“When thinking about signing a lease on a commercial property, you need to carefully consider whether there are any alterations that you may need to make to the space, as changes will need to be agreed with the landlord from the start of lease negotiations.

As you reach the point of finalising the Heads of Terms with your landlord, you will need to state what work you plan to do, as this should be formally agreed and may require a separate Licence for Alterations document.

When making non-structural alterations, a formal document is not always required and where appropriate, the landlord can issue a simple letter licence which means approval can be granted quickly and at no cost.

Where a formal Licence for Alterations is required, this may incur additional legal fees as well as professional and management fees. If this is the case, the landlord will request your solicitor’s details and provide an estimate of these fees. Some landlords, such as SEGRO, won’t charge for agreeing alterations, if they are approved during lease negotiations.

After agreeing any additional fees, the official Licence for Alterations document will need to be finalised – this should include details of requested works as well as a plan of the property’s current condition and a plan incorporating the desired alterations.

Once the Licence for Alterations, or a letter licence, has been completed works can start, subject to obtaining any other required consent. For example, you may need to planning permission or building regulation approval. You will also need to comply with all relevant statutory requirements, including those related to health and safety and your building’s insurance - a reputable landlord can advise on all these regulations, should you have any queries.

It is always important to check whether your lease contains any specific provisions relating to alterations, in case you want to carry out additional work during your tenancy.

At the end of your lease, landlords may require you to reinstate the premises to its original condition, prior to your alterations. If the works were fully documented at the start, all parties should be clear about what is expected and when.

Overall, when deciding to rent a commercial property, it is important to understand the need to finalise alteration plans early on, before you occupy the unit. By doing so, you will ensure you have the most effective space for your business.”
 
SEGRO’s London assets are located across more than 60 estates and clustered around the key Heathrow, Park Royal and Greenford markets and in and around the M25, M40 and A40 corridor. To find out further information about SEGRO, please visit www.SEGRO.com , or contact SEGRO’s customer services on: 01753 537171.