Dilapidation Claims and Physical Yieldback Obligations in Industrial Leases
Proactive floor slab core-drilling, envelope maintenance, and Section 18 valuation caps reduce industrial lease dilapidations settlements by up to sixty percent.
RICS Dilapidations Protocol
Meaning
Industry standard procedure governing the conduct of parties during a commercial property terminal claim. The rics dilapidations protocol provides a timetable for the exchange of information between the landlord and the tenant. The goal is to encourage a settlement before the case reaches a court.
Following these rules ensures that both sides act reasonably and provide evidence for their financial demands.
Dispute Resolution
Mediation is preferred over litigation to save time and legal costs. The rics dilapidations protocol sets out the format for the schedule of dilapidations and the tenant’s response.
Schedule Accuracy
Surveyors must quantify every repair item with specific costs and references to the lease clauses to ensure the rics dilapidations protocol is followed correctly. This prevents the landlord from including general improvements as part of the repair claim.
Negotiated Settlement
Final payments are usually a compromise between the cost of the works and the loss of value to the property. If the rics dilapidations protocol is ignored, the court may impose cost penalties on the non compliant party. This structure allows for a transparent negotiation where the tenant can challenge excessive quotes.
Most claims are settled through this process within six months of the lease ending.