Installation and Refurbishment Solutions Ltd

Perhaps we can look to bring to the workplace some of the positives we have experienced during this dreadful lockdown. For example, the importance of family and community.

While many have continued to work during the pandemic, teachers, health professionals, cleaners and Post Office workers amongst the more visible and spoken of in the media, there are also those who have not been mentioned, like directors of companies who have tried to keep their businesses ticking over and jobs still available for people to return to, as we will soon be allowed to do.

For anyone who has travelled up to London during the past 12-months to see the empty streets, closed shops and offices, there has been an eery silence where once the main and back streets of the Capital thronged with vibrance and commerce. It has at times been like a western movie, where one could almost imagine brushwood bushes blowing along Regent Street for example in complete silence.

The government though have given us a timetable to return and I for one, am already listing the restaurants, bars and sporting events I would like to go to in the second half of the year but perhaps more importantly a haircut and wet shave will be my first adventure.

As we return to our offices, if like I, many of you will have attended various Zoom meetings, presentations, discussions and heard expert’s opinions on the state of the economy as it is now and believe or at least hope of how it will be. This optimistic foretelling for the end to the year boom makes me realise that we now have the opportunity, to almost begin again to re-build our futures.

Perhaps we can look to bring to the workplace some of the positives we have experienced during this dreadful lockdown. For example, the importance of family and community.

How many of us enjoyed the simple experience of walking in our local park and smiling or speaking with strangers even if from a distance and are so looking forward to seeing a person’s full face without a mask observing the subtle variations in their facial expressions that enable communication to be fully expressed. Or the enjoyment of walking down to the shops and buying a simple cup of coffee or pastry from the local baker.

Maybe a little ‘rose-tinted spectacles’ for the moment but we will return to the office and the myth of home working for the masses finally debunked, although conversations will need to be undertaken regarding new working methods.

Some people will want to continue working from home (WFH) or near from home (WNH) on certain days, to allow for focussed project work or family flexibility. There are younger staff that have needed mentoring, social interaction, access to bars and restaurants and want to come into the office on a more structured and traditional basis.

These changes will cause disruption, and many will need a helping hand and maybe this is where Corporate Social Responsibility (CSR) will really come in to its own.

The pandemic has shown us that we all work better together, working for common purpose. Can this common sense of purpose now be directed at growing and helping our local community working together and with the local government driving improvement and change, create opportunities and be a more supportive and caring community for all those that work and reside in it.

Perhaps as simple as buying locally where you can - when we attend networking events, we meet many businesses that operate near us and give them the opportunity to quote for our business. At the beginning of last year, we undertook to employ local staff for our vacancies, give work to our neighbourhood businesses and to date, we have been so pleased with the dedication and hard work of those we have contracted to assist with our projects.

As directors of the business Rebecca and I have made a conscious decision to help and support local charities where we can. The mental health charity CALM was chosen by our team for our company to support. As well as being loud advocates for Legacy the national OnSide Youth Organisation we are committed to playing a full part in Croydon Commitment where we can best offer efforts to assist those close to us.

The pandemic has caused heartache, anger and desperation for many, but I hope that as we return and build the future for us and the next generation, we can incorporate a social responsibility and understanding on how and where we work. I would suggest that we all benefit far more by what we give in terms of offering active hands-on time to mentor or train and by using local businesses to build that future and I look forward to meeting again at networking events or in a restaurant.

Installing mezzanines and repurposing warehouse space can really maximise the value of the available space in a warehouse or in the commercial spaces often built below large blocks of flats.

Doubling the yield

For example, being able to turn 350m2 of warehouse space into 750m2 of storage and office space can in some cases double the rental yield or indeed reduce the outgoing costs for a business.

Large developers are usually expected to include in their developments commercial type space, which is generally not straightforward to convert as power, water, waste, HVAC and fresh air are not generally given much consideration at the planning stages.

However, when undertaking the shell and core type of fit out, some lateral thought and flexibility on the landlords side, such as the siting of air conditioning plant and routes for ductwork, will really enable previously unusable space to be fitted out for various commercial usages and increase the yield of space previously left empty for long periods of time.

Storage or office space?

Historically, developers working with commercial or industrial estates have installed mezzanine offices to only part of the warehouse when constructing the units, thus retaining space for racking and high-level storage.

While those type of units are still required, with ‘delivery on demand’ solutions available, many of the smaller units do not need so much storage area.

Improving the working environment

Changing working practices have also meant that employee needs and expectations of the workplace have evolved - varied agile workstations, hot desking, better and increased breakout areas and more informal meeting spaces are becoming the norm to attract and retain talented staff.

The demand for additional office space can be remedied by installing mezzanine floors and increasing the useable space on the upper floor and freeing up space on the ground floor to create modern and up to date workplaces without having to relocate the business, which quite often can be an ideal solution for both landlords and their tenants alike.

Many business owners and companies are trying to plan a way forward and although there are a variety of differing opinions, it is probably safe to say the office environment and the demands on it will not be the same at the end of 2020 as it was at the beginning and maybe for the foreseeable future.

Some firms will have already made the decision to:

Remain exactly where they are with no changes
Negotiate with the landlord to try to either reduce the amount of space they rent or lower their annual rent
Invoke their break clause
Leave at the end of their lease
Hand back the keys and leave immediately
And more often or not, most of these options will involve a difficult conversation about dilapidations between client and the landlord, as we return to work and the firms try to put their future plans into action.

What are dilapidations and when do they arise?

When companies come to the end of a lease there is normally a dilapidations clause within their lease that states that the property should be returned to the landlord in a pre-determined condition. If the works are not completed, then a sum is agreed to be paid to the landlord to potentially complete those works.

Bear in mind it is not the landlord’s responsibility to inform the tenant of the scope of works and when they need to be undertaken, it has already been agreed when you completed the lease that, on the anniversary date you would prepare the property for handover as detailed in the lease. If you don’t hand the space back in a condition that is acceptable to the landlord, you may also be liable for loss of rent. That was a rent agreed in a rising market and not necessarily in the current market.

There are some landlords that are happy to take the money and there are some that will only want the space stripped back to how it was at the start of the lease. It is important to find out what your landlord’s preference is.

You will need to be prepared before you talk to the landlord and negotiate either of these outcomes. So, are you able to prove the condition of the space as you took it on? Did you complete a photographic schedule of the space before you completed the lease? Did you get a Licence to Alter for any of the works you undertook, attached to the lease from the outset? Both of which will allow you to have a fair discussion with your landlord.

The dilapidations sum is arrived at through a schedule of works that the landlord itemises outlining their expectations to allow a figure to be identified for the works. It may be that you disagree with these figures and a Licence to Alter and photographic schedule will allow you to have that conversation with the landlord from a position of some stability.

With many landlords agreeing not to take rent during some of the Covid period some of them will need to start to get some money flowing back into their businesses and may not be in a position to be helpful. With properties having been empty for so long, standard maintenance and servicing will add additional costs to their overheads including water inspections, HVAC checks, additional security, extra cleaning and management of access to the building etc.

Additionally, it may be that as businesses have those conversations with the landlord, about cutting short the lease or reducing the size of the office space the landlord is not incentivised to be helpful.

But just walking away is never a solution and bad financial histories will certainly not help future expansion and investment into your business.

It is better to get on the front foot.
Do you know what your liabilities and responsibilities are?
Do you know what space you need?
Have you spoken to your staff?
Can the space you currently occupy be remodelled to suit your new needs?
Are you able to sub-let some or all, of the space?
Will the landlord allow you to be flexible in terms of rent, size of space, sub-letting?
Has the landlord given you a schedule of works that you disagree with?
How to move forward!
Just being able to get back into the office as we come to terms with new Covid working conditions may not be the only hurdle to overcome to keep your business operating.

How we can help

We are always happy and interested to have an initial chat with you and have many years’ experience in altering and adapting office space as well as all aspects of dilapidations from checking through leases for the exact terms, to helping with the settlement negotiations with the landlord or undertaking the dilapidations detailed in the schedule of works.