A Landlord’s Obligations in a Commercial Lease UK

As a commercial landlord, you will have responsibilities within the lease towards your tenant, and you must adhere to these. If you do not, it could constitute a breach of the commercial lease. This could affect the length of time your tenant leases the property and, worse still, can lead to future legal disputes. Failing to abide by some safety responsibilities can lead to a fine or even imprisonment. This article will set out the key obligations of a commercial landlord in the UK.

What is a Commercial Lease?

A commercial lease is where you, as a landlord, allow a business owner to have sole occupation of your property or part of it to use as their business premises. You allow them to use the premises for a specific business purpose and specified period. In return, your commercial tenant will pay you an agreed rent. 

Your tenant will have key responsibilities in the lease and rights. As the landlord, you will also have key obligations and rights in the lease. A landlord’s obligations will primarily depend on what the lease agreement describes. However, some obligations are common to most commercial leases in the UK. We explore these below.

Health and Safety 

As a commercial landlord, you will generally need to ensure that the property and overall building are safe for your commercial tenant’s occupation and others who may use the building before you lease it. Your obligations will heavily depend on the type of property you own. 

Typical duties relating to health and safety involve the following:

• installation and maintenance of any fixtures and fittings you own;
• maintenance of the property’s electrical system; and
• compliance with gas safety responsibilities (failing to do so could result in a fine or imprisonment). 

Your lease may also detail that the health and safety of the building’s communal areas are your responsibility. You may also be responsible for undertaking an asbestos assessment, creating a management plan, and providing fire safety equipment. Often, your business tenants will then take over these management responsibilities, which the lease may refer to specifically or generally. 

Repairs and Maintenance

Your lease agreement will also list your responsibilities concerning repairs and maintenance. These obligations will vary between each lease. However, you will typically be responsible for structural repairs, including:

• the foundations;
• flooring;
• the roof; and 
• exterior walls.

Building Insurance

Arranging building insurance is normally your responsibility as the commercial landlord. You will initially pay for this but may pass it on to your tenant as insurance rent. Having building insurance is essential as it provides financial security to you should your property be damaged. 

Although insurance does not have to strictly be your responsibility to arrange and pay, you may find it beneficial to make it yours. This is because you can:

• choose the level of cover you require;
• be the person to deal with any claims; and 
• ensure that insurance is maintained for the property.

Key Takeaways

You have some key responsibilities to comply with as a commercial landlord. Whilst this can vary between individual leases, there are some typical responsibilities to note. First, you could be responsible for health and safety, for example, in terms of initial electrical safety and will typically be responsible for all health and safety in communal areas. Second, you may have some repair and maintenance responsibilities. Finally, you will typically be responsible for arranging building insurance.

If you need help understanding responsibilities in a commercial lease in the UK, our experienced leasing lawyers can assist as part of our LegalVision membership. For a low monthly fee, you will have unlimited access to lawyers to answer your questions and draft and review your documents for a low monthly fee. Call us today on 0808 196 8584 or visit our membership page.

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