take space on farms etc at £x per week as it sounds cheap, little realising that in fact they could get a modern unit on a local estate for less money per sq ft or even per year.

I hasten to add that dependent on the quality etc £550 a month doesn't sound unreasonable with my limited knowledge of the market in hertfordshire.

[vex]

Its bloody good for Tring, I can tell you.

Units here never stay empty for longer than a month or so.

[lanan]

Yes the Woburn site would be good. I live in the next village..! But as mentioned, it was expensive when I enquired last year.
Whilst I have the ear of you chaps in the know. What is the likely % difference in rates of a unit on an Ind estate to a Farm building.
Std Ind units seem to rent at £6/ft whereas Farm units rent at £5/ft.
If anyone has premises with around 2,000 sqft doing nothing in/near Milton Keynes get in touch..!
Many Thanks
Graham