Don’t pay more than you should – the warehouse tenant’s dilapidations defence

We have made it our business to focus on assisting logistics & warehouse tenants in particular. Because this is where our uniquely successful approach consistently delivers unparalleled reductions on landlords’ damage claims.

How? By being the only dilapidations consultancy to employ the building surveyors that all employ (their expertise is in negotiating down the landlord’s claimed remedial costs), and also (unique to us) valuation surveyors (valuers) who’s expertise is in applying the underused statutory “Section 18” defence to cap settlement at the lower of the remedial costs negotiated between building surveyors OR the impact (if any) on the property’s value. This is usually significantly less. Especially for sheds and big boxes.

Our expert valuers, informed by open market transacting experience, apply the Section 18 (diminution in value) cap with maximum impact. Put simply, if we assume you handed the property back in perfect order, it would still need usually extensive upgrades and modernisation works doing so as to optimise re-lettability, hence value. Few to no businesses want to move into anything less than at or about as new these days. But the tenant vacating at lease end isn’t obliged to hand back that way – especially, but not only, if there was a Schedule of Condition attached to the lease at the start.

Landlord works to modernise and upgrade commonly include: entire new roof (which could often be repaired, but preference is new with warranty as well as to increase insulation to improve EPC); gutted and brand new offices, WCs, etc; new VRF, wider/taller (and more) electric roller shutter doors; brand new dock levellers (again, to obtain warranties); immaculate cladding, re-sprayed in a “modern” hue, and so on.

These landlord works are often denied as planned by the actual landlord, but fortunately, the law directs the valuer to assume the “hypothetical purchaser”. It would be appreciated if these likely market-driven landlord works served to snuff out many (“big ticket”) items for which the tenant building surveyor has to agree on remedial costs. Hence, the Section 18 cap, properly applied, is so powerful.

To the tune of hundreds of thousands, sometimes millions, of pounds.

The Section 18 defence is not automatic. So if you only have a building surveyor acting, it is unlikely it will be evoked. You must both know about it and have a specialist valuer apply it.

We are the only consultancy that employs and automatically deploys both disciplines in your defence. Hence, our unparalleled successes and rapidly rising popularity as the dilapidations consultancy of choice for warehouse & logistics occupiers facing dilapidations claims.

Please get in touch with us by phone on 0330 094 5446, email enquiries@dilapsolutions.com, or WhatsApp with any queries. We are here to achieve the best outcome for you.